The business taxation is a major concern of the entrepreneur, given the diversity of existing taxes and the complexity of tax law.

The entrepreneurs’ corner offers practical guides on how business taxation works: 

VAT, taxation of profits (corporate tax / taxation in the name of partners), the territorial economic contribution (CFE and CVAE), taxes and contributions on wages (apprenticeship tax, contribution to vocational training, etc.), TVS, tax on wages, etc.

Company managers can receive compensation for their corporate office. If they own securities in the company, shares or shares, they can also receive dividends in their capacity as a partner / shareholder. But the tax regime of the structure also affects the taxation applicable to the income received.

Here is everything you need to know about the taxation of the income of directors, partners or not: remuneration or dividends.

• Tax income associated managers
• Taxation of remuneration paid to directors
• Corporate officers concerned

Are concerned by the developments which follow the directors of company’s subject of right or option to the corporation tax (IS), regardless of whether they have the quality of partner within the structure.

These concerns in particular the remuneration paid (non-exhaustive list):

• In managing majority, minority, equal or not associated with a CNS , a SARL or EURL,
• To the president and the possible managing director of an SAS or a SASU,
• And the chairman of the board of directors or the general manager of an SA.

Taxation applicable to remuneration

The amounts paid as compensation shall be indicated in the statements personal to income tax (PIT) interested. They come under the category of salaries and wages and may benefit, where applicable, from a standard allowance of 10%. Managers able to justify their actual costs can deduct them. Net remuneration (after deduction) is subject to the progressive scale of income tax.

In return for being taxed in the hands of managers, compensation and social charges constitute charges deductible from corporate results. Thus, they are deducted from taxable profits. Please note, however, that the sums paid as remuneration must be proportional to the services rendered and not be abusive with regard to the financial capacities of the company. Use the tax return calculator for the best results.

Taxation of dividends distributed to associate managers

Persons concerned

The following developments concern the managers who also hold securities in the company in which they exercise their corporate office. They therefore own shares or company shares and have the status of partner. It should also be noted that the company must be subject to corporation tax.

In practice, it may be the managers presented above:

• Associate manager of EURL / SARL,
• Chairman or Managing Director of SAS / SASU,
• Chairman of the Board of Directors or Managing Director of SA.

Taxation applicable to dividends

Dividends paid to shareholders and partners of a company can benefit, as of right, from the single flat-rate deduction of 30% (PFU or flat tax). They then bear social security contributions at the rate of 17.2% as well as income tax at the rate of 12.8%.