VII: Sole trader and limited liability entrepreneur

1. For the application of this code and its appendices, with the exception of 2 of article 206, 5° of 1 of article 635 and article 638 A, the sole trader referred to in articles L. 526-22 et seq. of the commercial code who does not benefit from the schemes defined in articles 50-0,64 bis and 102 ter of this code may opt to be treated as a single-member limited liability company or a limited liability agricultural holding of which this trader acts as sole shareholder. When the option is exercised, article 151 sexies applies to the assets used to carry on the business. The liquidation of the sole proprietorship then has the same tax consequences as the cessation of the business and the cancellation of the corporate rights of a sole proprietorship with limited liability or a farm with limited liability.

2. For the application of this code and its annexes, with the exception of 2 of Article 206, 5° of 1 of Article 635 and Article 638 A, a sole trader who carries on his business as part of a sole proprietorship with limited liability not benefiting from the schemes defined in Articles 50-0,64 bisand 102 ter may opt to be treated in the same way as a single-member company with limited liability or an agricultural holding with limited liability whose person mentioned in the article L. 526-6 of the French Commercial Code takes the place of the sole shareholder. When the option is exercised, article 151 sexies applies to the assets required to carry out his professional activity. The liquidation of the sole proprietorship with limited liability then has the same tax consequences as the cessation of the business and the cancellation of the corporate rights of a sole proprietorship with limited liability or a farm with limited liability.

3. The options mentioned in 1 and 2, exercised under conditions set by decree, are irrevocable and constitute an option for corporation tax.

The company may, however, waive the option for corporation tax under the conditions mentioned in the third paragraph of 1 of Article 239. Subject to the provisions of Article 221 bis, the revocation of this option entails the tax consequences provided for in the second paragraph of 2 of Article 221.