French General Tax Code
In forceThe deficit charged under the conditions provided for in the first paragraph ceases to be carried forward to the results of the financial years following the one in respect of which it was recognised.
The option mentioned in the first paragraph is only allowed on condition that it relates to the deficit recorded in respect of the financial year, up to the limit of the lower of the profit declared in respect of the previous financial year and an amount of €1,000,000.
The excess corporation tax resulting from the application of the first paragraph gives rise to a non-taxable claim in the same amount in favour of the company.
The claim is repaid at the end of the five years following that of the close of the financial year in respect of which the option referred to in the first paragraph was exercised. However, the company may use the claim for the payment of corporation tax due in respect of the financial years ended during these five years. In this case, the claim is reimbursed only up to the fraction that has not been used under these conditions.
As an exception to the provisions of the fifth paragraph, companies that have been the subject of conciliation or safeguard proceedings, or judicial recovery or liquidation proceedings, may request reimbursement of their unused claim from the date of the decision or judgement that opened these proceedings. This repayment is made after deduction of interest applied to the outstanding debt. This interest, the rate of which is that of the legal interest applicable in the month following the company's request, is calculated from the first day of the month following this request until the end of the five years following that of the close of the financial year in respect of which the option was exercised.
The claim is inalienable and non-transferable, except under the conditions provided for by Articles L. 313-23 to L. 313-35 of the Monetary and Financial Code, or under conditions set by decree.
II. The option referred to in I is exercised in respect of the financial year in which the deficit is recorded and within the same timeframe as that for filing the income tax return for that financial year. It may not be exercised in respect of a financial year during which there is a sale or total cessation of business, a merger of companies or a similar transaction, or a judgment declaring the company to be wound up by the court.
In the event of a merger, demerger or similar transaction taking place during the five years following the end of the financial year in respect of which the option referred to in I was exercised, the claim of the absorbed, demerged or transferring company may be transferred to the company or companies benefiting from the contributions. The transfer of the claim is made for its nominal value.
In the event of a demerger or partial contribution of assets, the claim is transferred in proportion to the amount of the actual net assets contributed to the company or companies benefiting from the contributions assessed on the effective date of the transaction.
(Paragraph disjointed).
III. (Repealed).
IV. A decree sets out the conditions for the application of this article, in particular the reporting obligations of companies.
