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Exceptional tax measures to support businesses affected by coronavirus (Covid-19)

19 March 2020

The French Tax Authorities (FTA) have specified the exceptional tax measures implemented in favor of all businesses to offset the economic impact of the Covid-19 outbreak.

Tax payment deferral 

In his televised address on the night of 12 March, the French President of the Republic declared that businesses could postpone the payment of their taxes and contributions due in March 2020, without any justification, nor formality or penalty. The FTA have provided details on the emergency measures applicable to all businesses.

A deferral of the direct tax payments due in March may be asked by companies, or their certified public accountant, to their tax offices. This measure applies to the corporate income tax (CIT) instalment, payroll tax and – for companies paying the following taxes monthly – corporate real estate contribution (CFE) and real estate tax. The simplified claim Form (in French) provided by the tax authorities may be used. With regard specifically to the CIT instalment due on 15 March 2020, the government may decide to grant a deferral until 15 June. Companies which have already paid their March instalments may either cancel the SEPA direct debit or ask for a refund to their tax offices (for example by indicating « Acompte déjà payé pour remboursement » in the box « Montant restant dû » in section 1 of the simplified claim Form

Monthly instalment commitments for CFE and real estate tax may be suspended either directly in the business section on the website impots.gouv.fr (Espace professionnelor by contacting the designated service (Centre prélèvement service). The remaining amount will be collected with the balance payment at the end of the year.The rate and the instalments of the withholding tax on personal income tax may be adjusted by self-employed workers at any times. They could also postpone the payment of their monthly or quarterly instalments of the withholding tax on their professional income, from one month or one quarter to the next, in the personal section on the website impots.gouv.fr (Espace particulier).  No exceptional measures have been set up to defer VAT payments

Tax rebate

Businesses meeting coronavirus-induced difficulties which cannot be remedied by the tax payment deferral, may apply for rebates on direct taxes (CIT, CFE, company value-added contribution or CVAE), penalties or late interest by proving their distressed financial situation. They may use the simplified Form (box 2). However, the criterion of distress will be strictly assessed by the FTA.

Acceleration of the payment of invoices by public services

The FTA are committed to commit to quicken the payment of outstanding debts (tax credit for research expenses, VAT credits, etc.) and the payment of invoices awaiting payment by the State, local authorities and government agencies. Businesses may use the simplified Form (box 3).

Slowdown of tax audits and collect operations

The FTA have informed the main business representative organisations that, in view of the exceptional situation due to the Covid-19 epidemic, no new tax audit would be launched and no procedural act (reassessment proposal, assessment notices) would be sent for current tax audits, except in case of statute of limitation or specified delay set out by law. For current tax audits, the FTA may request documents or a phone appointment, but the company may indicate not being in a position to respond favourably for the time being. Businesses which are in a position to grant such requests may respond either by post (by letter with acknowledgement of receipt) or by email. A law to "freeze" the consequences of non-compliance with the deadlines should be proposed very shortly. At the same time, adjustments regarding the enforced collection of tax debts are being studied.

Other matters

New announcements are expected on issues such as the postponement of deadlines for tax returns

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