France Tax Agency Clarifies Amendments Under 2022 Finance Law for Innovation Tax Credits of SMEs

The French General Directorate of Public Finance Feb. 16 clarified amendments to the innovation tax credit (CII) rules for small and medium enterprises (SMEs) under the 2022 finance law. The clarification includes: 1) an extension to Dec. 31, 2024, of the CII for SMEs; 2) an increased common law CII rate to 30 percent from 20 percent, and an increased overseas rate to 60 percent from 40 percent, to compensate for the abolition of including the lump sum in the CII calculation for expenses incurred from Jan. 1, 2023; and 3) the exclusion of companies in financial difficulties and companies ...