City Policy Priority Neighborhoods (QPV): Tax Relief

The priority districts of the city policy (QPV) are located in urban territory. They are characterized by the following:

• Minimum number of 10 000 inhabitants
• The income gap between the population and the national territory and the agglomeration in which the neighborhood is located.

In the DOM and COM, these districts shall be characterized by social, demographic, economic or habitat criteria, taking into account the specific characteristics of each of these areas.

A tool allows you to know precisely the streets that are in the priority neighborhood of the city's politics (QPV).

Know if your address is located in the priority area of city politics (QPV)

Companies located in these neighborhoods can benefit from exemptions from property tax on built-up property (TFPB) and company property tax (CFE). There are 2 CFC exemption schemes:

• Establishment creation and expansion in QPV
• Small companies engaged in commercial activities in QPVs

Deliberation of municipalities

Municipalities and public institutions for intercommunal cooperation with their own taxation system (EPCI) may exempt from the tax establishment or extension of establishments made since 1^er January 2015 in the priority districts of city politics (QPV).

Deliberation must be taken before 1^er October for an application the following year. It shall fix the rate of exemption, its duration and the quarter or quarters concerned. This exemption may be abolished by a decision of the municipalities which must be taken before 1^er October of one year to be applicable the following year.

The establishment is a new establishment of a company in a municipality if there is no change of operator.

The extension of the establishment corresponds to the increase in the means of production of an existing establishment.

The exemption does not apply in the following cases:

• Change of operators
• Transfer within the same municipality or EPCI with its own tax system to a QPV

Conditions for the exemption from CFE

To benefit from this exemption, all the following conditions must be met:

• The establishment created or extended shall use less than 150 employees.

• The establishment must depend on a small or medium company that meets all of the following criteria:
  
  • Less than 250 employees
  
  
  • Annual turnover HT: titleContent greater than €50 million or annual balance sheet exceeding €43 million (only one of these criteria must be met)
  • Where the company is a business: Capital or voting rights not held directly or indirectly up to 25% or more by one or more companies which do not meet the staffing and financial requirements.

A company which is exempt from the CFE may also apply for an exemption from the company value added tax (VAAC).

Duration and amount of the CFC exemption

The exemption from CFE is temporary.

It is total for 5 years. Then one abatement degressive shall apply in the following years:

• 60% 6^e year
• 40% 7^e year
• 20% 8^e year

The amount of this exemption is limited according to the institution's net tax base at the CFE. It may not exceed the following amounts:

• 2022: €29,796
• 2023: €30,630
• 2024: €32,468

This amount shall be reassessed each year on the basis of the change in consumer prices (excluding tobacco).

Application for exemption from CFE

To benefit from the CFE exemption for an establishment, a form must be sent depending on the situation: establishment or extension of establishment

Deliberation of municipalities

Municipalities and public establishments of intercommunal cooperation with their own tax system (EPCI) may exempt establishment creation or extension from the EPC dependent on a small company carrying on a commercial activity carried on in the PVQs.

This exemption applies to the following establishments:

• Establishments existing to 1^er January 2015 or 1^er January 2017 (regardless of their creation date) in a QPV
• Establishments that, between 1^er January 2015 or 1^er January 2017 and December 31, 2024, are subject to a creation or a extension in a QPV:
  
  • The creation of an establishment is a new establishment of a company in a municipality provided that there is no change of operator.
  • The extension of an establishment corresponds to the increase in the means of production of an existing establishment. This increase must not be the result of a transfer of activity within the same municipality or the same EPCI with its own tax system to a QPV.

Conditions for the exemption from CFE

To benefit from this exemption, all conditions the following must be present:

• Activity of the company : The institution must be dependent on a company exercising commercial activity. This excludes, in particular, industrial, management or rental activities of naked or furnished buildings, agricultural or fishing. Craft activities are treated as commercial activities when the companies are registered in both the National company Register (NCR) and the Trade and business Register (SCR).
• Number of staff in the company (are accounted for employees of all establishments of the company, whether or not located in a QPV):
  
  • Less than 11 employees if the establishment exists at 1^er January 2015 or was created in 2015 or 2016
  • Less than 50 employees if the establishment exists at 1^er January 2017 or has been created since 2017. For establishments created since 1^er January 2020, this condition shall be assessed each financial year.
• Company turnover :
  
  • Annual turnover or balance sheet below €2 million if the establishment exists on 1^er January 2015 or was created in 2015 or 2016
  • Annual turnover or annual balance sheet below €10 million if the establishment exists on 1^er January 2017 or has been created since 2017
• When the company is a BUSINESS : capital or voting rights not held directly or indirectly up to 25% or more by one or more companies which do not meet the staffing and financial requirements: staff of 250 or more employees and annual turnover HT: titleContent greater than €50 million or annual balance sheet exceeding €43 million (only one of these criteria must be met).

CFC Exemption Duration

The exemption from CFE is total for 5 years.

Then, a abatement degressive shall apply in the following years:

• 60% 6^e year
• 40% 7^e year
• 20% 8^e year

The amount of this exemption is limited. The net taxable amount per institution may not exceed the following amounts:Consumer price index trends: all households (excluding tobacco)

• 2022: €80,375
• 2023: €82,626
• 2024: €87,584

This amount shall be reassessed each year on the basis of the change in consumer prices (excluding tobacco).

Application for exemption from CFE

To benefit from the CFE exemption for an establishment, a form must be sent depending on the situation: establishment or extension of establishment

Companies who own real estate in a QPV can benefit from a property tax exemption on built property (TFPB). The aim of this scheme is to promote the establishment and maintenance of local businesses in these districts.

Several exemptions from CFE

Where the company qualifies for several CFE exemption schemesHowever, it must opt for only one of these schemes. This option is definitive.

It may not cumulate several exemptions. 

For example, it is not possible to cumulate the 2 CFE exemption schemes provided for QPV. Similarly, it is not possible to cumulate the exemption from CFE provided for in the QPVs and that provided for in employment pools to be revitalized (BER) or Defense Restructuring Areas (DRAs) or urban free zones-entrepreneur territory (ZFU-TE).

Exemptions from CFE and TFPB

On the other hand, it is possible to combine both an exemption from CFE and an exemption from property tax on built properties (TFPB).

However, the total amount of aid (including CFE and TFPB) must not exceed €200,000 out of 3 drills tax.