4 : Smoothing or spreading devices

1. The exceptional income of a farmer subject to a real taxation system may, by option, be attached, in equal fractions, to the results of the financial year in which it is realised and of the six following financial years.

The provisions of I of article 163-0 A shall apply in respect of each of these financial years regardless of the amount of the fraction referred to in the first paragraph.

2. For the application of 1, exceptional income means:

a. Either, where the operating conditions during the financial year in which the profit is made are comparable to those of the previous three financial years and the operator makes a profit in excess of €25,000 and in excess of one and a half times the average results of the previous three financial years, the fraction of this profit in excess of €25,000 or this average if it is higher. For the purposes of assessing the profits for the financial year in question and for the three previous financial years, deficits are taken into account for a zero amount and no account is taken of profits subject to a proportional rate or of losses carried forward;

b. Or the amount corresponding to the difference between the compensation provided for in article L. 221-2 of the Rural and Maritime Fishing Code and the value in stock or in the purchase account of the animals slaughtered;

c) (Periodised)

3. In the event of cessation of activity, the fraction of the income mentioned in 2 remaining to be taxed is included in the taxable profit for the financial year of this event.

The contribution of an individual farm, under the conditions mentioned in I of article 151 octies, to a company is not considered, for the application of the first paragraph, as a cessation of activity if the company benefiting from the transfer undertakes to continue to apply the provisions provided for in 1, under the same conditions and according to the same procedures, for the fraction of the income mentioned in 2 remaining to be taxed. The same applies to the free transfer of an individual business under the conditions provided for in Article 41 if the beneficiary or beneficiaries of the transfer make the same undertaking.

The merger, demerger or partial contribution of assets carried out by a company mentioned in the second paragraph of I of article 151 octies A, under the conditions provided for in the same I, is not considered, for the application of the first paragraph of this 3, as a cessation of activity if the absorbing or beneficiary company undertakes to continue to apply the provisions provided for in 1, under the same conditions and according to the same procedures, for the fraction of the income mentioned in 2 remaining to be taxed.

4. The option provided for in 1 must be made no later than the deadline for declaring the results of the first financial year to which it applies.