France Administrative Supreme Court Issues Decision Clarifying VAT Exemption, Corporate Tax Rules on Contract Transfers

The French Administrative Supreme Court Dec. 3 issued Decision No. 465406, clarifying the VAT treatment and conditions for corporate tax exemption, on asset transfers and related commissions. The taxpayer, a French company acting as a commercial agent, sold a contract to another firm and was assessed additional corporate income tax and VAT following an audit. The Toulouse Administrative Court of Appeal partially granted VAT relief and rejected other claims. On appeal by both parties, the Administrative Supreme Court found that: 1) the transfer of a single commercial agent contract didn’t constitute the transfer of a complete branch of activity, and, ...