Coronavirus: French tax payments and repayments

Out-Law Guide | 20 Mar 2020 | 4:34 pm | 3 min. read

The French tax authorities have announced extraordinary measures to defer tax payments and accelerate tax rebates.

Tax deferral

Companies can postpone for three months, without penalty, payment of corporation income tax, payroll taxes, business tax (Contribution sur la Valeur Ajoutée des Entreprises – CVAE) and property taxes.

No conditions need to be satisfied or justification given, other than a request for postponement.  This request must be made using the 'Difficulties related to Coronavirus - Covid 19 Request for payment and/or tax rebate request' form ('Difficultés liées au Coronavirus – Covid 19 Demande de délai de paiement et/ou de remise d’impôt') available on the impots.gouv.fr website.

VAT and similar taxes are excluded from the measure, as is the payment of withholding tax deducted from payments.   

If payments for March have already been arranged, companies can cancel the SEPA direct debit with their online bank, if they still can. If not, companies can request reimbursement of the direct debit corresponding to the March payment.

Companies can request the speeding up of the processing of tax credit refunds such as those relating to VAT, research tax credit (CIR), innovation tax credit (CII) and tax credit for employment and competitiveness (CICE). To request this, companies should use the simplified tax form 'Difficulties related to Coronavirus - Covid 19' form, box 3, mentioning the amount of the debt awaiting payment, the debtor organisation and send it to their corporate tax office, Service des Impôts des Entreprises.

It is possible to obtain early repayment of the overpayment of corporate income tax for 2019, without waiting for early May 2020. Businesses should contact Service des Impôts des Entreprises or, for large companies, the Direction des Grandes Entreprises.

Social contributions

Employers whose URSAFF (Union de recouvrement des cotisations de sécurité sociale et d’allocations familiales) due date falls on the 15th of the month may postpone, without penalty, all or part of the payment of their employee and employer contributions, from 15 March 2020. The date of payment of these contributions may be postponed up to three months.

For employers whose deadline falls on the 5th of the month, information will be communicated to them later, with a view to the deadline of 5 April.

If the employer does not wish to opt for a deferral of all contributions and prefers to pay employee contributions, it can stagger the payment of employer contributions, as usual. To do this, companies should login to their online space on urssaf.fr and report their situation via the messaging system: 'New message / A reporting formality / Report an exceptional situation'. It is also possible to contact URSSAF by phone, dialing 3957.

A postponement or a deadline agreement is also possible for supplementary pension contributions.

Tax rebates

Requests for direct tax rebates must be justified by proper documentation. Rebates can only be granted in the event of serious difficulties that a deferral of payment is not enough to overcome. Rebates will therefore be considered individually after examining the situation of each taxpayer.

This measure concerns the payment of all direct taxes.

The request must be made using the 'Difficulties linked to Coronavirus - Covid 19 Request for payment and / or tax rebate request' form, available on the impots.gouv.fr website. The application must be completed with relevant information and documents needed to assess the economic situation of the requester and the consequences of the health crisis on its tax debt situation.

Measures for the self-employed

Workers can adjust the rate and withholding tax on salaries (Prélèvement à la Source - PAS) at any time. It is also possible to defer the payment of withholding taxes on professional income up to three times each month if the instalments are made on a monthly basis, or from one quarter to the next if the instalments are made on a quarterly basis.   

The measures are accessible via the taxpayer's individual area on impots.gouv.fr under the heading 'Manage my direct debit at source' (Gérer mon Prélèvement à la Source). Any action made before the 22nd of the month will be taken into account for the following month. 

Impact on the accounts closed on 31 December 2019

It is not possible to adjust the accounts closed on 31 December 2019 by taking into account the difficulties linked to the health crisis.

This is because the epidemic and its consequences are events after the end of the 2019 financial year and are therefore not such as to allow the results of the financial year ended 31 December 2019 to be adjusted downwards. Companies must however provide suitable information in the appendix and in their management reports.

Measures concerning individuals

For the time being, no action has yet been taken on the personal income tax return for which the deadline for filing paper forms is scheduled for 14 May 2020.