Your tax notice will soon arrive in your mailbox, it’s the right time to go around the tax reduction devices. One of the most effective but relatively unknown is called the Girardin law. This device, in its industrial aspect, is very attractive. Find out why:
The Industrial Girardin Law (article 199 undecies B of the General Tax Code), is a tax incentive aimed at helping the economic development of the Overseas Departments and Collectivities by financing equipment for the benefit of local businesses. Investor taxpayers become partners in a Partnership (SNC), which becomes the owner of new industrial equipment, to benefit from a tax advantage equivalent to 44% of the sums invested in the equipment. The tax reduction is effective from the year following the investment (principle of so-called “one-shot” tax exemption), unlike other tax exemption schemes, such as the Pinel law ( recently extended until end of 2017 ) which finances new rental real estate investments for which the tax advantage is “recovered” over 6 years and more. Within the framework of an industrial Girardin assembly, the SNC rents industrial equipment under very advantageous conditions (total cost of equipment 25% below market value) to local entrepreneurs who become owners at the end of the 5 years of rental. The taxpayer will have invested in 2016 the equivalent of 70% of the income tax that he would normally have to pay in 2017, and will benefit from a return of 10 to 15% over less than a year! He will pay almost no tax in 2017 while contributing to the economic development of overseas France.
Operations under industrial Girardin law, referred to as “automatically”, finance equipment, the amount of which is limited to €250,000. These operations require perfect mastery of the process given the cumbersome nature of managing a large number of files, but have the advantage of offering the investor strong risk pooling.
Operations under industrial Girardin law known as “with approval” finance equipment whose cost exceeds €250,000. They therefore require a greater investment on the part of the taxpayer and are therefore accessible to taxpayers with high incomes and even companies subject to corporation tax.
For operations whose investments relate to projects whose amount exceeds €250,000 (Girardin Industriel with approval), approval from the local General Tax Department will be required. Operations financing industrial projects with a budget of more than €1.5 million require the approval of the national tax administration (Bercy). In this type of operation, the tenants are generally of excellent reputation, but the validation of their file is subject to specific constraints, such as the creation of jobs, which constitutes an additional risk of requalification of the tax advantage. of the taxpayer investor.
In conclusion, the administration’s agreement for a Girardin Industriel operation with approval does not ultimately have any specific advantage over a Girardin Industriel operation as of right. But the taxpayer will have to be very careful about the choice of promoter in the context of a Girardin investment as of right. In fact, this profession is unfortunately not regulated and serious players who have a storefront rub shoulders with unscrupulous opportunists…