Tax advisory
It is not the rate that decides, it is the classification.
The corporate income tax rate can be looked up in a table. What actually determines your tax position in France is something else: whether your presence amounts to a fixed establishment, which flows fall under French VAT, and whether your transfer prices can be justified.
What it coversThree questions decide, the rest follows.
For a foreign group operating in France, the tax outcome is rarely decided by the rate. It is decided by three classifications: are you established in France? Which flows fall under French VAT? And will your intra-group transactions stand up to an audit?
Those three answers govern everything else — the returns to file, the withholding taxes, the documentation to keep ready. They are not found in a statute; they follow from the human and technical resources actually present and from the reality of the flows.
We settle these questions in advance, not when the tax authorities raise them. And we write the answers down: a position that is not documented cannot be defended three years later.
What it covers
From the routine return to defending a position.
Corporate income tax
The “liasse fiscale”, instalments and final settlement, with the deadlines tracked — and the reconciliation between the accounting result and the taxable result.
VAT
Registration, periodic returns, refund claims, the recapitulative statement and the survey on trade in goods. And the classification of the flows beforehand, which is where reassessments arise.
Fixed establishment
An analysis of your presence in France: people, technical resources, authority to conclude contracts. The written position follows from that. The answer may differ for VAT and for income tax.
Fiscal representation
A company established outside the European Union, without a fixed establishment in France and carrying out transactions there subject to French VAT, must appoint a fiscal representative established in France. We check whether this applies to you and arrange the appointment.
Transfer pricing
Local documentation, its consistency with the group file, and the justification of intra-group flows — ready before the request, not written afterwards.
Withholding taxes
Dividends, interest and royalties paid to the parent, applying the relevant tax treaty together with the formalities on which the reduced rate depends.
Local business taxes
The property-based business contribution and, for as long as it remains, the value-added contribution — including the allocation of establishments, which is often mis-declared in the first year.
Tax audits
Support from start to finish: preparing the documents, answering requests, discussing the points raised and dealing with the outcome. International matters are now at the centre of audits.
Frequently asked
On obligations, thresholds and audits.
The questions that recur among foreign groups whose French activity is starting or changing in nature.
Scope
We have no French subsidiary, only a VAT registration. What obligations apply?
French VAT returns and, depending on the flows, the recapitulative statement and the survey on trade in goods. Corporate income tax does not apply in principle as long as there is no fixed establishment — and that is precisely the point that needs to be settled and written down.
What creates a fixed establishment?
It is not a tick-box. What counts is the human and technical resources actually present, their permanence, and the authority to conclude contracts. An employee working from home, a stock of goods, a long-running site or a dependent agent can be enough depending on the circumstances.
The classification for VAT does not necessarily coincide with the one for income tax, nor with the one under a tax treaty. One can exist without the other.
Do we need a fiscal representative?
A company established outside the European Union, without a fixed establishment in France and carrying out transactions there subject to French VAT, must appoint a fiscal representative established in France. Companies established within the Union are not subject to that requirement.
Documentation and audits
Do we have to document our transfer prices?
The obligation depends on thresholds and on group membership. Regardless of the threshold, the tax authorities can ask for intra-group flows to be justified during an audit: a head-office recharge, a brand royalty or an intra-group loan without documentation are the most frequent grounds for reassessment.
Does withholding tax apply to dividends paid to the parent?
Withholding tax is the starting point; a tax treaty or the European parent-subsidiary regime may reduce or remove it. The reduced rate is not automatic: it depends on formalities and evidence that must be in place before the distribution.
What happens in an audit?
It begins with a notice, then with handing over the accounting entries file. International matters are now at the centre of audits: fixed establishment, transfer pricing, VAT on cross-border flows. We prepare the documents, answer the requests and discuss the points raised.
Related services
What the tax positions rest on.
Accounting
The figures the returns build on — and the “FEC” an audit will ask for.
See the serviceCross-border advisory
Transfer pricing, fixed establishment and intra-group flows — seen from both sides.
See the serviceE-invoicing in France
What falls under electronic invoicing and what falls under “e-reporting” alone.
Read the briefingThe next step
Settle the classification
before the tax authorities settle it.
Describe your presence in France — people, premises, contracts, intra-group flows. We will tell you where you stand and what should be put in writing now. We work in French, German and English.
- FRADECO SAS · Paris
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50, Rue Chapon · 75003 Paris
+33 1 40 09 13 77 - FRADECO GmbH · Bonn
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Simrockstr. 92 · 53619 Rheinbreitbach
+49 2224 123 14 83