French General Tax Code
In forceA company which carries out an overall revaluation of its tangible and financial fixed assets under the conditions set out in article L. 123-18 of the French Commercial Code may not take into account the revaluation difference which it establishes when determining the taxable income for the financial year in which it carries out this revaluation.
The application of the first paragraph of this article is subject to the undertaking by the company:
1° To calculate the capital gain or capital loss subsequently realised on the disposal of non-depreciable fixed assets on the basis of their non-revalued value;
2° Reintegrate the revaluation difference relating to depreciable fixed assets into its taxable profits. The reintegration of the revaluation difference is carried out in equal parts over a period of fifteen years for buildings and for plantations and fixtures and fittings of depreciable land over a period at least equal to this period, and in equal parts over a period of five years for other fixed assets.
The sale of a depreciable fixed asset results in immediate taxation of the portion of the revaluation surplus relating to this asset that has not yet been reintegrated at the date of sale.
A company that has carried out a revaluation of a fixed asset is subject to immediate taxation.
A company which has carried out an overall revaluation under the conditions set out in the first paragraph calculates the subsequent depreciation, provisions and capital gains on disposal relating to depreciable fixed assets on the basis of the value assigned to them at the time of the revaluation.
The company that applies the provisions of the same first paragraph attaches to the income tax return for the year of revaluation and subsequent years a statement in accordance with the model provided by the administration showing the information required to calculate the depreciation, provisions or capital gains or losses relating to the fixed assets that have been revalued.
