France Launches COVID-19 Tax Settlement Scheme For SMEs

by Ulrika Lomas, Tax-News.com, Brussels

21 August 2020

France's General Directorate of Public Finance has launched a scheme that allows small companies to request a specific settlement plan for the payment of their taxes.

The scheme, included in Decree No. 2020-987 of August 6, 2020, is aimed at micro-, small- and medium-sized firms and sole traders particularly affected by the economic consequences of COVID-19.

Those claiming the relief must have started their business activity no later than December 31, 2019, and must be up to date with their tax reporting obligations. They must employ fewer than 250 employees on the date the claim is made. Their turnover for the last financial year must not have exceeded EUR50m and they must not have a balance sheet total in excess of EUR43m.

These same conditions apply to those subject to tax under the Article 233A tax consolidation regime.

The applicant must also attest to having requested from their private creditors a deferral of payment or additional financing facilities, excluding loans guaranteed by the state, for the payment of debts owed and payable between March 1, 2020, and May 31, 2020.

The settlement plan covers VAT and withholding tax due for the months of February to April 2020, which should have been paid from March to May 2020. It also covers balances of corporate tax and contribution on added value (CVAE), which was due to be paid between March and May 2020.

Tax debtors will be allowed up to 36 months to pay the tax debts.

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