French General Tax Code
In forceI. - Any person who has been authorised to receive goods or services duty free, tax suspended under article 277 A or under the benefit of a reduced rate is liable to pay the tax or the additional tax, where the conditions to which the granting of this exemption, this suspension or this rate is subject are not met.
II. - Any recipient of transactions eligible for the reduced rates in accordance with Article 278 sexies, with the exception of 4° of III of the same Article 278 sexies, is required to pay the additional tax when the conditions to which the granting of these rates is subject cease to be met within fifteen years of the event giving rise to the transaction. This period is reduced to ten years if the property is sold, converted to another use or demolished under the conditions set out in Chapter III of Title IV of Book IV of the French Construction and Housing Code. It is also reduced to ten years when the property has been acquired by individuals under the conditions set out in 1° and 2° of III of article 278 sexies. However, the additional tax is not due when the conditions cease to be met following the sale to their occupants, under the conditions provided for by loi n° 84-595 du 12 juillet 1984 defining lease-to-own property, of housing mentioned in 1° of III of article 278 sexies or building land.
For deliveries of the housing referred to in 1° and 3° of III of article 278 sexies, the additional tax due is reduced by one tenth per year of ownership beyond the fifth year. However, when the property has been acquired by individuals under the conditions provided for in 1° and 2° of the same III, it is reduced by one tenth per year of ownership from the first year onwards.
II bis. - Any taker of deliveries subject to the reduced rate in accordance with Article 279-0 bis A is required to pay the additional tax when it ceases to let all or part of the housing units under the conditions provided for in c of the same Article within twenty years of the event giving rise to the transaction, unless this cessation results, from the eleventh year onwards, from sales of housing units.
Until the sixteenth year following the triggering event for the construction operation, no more than 50% of the housing units may be transferred.
III. - Any person who has carried out the work mentioned in Article 278 sexies A themselves, with the exception of 5° of I of the same Article 278 sexies A, is required to pay the additional tax when the conditions to which the granting of these rates is subject cease to be met within three years of the event giving rise to the transaction.
IV. - Joint property associations are required to pay the additional tax when the conditions for granting the reduced rates applied in accordance with 4° of III of Article 278 sexies or 5° of I of Article 278 sexies A are not met within five years of the event giving rise to the transaction or cease to be met within fifteen years of the acquisition of the real rights by the person occupying the property. In the latter case, the additional tax is reduced by one tenth for each year of ownership after the fifth year. Where the failure to comply with the conditions governing the reduced rate concerns only certain dwellings within a group of dwellings, the additional tax is calculated in proportion to the surface area of the dwellings concerned in relation to the surface area of all the dwellings.
V. - A.-When the conditions for the exemptions provided for in 8 of Article 261 or in 2° bis of II of Article 291 are no longer met, the tax becomes payable under the conditions provided for in B of this V, according to the rules in force on the date of this event.
Eligible uses and eligible persons are those designated by the authorisation referred to in 2° bis of II of article 291 and, where applicable, by the orders referred to in 8 of article 261 and 2° bis of II of article 291.
B.-The persons to whom the intra-Community supplies and acquisitions of goods are made or who are liable for the import tax are liable for payment of the tax relating to this transaction:
1° When they use the goods for non-eligible uses;
2° When they lend, rent or transfer the goods to persons other than the victims of the disasters concerned;
3° When they cease to be eligible persons.
The transactions mentioned in 2° of this B give rise to prior notification of the administration and, subject to the last paragraph of this B, to prior payment of the tax.
However, the tax is not due when the assets are transferred to an eligible person who allocates them to an eligible use. Where the goods have previously been used by disaster victims while being retained by the eligible person, the tax is also not due where they are transferred to a person entitled to benefit from the exemption with a view to distributing such goods free of charge to needy persons and actually using them for such use.
