Computation Of The Taxable Income

Penalties for late payment of trade receivables

The Tax Authorities have just given their decision concerning the tax regime applicable to penalties for late payment and has adopted a strict position based on the legal rules to which they are submitted. The French Tax Authorities indeed considered that insofar as Article 3 of the law no. 92-1442 dated December 31, 1992 linked to the payment time-limits between companies, modifying the ruling no. 86-1243 dated December 1st, 1986, makes it compulsory to indicate in the agreement the computation modalities and the conditions of application of the penalties for late payment, then the non-respect by the client of these payment time-limits provided in the agreement leads to a receivable for the benefit of the seller or the supplier of the service.