Taxation

A EURL can now opt for business tax in its statutes

Publié le 18 mars 2024 - Directorate for Legal and Administrative Information (Prime Minister)

A single-member private company with limited liability (EURL) which declares in its articles of association that it is covered by the business tax system (IS) and which, from the first financial year of its business, files its income tax returns under that tax system, shall be deemed to have regularly opted for that tax. That is what the Conseil d’État said in a ruling delivered on February 5, 2024.

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Image 1Crédits: chaylek - stock.adobe.com

A private limited-liability company whose sole shareholder is a natural person (in other words a EURL) challenges before the administrative court the increases in profits subject to business tax and its liability to tax.

It should be recalled that a EURL is automatically subject to the income tax system unless it opts for the SI. This option is:

  • or by notification before the end of 3e the month of the fiscal year for which the company wishes to be filed for the firstre times to IS;
  • or by ticking the box provided on the form given to the companies' formalities center or to the registry of the commercial court on which they depend when declaring their creation or modification.

The Administrative Court of Appeal dismisses EURL’s application and does not question its liability to the SI because the manager who checked the box BIC: titleContent in the companies formality center form, the sole partner was not. EURL is appealing to the Conseil d’État (Council of State) on a point of law.

The Council of State confirms the decision on appeal. In its view, when an EURL declares in its statutes to be a part of the IS, it opts for that tax system. This option shall be deemed to have been regularly exercised when the EURL files its income statements under the SI scheme from its first business year.

So the choice of ISIS is clear.

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