If you are an international company looking to hire in France, you will have to choose whether or not to open a facility in France. As legal procedures can vary, it may be useful to apply for a rescrit fiscal (or tax ruling) to formalize the fact that you do not have an establishment in France. Here is an overview of this useful procedure that not many people know about!
What is a rescrit fiscal?
If you are looking for an “official” answer to a tax question, one that’s more complex than a simple request for information, you can put your question to the tax authorities using this procedure. You will then receive an answer, known as a “rescrit fiscal” (or tax ruling) where the tax authorities will commit to respecting its decision.
How to make a request?
You must send a written request with acknowledgement of receipt to the department in charge of your taxes. The tax authorities must respond within 3 months (general case) of receiving your request. Any company or individual can request a rescrit fiscal. Before making your request, consult the register of previous rulings that have been made public. You may find your answer there.
Your request for a rescrit fiscal must include as much detail as possible including:
– The name of your business,
– The mailing address of the head office,
– Your contact: email and telephone number,
– An accurate description of your situation,
– The tax legislation which you fall under.
To find out all about the practicalities of applying for a ruling, visit the service-public website.
In what cases should you use this service?
Are you planning a rental investment, but want to make sure you benefit from the tax advantages? Is your company investing in research projects and would like to know beforehand whether its activity will be eligible for aid? In all cases, your request must be based on tax legislation requiring clarification with regard to your own personal/professional situation.
There are several types of rulings: general cases and specific cases. Some types of ruling are more advantageous because a failure by the tax authorities to provide an answer within a period of 3 months is equivalent to a tacit agreement.
Specific cases of tax rulings include:
– The rescrit-valeur (or value ruling) (L. 18 of the Book of tax procedures (LPF): this procedure enables a company to estimate the value of its assets/securities to be transferred in case of donation to avoid any tax adjustments. The administration gives its answer within 6 months. Failure to reply does not mean that the tax authorities have agreed.
– Existing rulings to check whether you benefit from tax relief for particular situations. In these rulings, the agreement is issued within 3 months: if there is no response within this timescale, it is equivalent to an acceptance.
o new businesses (L. 80 B-2 of the Book of tax procedures or LPF). Complete your application with the information listed in this additional form.
o ”businesses located in RRAs” (rural revitalization areas) and “businesses created or taken over in rural revitalization areas”. Complete your application with the information listed in this additional form or this one.
o Businesses eligible for research tax credit. Complete your application with the information listed in this additional form.
o young innovative or student companies. Complete your application with the information listed in this additional form.
– Le rescrit établissement stable or permanent establishment ruling L. 80 B-6 of the Book of tax procedures or LPF. With this procedure, you are guaranteeing that your company does not have any establishments in France. This information is important because it will determine how you are taxed and how you declare your employees for the payment of all your employer and employee charges. Complete your application with the information listed in this supplementary form.
To consult the entire list of specific rulings, visit the website impots.gouv.fr. However, if your request does not relate to one of these specific cases, you can choose the general case.