Tax treatment of business managers' remuneration

What tax is imposed on executive pay?

In an anonymous business, the remuneration of the following managers is subject to income tax:

• Chairman of the Management Board or Supervisory Board
• Managing Director and Deputy Managing Director
• Members of the Executive Board, members of the Management Board or of the Supervisory Board, who also perform a technical function as an employed person within the company

How much must be declared by officials?

Any remuneration received by business managers subject to business tax (IS) is subject to the progressive income tax (IR) schedule, in the salary and wages category. Such remuneration may be the basic salary, a bonus, a bonus, a benefit in kind, a profit sharing results, for example.

That remuneration shall be subject to the flat-rate deduction of 10%. However, leaders can choose to deduct their actual business expenses and justified.

For example, an executive receives a salary of €100,000, flat-rate allowances for the cost of €15,000. Its actual justified professional costs are €35,000. The amount to be reported will not be the same depending on whether or not he opts for the actual fee regime.

For business, executive pay is a deductible charge they correspond to actual work and are not excessive in relation to the duties performed.

Such remuneration may be subject to the payroll tax if the business is not or has not been subject to VAT on 90% at least its turnover.

Presence token

There are 2 types of presence tokens:

• Ordinary tokens paid to members of the supervisory board and directors are taxed in the category of income from movable property
• Special attendance fees paid to directors performing managerial functions are taxed in the salary and salary category.

Ordinary presence tokens are subject to the single flat-rate plan (PFU or flat tax). A standard levy of 12.8% and social security contributions of 17.2% is made on the presence tokens. An option for imposition on the progressive scale is possible.

Attendance tokens are tax deductible for business up to a certain limit.

It all depends on the number of employees in the anonymous business.

What tax is imposed on executive pay?

In a simplified share business or a single-person simplified share business, the remuneration of the following directors shall be subject to income tax:

• President
• Other management bodies established by the Statute. The latter determine the power of fixation and the method of remuneration.

How much must be declared by officials?

Any remuneration received by business managers subject to business tax (IS) is subject to the progressive income tax (IR) schedule, in the salary and wages category. Such remuneration may be the basic salary, a bonus, a bonus, a benefit in kind, a profit sharing results, for example.

That remuneration shall be subject to the flat-rate deduction of 10%. However, leaders can choose to deduct their actual business expenses and justified.

For example, an executive receives a salary of €100,000, flat-rate allowances for the cost of €15,000. Its actual justified professional costs are €35,000. The amount to be reported will not be the same depending on whether or not he opts for the actual fee regime.

For business, executive pay is a deductible charge they correspond to actual work and are not excessive in relation to the duties performed.

Such remuneration may be subject to the payroll tax if the business is not or has not been subject to VAT on 90% at least its turnover.

What tax is imposed on executive pay?

In a business with limited liability, the remuneration of the following directors is subject to income tax:

• Minority or equal manager
• Non-associate manager who is actually working

How much must be declared by officials?

Any remuneration received by business managers subject to business tax (IS) is subject to the progressive income tax (IR) schedule, in the salary and wages category. Such remuneration may be the basic salary, a bonus, a bonus, a benefit in kind, a profit sharing results, for example.

That remuneration shall be subject to the flat-rate deduction of 10%. However, leaders can choose to deduct their actual business expenses and justified.

For example, an executive receives a salary of €100,000, flat-rate allowances for the cost of €15,000. Its actual justified professional costs are €35,000. The amount to be reported will not be the same depending on whether or not he opts for the actual fee regime.

For business, executive pay is a deductible charge they correspond to actual work and are not excessive in relation to the duties performed.

Such remuneration may be subject to the payroll tax if the business is not or has not been subject to VAT on 90% at least its turnover.

In a limited partnership business, the remuneration of the following directors is subject to income tax:

• Non-associated Managers
• Members of the Supervisory Board provided that their remuneration corresponds to actual work

How much must be declared by officials?

Any remuneration received by business managers subject to business tax (IS) is subject to the progressive income tax (IR) schedule, in the salary and wages category. Such remuneration may be the basic salary, a bonus, a bonus, a benefit in kind, a profit sharing results, for example.

That remuneration shall be subject to the flat-rate deduction of 10%. However, leaders can choose to deduct their actual business expenses and justified.

For example, an executive receives a salary of €100,000, flat-rate allowances for the cost of €15,000. Its actual justified professional costs are €35,000. The amount to be reported will not be the same depending on whether or not he opts for the actual fee regime.

For business, executive pay is a deductible charge they correspond to actual work and are not excessive in relation to the duties performed.

Such remuneration may be subject to the payroll tax if the business is not or has not been subject to VAT on 90% at least its turnover.

These are businesses who by reason of their object or form are subject to business tax or who have opted for it.

The taxation of executive remuneration varies depending on the reason why the civil business is subject to business tax. The rules are as follows:

• If a business has taken the form of a capital business (SARL, SA or SCA), the rules concerning the management taxation regime are the same as those of the business it took the form of.
• If a business is subject to the SI because of its purpose, the remuneration of the managing partners is subject to income tax because they are agents. However, the functions of manager must not be a simple extension of industrial or commercial activity. Such remuneration shall not exceed the normal remuneration of the duties actually performed.
• If a business has opted for the SI, the remuneration of members whose profits are deductible is subject to income tax.

Any remuneration received by business managers subject to business tax (IS) is subject to the progressive income tax (IR) schedule, in the salary and wages category. Such remuneration may be the basic salary, a bonus, a bonus, a benefit in kind, a profit sharing results, for example.

That remuneration shall be subject to the flat-rate deduction of 10%. However, leaders can choose to deduct their actual business expenses and justified.

For example, an executive receives a salary of €100,000, flat-rate allowances for the cost of €15,000. Its actual justified professional costs are €35,000. The amount to be reported will not be the same depending on whether or not he opts for the actual fee regime.

For business, executive pay is a deductible charge they correspond to actual work and are not excessive in relation to the duties performed.

Such remuneration may be subject to the payroll tax if the business is not or has not been subject to VAT on 90% at least its turnover.