Join us for an informative update on the latest government actions in France impacting the economy and employee mobility.
WHAT IS GOING IN FRANCE CURRENTLY?
- A strict lockdown requiring people in France to remain at home came into effect on March 17.
- One is not allowed to travel over 100 km from our home unless we have an imperative family or professional reason to do so. You must complete a declaration for those trips.
- Wearing a mask is mandatory in public transport and recommended everywhere else.
- Working from home must be preferred whenever possible.
WHAT IS THE ECONOMY IMPACT OF CORONAVIRUS?
- A decrease of 8.2% of the gross domestic product is expected for 2020.
- The government announced several measures to support the economy during the month of March and April.
- State-backed loans were introduced
- 12 million workers are unemployed and covered by the special unemployment scheme
WHAT IS THE TAX RELIEF?
- Deadlines for filing certain tax returns as well as the deadlines to realize certain tax formalities have been postponed.
- The start date for submitting income tax returns has been postponed from April 9, 2020 to April 20, 2020. Additionally, the deadline for submitting such tax returns vary from region to region and according to the filing process have been postponed from June 4, 2020 to June 12, 2020.
- For other tax returns, such as companies and businesses, all deadlines for filing tax returns and other similar declarations in May are postponed to June 30, 2020.
- Finance Act was adopted on Thursday 23 April 2020 providing with several tax measures:
- Exemption from corporate tax, income tax, and all social contributions on sums paid to businesses by the solidarity fund created by the government on March 25.
- Landlords are allowed to deduct from their taxable profits the loss resulting from a rent waiver without the landlord needing to have a commercial motive.
- A reduced 5.5% VAT rate will apply on:
- protective masks and protective clothing suitable for epidemic control & products intended for personal hygiene
- If a person is temporarily prevented from leaving France due to COVID-19, it is considered as a case of force majeure.
- Measures have also immediately been taken after the announcement of the lockdown for employees working in the frontier areas (Belgium, Luxemburg, Germany and Switzerland). Those employees will remain taxable in France on 100% of their remuneration even if they work from home more than the number of days authorized by tax treaties.
- This is the same for social contributions: during the Covid period, all restrictions of employment in EU countries based on article 13 of the EU regulation 883/2004 are frozen. Temporary work from home in the country of residence will not be considered.