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Explains common M&A divergences such as long-term capital gains taxation on a reduced base and dividend exemptions under the parent-subsidiary regime. Summarizes recent developments including gradual CIT rate reductions, modified interest limitation rules aligned with ATAD, and facilitation of tax-neutral reorganization and merger roll-over elections. Includes sectioning for asset acquisitions, vehicles, financing, divestitures, transfer pricing and BEPS considerations, and appendices for tax treaty rates.",{"@graph":63,"@context":118},[64,80,101],{"@type":65,"itemListElement":66},"BreadcrumbList",[67,71,74,77],{"item":68,"name":69,"@type":70,"position":9},"https://docshare.wps.com","Home","ListItem",{"item":72,"name":10,"@type":70,"position":73},"https://docshare.wps.com/template/",2,{"item":75,"name":51,"@type":70,"position":76},"https://docshare.wps.com/template/general/",3,{"item":78,"name":59,"@type":70,"position":79},"https://docshare.wps.com/template/france-ma-tax-2022-guide/302642/",4,{"url":78,"name":59,"@type":81,"image":82,"author":87,"headline":59,"publisher":90,"fileFormat":93,"inLanguage":57,"description":61,"dateModified":94,"datePublished":95,"encodingFormat":93,"isAccessibleForFree":96,"interactionStatistic":97},"DigitalDocument",{"url":83,"@type":84,"width":85,"height":86},"https://docshare.wps.com/thumbnails/france-ma-tax-2022-guide/302642.png","ImageObject",442,249,{"name":88,"@type":89},"Logic","Person",{"url":68,"name":91,"@type":92},"DocShare","Organization","application/pdf","2026-09-23","2026-09-19",true,{"@type":98,"interactionType":99,"userInteractionCount":76},"InteractionCounter",{"@type":100},"ViewAction",{"@type":102,"mainEntity":103},"FAQPage",[104,110,114],{"name":105,"@type":106,"acceptedAnswer":107},"What are the main French legal entity categories discussed, and how do they differ for liability?","Question",{"text":108,"@type":109},"The document distinguishes companies and partnerships. Companies such as SA, SARL, and SAS generally are not liable for obligations beyond the corporate structure, whereas partners in SNC and SCI are responsible to the extent of their personal assets.","Answer",{"name":111,"@type":106,"acceptedAnswer":112},"How does the standard French CIT rate change for financial years starting from 2022?",{"text":113,"@type":109},"The document states the standard CIT rate is gradually reduced, reaching 25% for financial years open on or after 1 January 2022. It also presents progressive rate portions by turnover levels for 2019 through 2022.",{"name":115,"@type":106,"acceptedAnswer":116},"What changes are introduced regarding interest limitation rules and the reorganisation (tax-neutral merger) regime?",{"text":117,"@type":109},"New interest deduction limitation rules apply for periods open from 1 January 2019 and 1 January 2020 and implement the EU Anti-Tax Avoidance Directive (ATAD). For reorganisations, the tax-neutral election and eligible scope have been amended, including extensions and removal of certain formal commitments, supporting roll-over treatment and favorable merger conditions.","https://schema.org",{"og:url":78,"og:type":120,"og:title":59,"og:site_name":91,"og:description":61},"article",{"robots":122,"canonical":78},"index,follow",{"doc_id":124,"site_id":56},302642,1789794801,{"code":4,"msg":5,"data":127},{"doc_id":124,"user_id":128,"nickname":88,"user_avatar":129,"doc_module":9,"category_id":50,"category_name":51,"doc_title":59,"doc_description":61,"doc_content":130,"file_id":131,"file_url":132,"file_type":133,"file_size":134,"view_count":4,"is_deleted":4,"is_public":9,"is_downloadable":9,"audit_status":9,"page_count":135,"language":136,"language_code":57,"site_id":56,"html_lang":57,"table_of_contents":137,"faqs":138,"seo_title":139,"seo_description":61,"update_tm":125,"read_time":15},1099513958762,"https://ap-avatar.wpscdn.com/avatar/1000023916a998db790?x-image-process=image/resize,m_fixed,w_180,h_180&k=1784791008015729253","France  \n1. INTRODUCTION 2  \n2. RECENT DEVELOPMENTS 3  \n3. SHARE ACQUISITIONS 6  \n4. ASSET ACQUISITIONS 10  \n5. ACQUISITION VEHICLES 13  \n6. ACQUISITION FINANCING 13  \n7. DIVESTITURES 18  \n8. FOREIGN OPERATIONS OF A DOMESTIC TARGET 19  \n9. OTHER GENERAL INTERNATIONAL TAX CONSIDERATIONS 20  \n10. TRANSFER PRICING 20  \n11. POST-ACQUISITION INTEGRATION CONSIDERATIONS 21  \n12. OECD BEPS CONSIDERATIONS 21  \n13. ACCOUNTING CONSIDERATIONS 22  \n14. OTHER TAX CONSIDERATIONS 22  \n15. MAJOR NON TAX CONSIDERATIONS 23  \n16. APPENDIX I -TAX TREATY RATES 24  \n17. APPENDIX II -GENERAL CORPORATE ENTITY TAX DUE  \nDILIGENCE REQUESTS 30  \nCONTACT 33  \nFrance  \n1. INTRODUCTION  \na. Forms of Legal entity  \nFrom both legal and tax perspectives, two main categories of entities exist in France, companies and partnerships. The most common companies are:  \n• the joint stock company (société anonyme,“SA”), having minimum share capital is EUR37,000 .  \n• the limited liability company (société a responsabilité limitée, S.à r. l. ), having no minimum share capital.  \n• the simplified stock corporation (société par actions simplifiée,“SAS”), having no minimum share capital.  \nAlthough shareholders of these companies may forfeit their equity contributions, they are not responsible for the obligations and debts of the companies. These companies are subject to corporate income tax (“CIT”) .  \nThe most common partnerships are:  \n• the commercial partnership (société en nom collectif,“SNC”); and  \n• the French real estate company (société civil e immobil ière,“SCI”) whose purpose is to hold real estate assets.  \nPartners are responsible for the obligations and debts of the partnerships to the extent of their personal assets. No minimum capital is required. The tax results of a partnership are determined at the level of the partnership itself, but the tax on the results is assessed directly against the partners, such that a partner’s share of the losses of one partnership may offset that partner’s share of income from a different partnership.  \nb. Taxes, Tax rates  \nThe standard French CIT rate is being gradually reduced from 33.3% in 2017 to 25% for financial years open on or after 1 January 2022 (see section 2 for the applicable rates) . France does not assess local taxes on income.  \nThe top rate for personal income tax amounts to 45% .  \nc. common divergences between income shown on tax returns and local financial statements  \nIn France, there are several discrepancies between accounting and taxable income.  \nRegarding M&A transactions, the common divergences are as follows:  \n• Long-term capital gains : Capital gains derived from the sale of qualifying participations that have been held for at least two years are subject to CIT on only 12% of the gross capital gains, resulting in a taxation at an effective rate of up to 3% maximum.  \n• Dividends : dividends distributed under the parent-subsidiary regime are exempt up to 95% or 99% within a tax consolidated group.  \nTAXAND GLOBAL GUIDE TO M&A TAX 2022  \n2  \nFrance  \n2. RECENT DEVELOPMENTS  \na. Progressive reduction of the cIT rate:  \nFinance Laws for 2018, 2019 and 2020 provided for the following progressive reduction in the French CIT rate:  \n\n| Portions of taxable income | 2019 | 2020 | 2021*** | 2022*** |\n| --- | --- | --- | --- | --- |\n| Turnover \u003C €7.63 million* |  |  |  |  |\n| • €0 – €38,120 | 15% | 15% | 15% | 15% |\n| • €38,120 – €500,000 | 28% | 28% | 26.5% | 25% |\n| • >€500,000 | 31% |  |  |  |\n| Turnover 7.63 million – 250 million |  |  |  |  |\n| • €0 – €500,000 | 28% | 28% | 26.5% | 25% |\n| • >€500,000 | 31% |  |  |  |\n| Turnover >= €250 million |  |  |  |  |\n| • €0 – €500,000 | 28% | 28% | 27.5% | 25% |\n| • >€500,000 | 33.3%** | 31% |  |  |\n\n* Subject to compliance with the conditions set forth in Article 219, l-b of the CGI  \n** Thirty three and one third percent. The rate of 33.3% applies to fiscal years (“FY”) beginning in 2019 and ending on or after 6 March 2019  \n*** Turnover increase to EUR10 ","cbCaiqMKZO1Jxr0Z","https://ap.wps.com/l/cbCaiqMKZO1Jxr0Z","pdf",1446305,33,"English","# 1. Introduction\n## a. Forms of Legal entity\n## b. Taxes, Tax rates\n## c. Common divergences between accounting and taxable income\n# 2. Recent developments\n## a. Progressive reduction of the CIT rate\n## b. Interest limitation rules modified\n## c. Facilitation of the reorganisation regime\n# 3. Share acquisitions\n# 4. Asset acquisitions\n# 5. Acquisition vehicles\n# 6. Acquisition financing\n# 7. Divestitures\n# 8. Foreign operations of a domestic target\n# 9. Other general international tax considerations\n# 10. Transfer pricing\n# 11. Post-acquisition integration considerations\n# 12. OECD BEPS considerations\n# 13. Accounting considerations\n# 14. Other tax considerations\n# 15. Major non tax considerations\n# Appendix I - Tax treaty rates\n# Appendix II - General corporate entity tax due diligence requests\n# Contact","[{\"question\":\"What are the main French legal entity categories discussed, and how do they differ for liability?\",\"answer\":\"The document distinguishes companies and partnerships. Companies such as SA, SARL, and SAS generally are not liable for obligations beyond the corporate structure, whereas partners in SNC and SCI are responsible to the extent of their personal assets.\"},{\"question\":\"How does the standard French CIT rate change for financial years starting from 2022?\",\"answer\":\"The document states the standard CIT rate is gradually reduced, reaching 25% for financial years open on or after 1 January 2022. It also presents progressive rate portions by turnover levels for 2019 through 2022.\"},{\"question\":\"What changes are introduced regarding interest limitation rules and the reorganisation (tax-neutral merger) regime?\",\"answer\":\"New interest deduction limitation rules apply for periods open from 1 January 2019 and 1 January 2020 and implement the EU Anti-Tax Avoidance Directive (ATAD). For reorganisations, the tax-neutral election and eligible scope have been amended, including extensions and removal of certain formal commitments, supporting roll-over treatment and favorable merger conditions.\"}]","France - M&A Tax 2022 Guide | PDF"]