Aid has been set up to support companies affected by the health crisis. Should this aid be included in the taxable income? Answer at the time of the tax returns.
Financial aid. Your company may have been able to apply for direct aid of up to €1,500 from the solidarity fund, particularly if it has been closed down by decision of the administration, or if it has suffered a loss of turnover of at least 50%. In addition, it could apply for additional aid of between €2,000 and €5,000 if it had one employee, could not pay its debts within 30 days and was refused a cash loan. Finally, the Council for the Social Protection of the Self-Employed (CPSTI) has set up an exceptional financial aid for all merchants and craftsmen, without any steps to be taken, the amount of which corresponds to the supplementary pension contributions paid on the basis of their 2018 income and can be up to €1,250. If you were not able to benefit from these aids, your company may have been able to benefit from the exceptional financial aid paid by the CPSTI to self-employed workers.
… not taxable. The cumulative amount of these aids can thus reach up to 9 250 €. And fortunately, it will not have to be included in your company’s taxable income, nor in your professional income on your income tax return.
What about the government guaranteed loan? An exceptional government guarantee is granted for loans granted from March 16, 2020 to June 30, 2021 inclusive to non-financial companies registered in France, by credit institutions and finance companies. The amount of the loan granted to your company is capped at 25% of the turnover excluding VAT in 2019 (i.e. three months of turnover). The repayment of the loan is deferred for a minimum of 12 months and then spread over a period of up to five years.
Tax treatment. The tax treatment here is the same as for any loan made by your company. The amount borrowed is not taxable and the repayments are non-deductible, except for the loan interest.
Nicolas BRAHIN
Lawyer of the Bar of Nice
Specialist in banking and financial law
Panthéon-Sorbonne University
Cabinet BRAHIN Avocats
