9. Taxation of Business Profits in France

1. 9.1. Main Options
2. 9.2. Micro-Entreprise
3. 9.3. Regime Réel
4. 9.4. Company Tax
5. 9.5. Dividends

9.1. Main Business Taxation Options in France

Broadly speaking, the basis on which you will be taxed will depend on the legal structure of the business and your level of turnover.

If you are a sole trader (Entreprise Individuelle (EI)) you are automatically taxed under the personal income tax system. You have the choice of being taxed either as a micro-entreprise, or through the rules of regime réel.

If you have set up as a limited company in sole proprietorship (EURL) then you may elect to be taxed under personal income tax system through the rules of regime réel, or through the system of company taxation.

A private limited company in joint ownership (SARL) can only be taxed under company tax, unless it is a special type of family business, or a small company under 5 years old, when it can elect to be taxed under the personal income tax system.

We can, therefore, summarise the three main tax regimes as follows:

• Micro-Entreprise
• Regime Réel
• Impôts sur les societies