Intégration fiscale en France
Author: Siamak Mostafavi
I. Tax Grouping Definition (Intégration fiscale)
Tax grouping refers to the consolidation of all tax obligations of a group of legal entities (personnes morales).
II. Determining Tax Grouping in France under the Concept of French Tax Grouping in the French Tax Code
In determining tax liability, the losses of certain subsidiaries (filiales) may be deducted from the profits of other entities within in the group such that there is a single taxable result (résultat d'ensemble).
III. Qualifying for Tax Grouping in France under the Concept of French Tax Grouping in the French Tax Code
In order for a group of affiliated companies to qualify for tax grouping, five conditions must be fulfilled.
IV. Requirements and Conditions to Qualify for Tax Grouping in France under the Concept of French Tax Grouping in the French Tax Code
Tax Grouping Conditions:
(i) Group of legal entities: the grouping comprises legal entities, which are parent companies (sociétés-mère) or subsidiaries (filiales). The creation of the grouping requires the election (option pour l'intégration) by the parent company and acceptance by its subsidiaries;
(ii) Subject to the French corporate tax: entities must be fully subject to the French corporate tax (impôt sur les sociétés) at the standard rate (taux de droit commun);
(iii) Same financial year: all entities within a group must have the same financial year (exercice comptable) of 12 months;
(iv) 95% ownership: the parent company must own, whether directly or indirectly, at least 95% of the subsidiaries' share capital during the entirety of a given financial year; and
(v) European presence: generally, foreign entities are not eligible for the grouping unless the subsidiaries are held by an entity incorporated in, or that has a permanent establishment (établissement stable) within, the European Economic Area (Espace Economique Européen).
V. Tax Consequences of Tax Grouping: