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This chapter is not exhaustive and is limited to broadly outline the tax consequences of the main events occurring when doing business in France. It does not constitute a tax advice or a client - attorney relationship. Materials are not suitable for tax analysis. Visitors are invited to consult a tax lawyer before taking any decision.
 Dissolution is a discontinuance of business (Death of the business owner or a key manager, bankruptcy, liquidation of the company, shut down of the activity, retirement, etc.) From a tax stand point dissolution carries many tax consequences:
- Immediate taxation of all the profits not taxed yet;
- Losses carried forward are lost (corporate income tax) or immediately deductible from the income of the owner (Look through entities).
- Immediate taxation of capital gains on which taxation has been deferred.
- Immediate taxation of untaxed reserves.
- Payment of dissolution duties according to the applicable rate "Facts and figures".
- Immediate taxation of the shareholders on the liquidation bonus.
- VAT on receivables must be paid immediately even if the payment is made later.
- All VAT tax credit, if any, are immediately reimbursed by the tax collector.
As of January 1st, 2005 the transfer of the head/registered office to an other EU member country no longer trigger the consequences of a dissolution e.g. immediate payment of the capital gain tax on the hidden gains (Altexis considers that prior taxation because of such a transfer can be successfully challenged).
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