France Corporate Tax Guide (Impôt sur les Sociétés — IS)
the French corporate income tax (Impôt sur les Sociétés — IS). The guide covers: the standard corporate tax rate (25% for all companies from 2022 onwards, reduced from the former 33.33% rate; the reduced rate of 15% on the first €42,500 of taxable profit for SMEs meeting certain thresholds — turnover under €10 million, share capital fully paid up, and at least 75% owned by individuals; the social solidarity contribution (Contribution Sociale sur les Bénéfices — C3S) of 0.19% on turnover above €19 million, with a cap; the additional exceptional contribution (Contribution Exceptionnelle sur l'Impôt sur les Sociétés — CEIS) of 33% of the corporate tax for companies with turnover over €250 million and the surcharge of 15% for companies with turnover over €3 billion; the territoriality rules — companies are taxed on their worldwide profits if they are established in France, but foreign branches are taxable in France with a foreign tax credit (the "règle du crédit d'impôt" under Article 209-I of the CGI — the "Code Général des Impôts"); the tax consolidation regime (Régime d'Intégration Fiscale) — groups of companies with at least 95% ownership can elect to file a consolidated tax return, offsetting profits and losses across the group; the depreciation rules — the declining-balance method (amortissement dégressif) for certain assets, the straight-line method (amortissement linéaire) for others; the tax depreciation of buildings is allowed; the research tax credit (Crédit d'Impôt Recherche — CIR) — 30% of eligible R&D expenses up to €100 million and 5% above, one of the most generous in Europe; the innovation tax credit (Crédit d'Impôt Innovation — CII) — 20% of innovation expenses up to €400,000; the reduced corporate tax rate for long-term capital gains on shares (participation exemption — Régime des Plus-Values à Long Terme) — the "régime mère-fille" (parent-subsidiary regime) exempts 95% of dividends received from qualifying subsidiaries; the corporate tax payment schedule — four quarterly instalments (acomptes) due on 15 March, 15 June, 15 September, and 15 December, with a balance payment (solde) due on 15 April of the following year; the tax return deadlines — the annual tax return (Liasse Fiscale) must be filed within 3 months of the end of the fiscal year (companies with a 31 December year-end must file by 31 March or 30 April for electronic filing).
France has one of the highest corporate tax burdens in the OECD despite recent rate reductions, but the generous R&D credits and the participation exemption provide significant relief. All amounts in Euros (EUR). For related reading, see our Personal Tax Guide →, VAT Guide →, and Starting a Business Guide →.
Corporate Tax Rate
- Standard rate — 25%: From 1 January 2022, the standard corporate tax rate (taux normal de l'IS) is 25% on all taxable profits. The rate was progressively reduced from 33.33% (2016) to 28% (2018–2021), then to 25% from 2022. The rate applies to all companies regardless of turnover, except for the reduced rate for SMEs.
- Reduced rate — 15%: SMEs (Petites et Moyennes Entreprises — PME) meeting the following conditions benefit from a 15% rate on the first €42,500 of taxable profit: (a) turnover under €10 million, (b) share capital fully paid up, (c) at least 75% owned directly or indirectly by individuals (or by a company itself owned at least 75% by individuals), (d) taxable profit does not exceed €42,500 for the reduced rate portion. Profit above €42,500 is taxed at 25%.
Surcharges and Contributions
- Social solidarity contribution (C3S): The Contribution Sociale de Solidarité sur les Bénéfices (C3S) is a tax of 0.19% on the turnover of companies with turnover over €19 million. The C3S is deductible for corporate tax purposes. The C3S replaces the former Contribution Sociale sur les Bénéfices (which was a surcharge on the corporate tax itself).
- Exceptional contribution (CEIS): The Contribution Exceptionnelle sur l'Impôt sur les Sociétés (CEIS) is a surcharge of 33% of the corporate tax due for companies with turnover over €250 million, plus an additional 15% surcharge for companies with turnover over €3 billion. The CEIS applies for fiscal years ending on or after 1 January 2025.
Participation Exemption (Régime Mère-Fille)
- 95% exemption on dividends: A parent company that holds at least 5% of the share capital of a subsidiary for at least 2 years can benefit from the "régime mère-fille" — 95% of dividends received are exempt from corporate tax (5% is treated as non-deductible expenses — the "quote-part de frais et charges"). The exemption applies to both French and foreign subsidiaries (subject to the EU Parent-Subsidiary Directive or a tax treaty).
- Long-term capital gains (plus-values à long terme): Capital gains on the sale of qualifying shares (held for at least 2 years) are taxed at a reduced rate of 0% for shares held for more than 2 years (with 12% of the gain treated as non-deductible expenses under the "quote-part" rule). The participation exemption applies to shares representing at least 5% of the subsidiary's capital.
Tax Incentives
- Research Tax Credit (CIR): The Crédit d'Impôt Recherche — 30% of eligible R&D expenses (salaries of researchers, depreciation of R&D assets, operating costs, subcontracting costs) up to €100 million, and 5% above €100 million. The CIR is calculated per company and can be carried forward 3 years or refunded after that (immediate refund for young innovative enterprises — JEI, SMEs, and new companies). The CIR is the most generous R&D tax credit in Europe.
- Innovation Tax Credit (CII): The Crédit d'Impôt Innovation — 20% of eligible innovation expenses (excluding R&D) up to €400,000. Eligible expenses include: design, prototyping, and pilot testing of new products. The CII is available for SMEs (fewer than 250 employees and turnover under €50 million).
For the full corporate tax filing requirements and payment schedule, see our Tax Filing Procedures Guide →. For the corporate tax treatment of cross-border operations, see our Cross-Border Tax Guide →.