Do I have to pay the full CFE business tax this year?

There is a tax exemption for businesses with a very small turnover and depending on location, a special two-thirds reduction linked to Covid

27 November 2020
There may be a special two-thirds reduction this year linked to the Covid-19 crisis depending where in France you live
By Connexion journalist

Reader question: If you have had a bad income year as a small business due to Covid is there any reduction available for the CFE tax?

If you have paid this tax in the past it is likely you will have something to pay – eg. if you are not in one of the exempt professions, such as certain artisan jobs. This tax is not however payable in the first calendar year of business and is halved in the second one.

There is also an exemption for businesses with a very small turnover and, depending on where you live, there may be a special two-thirds reduction this year linked to the Covid-19 crisis.

The exemption is for turnover of less than €5,000 and is usually calculated based on turnover two years ago, so 2018 for this year’s bill (however the €5,000 must apply over a 12-month period so there will be pro-rata readjustments to the calculation for firms set up recently).

As for the special reduction, many, but not all, mairies and intercommunal bodies voted to do this and you can check if yours was one of them here and here

This tax is only levied by one or the other body, so check both lists to be sure. You can do a search using ‘Ctrl+F’ with the name.

Where payable it is calculated on a base amount multiplied by a percentage rate set by the mairie/intercommunal body. Where there are dedicated business premises this is the valeur locative cadastrale (theoretical rental value attributed by the tax office) of the property.

If you work from home the tax office uses a set minimum, fixed by the council within certain limits, for example currently €221 to €526 for turnover up to €10,000 and €221 to €1,050 for turnover to €32,600 (and then rising with further bands). Those with more than €3,000 in tax to pay will have paid an instalment in June, otherwise the tax is payable in full by December 15. If payable your bill should now be available in your professional account at impots.gouv.fr

If you disagree with your bill, contact your tax office for businesses.

Email your tax questions to news@connexionfrance.com

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