Tax Changes in 2025 for French SMEs

In 2025, the tax landscape for French SMEs will undergo significant changes. With maintained attractive rates, threshold adjustments, legislative updates, and new support measures, it is crucial for business leaders to stay informed and prepare accordingly. Here is a clear summary of the key measures impacting small and medium-sized enterprises this year.

Corporate Income Tax: Rates, Reductions, and SME Thresholds

In 2025, the standard corporate income tax rate remains at 25% for all profits. Additionally, some SMEs continue to benefit from a reduced rate of 15% on the first €42,500 of profits if:

• The turnover is below €10 million
• The capital is fully paid-up
• At least 75% of the capital is held by individuals or eligible companies

Beyond this threshold, the 25% rate applies.

VAT and Basic Exemption Thresholds: What’s Changing in 2025

The VAT exemption thresholds are confirmed for 2025:

• €85,000 for trade and accommodation activities
• €37,500 for services and furnished rentals
• Increased thresholds: €93,500 (trade/accommodation), €41,250 (services/furnished)

The planned reform to unify the threshold at €25,000 has been suspended until the end of 2025, maintaining the current system. The tolerance period for threshold exceedance is now 1 year, down from 2 years previously.

From 2025, the exemption will also extend to other European countries under certain conditions (Article 293 B ter of the CGI).

Local Taxes: CVAE, CFE, and Changes

The total abolition of the CVAE (Value Added Economic Contribution) has been postponed to 2027. SMEs are therefore still liable in 2025. The CET (Territorial Economic Contribution) cap remains at 2% of added value. Some sectoral exemptions have also been extended. Note: fiscal simplifications for local taxes are under consultation and may evolve during the year.

Innovation, Investment, and Hiring Support Measures

• Research and Innovation Tax Credit: Eligibility conditions have been broadened with easier access for smaller companies, although rates may decrease depending on the project.
• IR-PME Reduction: Rate increased to 25% for share subscriptions under certain conditions.
• Hiring Tax Credits: Temporary reinforcement of tax credits for youth and long-term unemployed hiring in 2025 to support employment.

Software Compliance and Enhanced Controls

• Mandatory Certification of Cash Register Software: All companies involved in VAT management must use software certified compliant with anti-fraud legislation.
• Intensified Digital Tax Audits: Automated controls will increase, with strengthened penalties for breaches.
• Anti-Abuse Measures: New targeting of aggressive tax avoidance schemes heightens risks for reassessments.

Conclusion

The 2025 tax changes bring new opportunities but require vigilance and anticipation. Certifying IT tools, reviewing practices, and seeking a tax audit with Deunite can optimize benefits and avoid pitfalls.

FAQ