France Administrative Court of Appeal of Nantes Clarifies Deductibility of Doubtful Debts from Intra-Group Financing

The French Administrative Court of Appeal of Nantes Dec. 23 issued Decision No. 25NT00819, clarifying the tax treatment of provisions for doubtful debts from intragroup financing. The taxpayer claimed a deduction for provisions for doubtful debts owed by its parent company, but the tax authority assessed additional corporate income tax and related penalties after a tax audit revealed that the debt claims were not credible. On appeal, the Administrative Court of Appeal of Nantes held that: 1) the 180,000 euro (US$211,914) provision for doubtful debts was unjustified because the taxpayer failed to establish the existence of a genuine receivable or ...