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Tax Minimization in France

Tax Minimization in France

Updated on Monday 18th April 2016

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Tax minimization in France is used by business owners who want to take advantage of various strategies that help them reduce the amount of taxes due at the end of the financial year. Tax minimisation takes place in compliance with the current legislation for tax obligations and it is not a form of illegal tax avoidance. Our French lawyers can offer you complete information about the French taxation law.

Tax minimization strategies in France

 
Regardless of the type of business in France, a number of business strategies and investment strategies can help business owners cut back on their taxation liabilities. One tax strategy that can be implemented during the current fiscal year is to bring forward the tax deductions. The aim is to reduce the taxable income. Business owners who purchase gifts for employees or business partners can make anticipated purchases which will be deducted earlier in the year. The same strategy can be applied for various expenses businesses usually incur during the year, such as:
 
- repairs for your French property,
- office supplies,
- airline tickets,
- the fees for directors in France;
- the bonuses for employees etc.
 
Another strategy is to use the capital gains discount. Capital gains are treated as income and they are generally subject to corporate tax at the standard rate. However, capital gains can benefit from the participation exemption. In France, the participation exemption applies to capital gains derived from the sale of shares that are a part of a substantial investment. The condition for this to be applied is that the shares to have been held for 24 months.
 
Entrepreneurs can open a company in France to benefit from the separate legal entity of the company. The structure of a company can provide certain beneficial tax deductions. This, together with effective tax planning, will give you the possibility to balance and reduce taxes. 
 

Tax planning in France

 
Our lawyers in France can provide more information about other methods used for tax reduction and tax offsets that can be used when doing business in France. The tax year is generally the calendar year, although business owners can choose a different end date. Usually, the tax income return must be filled before May 31st for the previous tax year.
 
For more information about dividends in France and the corporate tax, please contact our French law firm. We can provide various legal services.

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