B: Determination of taxable income

I. - 1. Farmers subject to an actual taxation system may make a deduction for precautionary savings, the amount of which is capped, per twelve-month financial year:

a) 100% of taxable profits, if less than €28,612;

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b) To the sum of €28,612 plus 30% of the profit in excess of this limit, where it is greater than or equal to €28,612 and less than €52,985;

c) To the sum of €35,924 plus 20% of the profit in excess of €52,985, where this is greater than or equal to €52,985 and less than €79,478;

> d) To the sum of €41,222 plus 20% of the profit in excess of this limit, where this is greater than or equal to €28,612 and less than €79,478 e) To the sum of €43,872, where the taxable profit is greater than or equal to €105,970. For joint farming groups and limited liability farms that have not opted for the capital company tax regime, the ceilings mentioned in a to e are multiplied by the number of farming partners, up to a limit of four, without being able to exceed the amount of the taxable profit.

2. The deduction is also capped:

1° For sole proprietors, to the positive difference between the sum of €150,000 and the amount of deductions made and not yet credited to income;

2° For joint farming groups and limited liability farms that have not opted for the capital company tax system, the positive difference between the sum of €150,000, multiplied by the number of farming partners, up to a limit of four, and the amount of deductions made and not yet included in the result. 3. The deduction referred to in 1 is made after application of the allowances provided for in articles 44 duodecies, 44 terdecies, 44 quaterdecies and 73 B.

4. The amounts mentioned in 1 of this I are updated each year according to the change in the consumer price index excluding tobacco recorded for the previous year and rounded to the nearest euro. These revalued amounts apply to the determination of taxable income for financial years ending on or after 1 January of the year in respect of which the adjustment is made.

I. II. - 1. The deduction provided for in I of this article is made on condition that, within six months of the end of the financial year and no later than the deadline for filing the income tax return relating to the financial year in respect of which the deduction is made, the farmer has deposited a sum of between 50% and 100% of the amount of the deduction in a current account opened with a credit institution. The business savings thus built up must be entered as assets on the farm's balance sheet. At all times, the total amount of business savings must be at least equal to 50% of the amount of deductions not yet reported. It may never exceed the amount of deductions not yet reported. The condition of entry in the current account referred to in the first paragraph of this 1 is deemed to have been satisfied up to the amount of the costs incurred during the financial year in respect of which the deduction is made for the acquisition or production of stocks of fodder intended for consumption by the animals on the farm or stocks of products, in particular wine-growing products, or animals, the rotation cycle of which is greater than one year. For the purposes of assessing whether the professional savings condition laid down in the same first subparagraph has been met, the savings deemed to have been constituted up to the amount of the costs mentioned in the first sentence of this subparagraph may replace all or part of the sum entered in the current account mentioned in the first subparagraph.

In the event of the sale of stocks of fodder for consumption by the farm's animals or stocks of products, in particular wine-growing products, or animals, with a rotation cycle of more than one year. In the event of the sale of the fodder stocks or stocks of products or animals mentioned in the second paragraph of this 1, a proportion of the proceeds of the sale is entered in the current account mentioned in the first paragraph up to an amount at least equal to the difference between 50% of the amount of the deductions not yet reported and the total professional savings reduced by the share of the costs of acquisition or production of the fodder stock or stock of products or animals subject to the sale deemed to have been allocated to the current account. Failing this, the fraction of the deduction not yet deducted that exceeds twice the professional savings is deducted from the profit for the financial year.

The current account referred to in the first paragraph of this 1 relates exclusively to the transactions defined in I.

For a farmer who is a cooperative member of a société coopérative agricole mentioned in article L. 521-1 of the Rural and Maritime Fishing Code or a member of a producer organisation or an association of producer organisations recognised in accordance with article L. 551-1 of the same code and benefiting from the transfer of ownership of the products they market, the appropriation account may be an account on the assets side of the farmer's balance sheet which records exclusively receivables relating to the funds he makes available to the cooperative, producer organisation or association of producer organisations when, under a multi-year contract concluded with them, the price at which he sells his produce exceeds a reference price set in the contract.

2. The sums deducted are used over the course of the ten financial years following the year in which the deduction was made to meet expenditure required by the professional activity. These sums are carried forward to the profit or loss for the financial year during which they were used or to the profit or loss for the following financial year.

3. Where these sums are not used during the ten financial years following the financial year in respect of which the deduction was made, they are carried forward to the profit or loss for the tenth financial year following the financial year in respect of which the deduction was made.

In the event of failure to comply with the above conditions, the deduction is carried forward to the next financial year. In the event of non-compliance with the obligation set out in the penultimate sentence of the first paragraph of 1 of this II, the fraction of the deductions not yet reported that exceeds double the professional savings is reported against the result for that financial year, increased by an amount equal to the product of this sum multiplied by the rate of late payment interest set out in article 1727.

>. 4. Article 151 septies does not apply to capital gains on the sale of rolling stock acquired during a financial year in respect of which the deduction was brought back and in the two years preceding their sale.

Subject to the application of Articles 151 septies and 151 septies, the capital gains on the sale of rolling stock are not subject to the provisions of Article 151 septies. Subject to the application of articles 41, 151 octies and 238 quindecies, the first paragraph of this 4 does not apply to capital gains realised on the cessation of the business as a result of the retirement of the operator, the transfer of the business free of charge, the transfer of the sole proprietorship or an entire branch of activity to a company, the dissolution of the company or the death of the operator. However, if the transferee or the beneficiary of the contributions is a company related to the transferor or the contributor, within the meaning of Article 39, paragraph 12, the capital gain generated on the subsequent transfer of the asset by the latter, realised within a period of two years from the date on which the asset is entered on the balance sheet of the transferor or the contributor, does not benefit from the provisions of Article 151 septies.

III. III. - The gratuitous transfer of a sole proprietorship under the conditions set out in article 41 by a farmer who has claimed the precautionary savings deduction in respect of a financial year preceding that of the transfer is not considered, for the application of I and II of this article, as a cessation of activity if the beneficiary or beneficiaries of the transfer meet the conditions giving entitlement to the deduction and use the sums deducted by the transferor during the ten financial years following that in respect of which the corresponding deduction was made under the conditions and within the limits defined in the same I and II.

The transfer of an individual farm under the conditions set out in I of article 151 octies to a non-trading agricultural company by a farmer who has made the deduction for precautionary savings in respect of a financial year preceding that of the transfer is not considered, for the application of I and II of this article, as a cessation of activity if the company receiving the contribution fulfils the conditions laid down in the same I and II and uses the sums deducted by the farmer during the ten financial years following the one in respect of which the corresponding deduction was made under the conditions and limits defined in the said I and II.

A merger, demerger or partial contribution of assets carried out by a company mentioned in the second paragraph of I of article 151 octies A, under the conditions provided for in the same I, which has applied the deduction for precautionary savings in respect of a financial year preceding that during which this operation is carried out is not considered, for the application of I and II of this article, as a cessation of activity if the acquiring or beneficiary company fulfils the conditions laid down in I and II and uses the sums deducted by the company during the ten financial years following that in respect of which the corresponding deduction was made, under the conditions and within the limits defined in I and II.

IV. - At the taxpayer's option, I of article 163-0 A applies to the deductions deducted from the result for the financial year established at the time the company ceases trading pursuant to article 201. This option is exclusive of the option provided for in article 75-0 C.

V. - The profits of operators holding income mentioned in the fifth or sixth paragraphs of article 63 may not give rise to the deduction provided for in this article, when these operators do not carry out any of the activities mentioned in the first, second, third or fourth paragraphs of article 63.

VI. - The benefit of the deduction is subject to compliance with Commission Regulation (EU) No 1408/2013 of 18 December 2013 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid in the agriculture sector, Commission Regulation (EU) No 717/2014 of 27 June 2014 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid in the fisheries and aquaculture sector or Commission Regulation (EU) No 1407/2013 of 18 December 2013 on the application of Articles 107 and 108 of the Treaty on the Functioning of the European Union to de minimis aid.