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    Employment Competitiveness Tax Credit

    If your company is located in metropolitan France and employs employees, the CICE rate it can benefit from is reduced for remuneration paid in 2018.

    To finance their competitiveness, companies employing employees can benefit from the tax credit for competitiveness and employment (CICE) since 2014.

    Companies subject to corporation tax or income tax, on the basis of their actual profit (exclusion of micro-enterprises), regardless of their sector of activity, with employees can benefit from the ICCE, which was set at 7% for remuneration paid since 1 January 2017. The ICES is calculated on the gross amount of compensation paid to employees, which does not exceed Smic 2.5 over the calendar year.

    Companies subject to corporation tax or income tax, on the basis of their actual profit (exclusion of micro-enterprises), regardless of their sector of activity, with employees can benefit from the ICCE, which was set at 7% for remuneration paid since 1 January 2017. The ICES is calculated on the gross amount of compensation paid to employees, which does not exceed Smic 2.5 over the calendar year.

    For remuneration paid on or after 1 January 2018 by companies domiciled in mainland France, the CICE rate is reduced to 6%.

    To note. For companies located in the French overseas departments, the CICE rate remains at 9% in 2018.

    Imputation on your income tax. When you send the annual declaration of your 2019 income tax return, you will be able to deduct the amount of your CICE 2018 for salaries paid in 2018 from your IS or IR for the financial year 2018.

    Good to know. The unallocated excess of the CCTB over the 2018 tax will be a receivable with which you will be able to pay your IS or IR due for the next 3 years (2019,2020 and 2021).

    The CICE will be abolished for remuneration paid from 2019 onwards and replaced by a 6 point reduction in the health insurance contribution payable by employers under the general social security and agricultural schemes on remuneration not exceeding 2.5 SMIC.

    To note. The wage tax credit, the CITS, which has a rate of 4% on remuneration not exceeding 2.5 SMIC and which is a CICE for non-profit organisations, will also be abolished as from 2019 and replaced by a 6 point reduction in the employer’s health insurance contribution.

    Source : LF pour 2018, art. 86 et LFSS pour 2018 art. 9

    © Copyright Editions Francis Lefebvre