French Corporate Income Tax Surcharge of 3% on Dividends: Claims to be filed now

Supreme Court decisions of June 27, 2016
French companies should take precautionary action now in order to claim the French corporate income tax surcharge of 3% paid in 2014, 2015 and 2016.

Following the transmission of constitutional referrals to the Supreme Court based on the conformity of the 3% tax provided in the article 235 ter ZCA of the French Tax Code to the constitutional principles requiring the ability to pay to be taken into account under articles 6 and 13 of the Declaration of the Rights of Man and the Citizen, the Supreme Court, has just decided, by 4 decisions (n°398585, 399024, 399506 and 399757), to refer:

  • Two prejudicial questions to The EU Court of Justice on the non-conformity of the 3% tax with the articles 4 or 5 of the Parent/Subsidiary Directive 2011/96/UE
  • A constitutional question to The French Constitutional Court related to the inequality of treatment between corporations regarding the exemption of the 3% tax provided only for companies members of a tax consoli-dated group.

The French Constitutional Court has now 3 months to render its decision.

In the meantime, in order to protect against such a limiting effect, we recommend:

  • Urgently to file claims to the tax authorities for the 3% tax paid in 2014, 2015 and 2016
  • Urgently to submit claims before the relevant lower Administrative Court for those clients who have already filed claims to the tax authorities and have not received an express rejection within a six-month time limit following the receipt of the claim by the tax authorities.
Michel Guichard

Michel Guichard, Partner, leads the Indirect Tax activity. With more than 30 years’ experience in International and French Tax law, he advises his clients on indirect tax matters. Michel is […]