French General Tax Code
In forceI. - When the purchase price paid by the lessee for the property leased under a finance lease entered into with a société immobilière pour le commerce et l'industrie is less than the difference between the value of the property when the agreement was signed and the total amount of depreciation that the lessee would have been able to apply if it had owned the property since that date, the lessee acquiring the property is required to add back to his company's income for the financial year in progress at the time of the transfer, the fraction of the rental payments made during the period in which the lessee was the owner of the contract and corresponding to the said difference, less the transfer price of the property. The amount thus determined is reduced by the proportion of rent that is not deductible under the provisions of 10 of Article 39.
However, where the term of the leasing contract is at least fifteen years, this reintegration is limited to the difference between the cost price of the land on which the building was constructed and the price at which the building was sold to the lessee.
This provision does not apply to leases where the term of the contract is at least fifteen years.
This provision does not apply to transactions entered into on or after 1 January 1991 other than those referred to in the second paragraph of 3° quater of Article 208.
II. - Commercial and industrial property companies are required to provide the tenant purchaser and the administration, at the end of the lease, with the information necessary to establish the taxes provided for in I.
