Natural or legal persons exercising a self-employed activity are required to pay the business property contribution (CFE) each year.
The CFE is, along with the business value added contribution (CVAE), one of the components of the territorial economic contribution (CET). This tax is based only on property subject to property tax. All the explanations.
The business property tax is a tax payable by professionals who regularly carry out a self-employed activity on the 1 st January of the tax year. It is based on the rental value of property subject to property tax and due in the municipalities where the company has premises or land.
Are concerned by the payment of the CFE the companies and individuals who carry out a self-employed activity, whatever their legal status, the nature of their activity, their tax regime and their nationality.
Companies with a turnover of less than or equal to 5000 euros are exempt from CFE. Similarly, the rental and subletting activities of bare buildings for residential use are not affected as long as they do not fall within the scope of a professional activity. Finally, this tax does not apply to the furnished rental of certain accommodation forming part of the owner's main residence.
More specifically, certain professionals are automatically exempt, including taxi drivers, independent door-to-door sellers, press services and agencies, lawyers, private educational establishments and public authorities. Others may benefit from a temporary exemption subject to meeting certain conditions.
As mentioned above, the tax base of the CFE is made up of the rental value of property subject to property tax used by the company for the purposes of its professional activity during year N-2. For example, for the contribution due in 2020, it is the goods used in 2018 that will be taken into account.
This tax base is reduced in certain cases:
When the rental value is very low or in the absence of premises, the CFE is established on the basis of a minimum flat-rate contribution, the amount of which is set by the municipality according to the turnover achieved in N-2. The scale of the minimum CFE base is updated each year. It is for example between 221 and 526 euros (CFE due for 2020) for a turnover less than or equal to 10,000 euros.
The amount of the CFE thus corresponds to the product of the tax base and the tax rate decided by each municipality. To find out the rate applied by your municipality, do not hesitate to contact the business tax department (SIE).
Companies and individuals who have to pay the CFE are not required to declare their tax bases for this tax each year. However, a 1447-M declaration must be filed before the 2 th working day following the 1 st May by companies requesting to benefit from an exemption, who wish to report a change or modification of the surface area of the goods subject to this tax, a variation in the number of employees, of an element of the tax, an overrun of the threshold of 100,000 euros, a cessation or closure of their establishment.
After the declaration, it is possible to consult his CFE opinion by going to his professional space, then to the "My services" section. Finally, just click on "View> CFE Notice". The page "Table of CFE tax notices" summarizes the CFE notices by year.
The payment of the business property tax is made in two instalments:a deposit corresponding to 50% of the amount of the tax collected for the previous year must be paid before June 15 of the current year (this deposit is only due if the amount of the CFE is greater than 3,000 euros). The balance must be paid no later than December 15 of each year. Therefore, if no installment has been paid, the full tax must be paid at the end of the year.
Regarding the method of payment of the CFE, the taxpayer has the choice between online payment via the tax account, the monthly direct debit subject to joining before June 30, the direct debit at maturity.
In the event of cessation of activity during the year or if his tax base risks being reduced by at least 25% compared to year N-1, the taxpayer may obtain a reduction. For this, he must submit a written, dated and signed declaration to the public accountant in charge of collection no later than 15 days before the due date of the deposit.
If you need more information on the business property tax, you can contact the business formalities centre. The center on which you depend is determined according to your activity (commercial, artisanal, agricultural or liberal), your legal status and the place of exercise of this activity.
Individual entrepreneurs or companies carrying out a commercial activity depend, for example, on the Chamber of Commerce and Industry (CCI). Individual entrepreneurs or companies carrying out a craft activity depend on the Chamber of Craft Trades (CMA). Individual entrepreneurs exercising a liberal profession depend on the URSSAF. As a reminder, the PACTE law plans to simplify the creation of a business by 2023 by replacing the CFE networks with a single electric window which will be the only interface for business formalities.
