The rates payable by a small business in France have been increased this year in line with inflation, and in some cases there has also been a revision of rateable values.
The system of small business rates in France is called the Cotisation Foncière des Entreprises (CFE).
The CFE is in fact made of up two components - the Contribution Economique Territoriale (CET) and the Cotisation sur la Valeur Ajoutée des Entreprises (CVAE). However, only those companies with a turnover in excess of €500K pay the CVAE.
The rates are determined from the value of the real estate you use to run the business, or the rent you pay if you are a tenant.
This year rental values on commercial property and offices (locaux professionnel) are being revised for the first time since 1970. The rateable values of residential property do not form part of the review of that has taken place.
Some commercial properties will see a fall in their rateable value, but where there is an increase the increased rates payable are being phased in over 10 years.
Even though you may work from home you are still liable for the tax, although normally only at the minimal rate.
There are a number of exemptions from the tax, some permanent and some temporary.
One of the most significant permanent exemptions are artisans who work alone or within a family business. Others include agricultural activities and artists/authors, and certain business activities in development areas.
Owners of a chambre d'hôte or classified gîte accommodation are also exempt (unless the local council decides otherwise), provided the property is either their principle residence or second home.
The level of the rates payable is determined locally, but within parameters set by central government, revised upwards each year in line with inflation. They are up this year by under 1%.
There are six rate bands, depending on the turnover of the business, as follows:
|Small Business Rates 2017|
|≤ €10,000||€214 - €510|
|> €10,000 ≤ €32,600||€214 - €1,019|
|> €32,600 ≤ €100,000||€214 - €2,140|
|> €100,000 ≤ €250,000||€214 - €3,576|
|> €250,000 ≤ €500,000||€214 - €5,095|
|> €500,000||€214 - €6,626|
Most smaller councils set the minimum rate towards the lower end of each range.
The reference year used for determining the turnover figure is two years prior to the year of imposition. The tax is not payable in the first year of the business, and payable at the rate of 50% in the second year.
It is collected via the national tax authority, who will send you an on-line tax notice. They also collect a small management charge on behalf of the councils and themselves, which is added to the rates payable.
The tax is payable by 15th December, and can also be paid monthly by prior registration.