Don’t wait until the last minute to obtain your FEC files before a tax audit!
Usually, the French administration imports the accounting entries of a company before conducting a tax audit.
However, accounting software on the French market generates files according to their own standards and so, in the event of a tax audit, inspectors have to waste time importing them into their government audit system.
As of 1st January 2014, the French administration decided that each company must be able to provide its computerised accounting entries according to a mandatory government standard called “FEC”, an abbreviation of Fichier des Ecritures Comptables in French.
- Does this requirement apply to you?
This requirement applies to you if you meet the following 3 criteria:
- You have received an audit notice from the tax authorities;
- Your accounting entries are kept in a computerised accounting software;
- Your company is subject to corporate income tax (or personal income tax if your company is registered as an SNC).
You are exempt from this obligation if you are:
- An auto-entrepreneur;
- A real-estate company, known as a société civile immobilière (SCI) in France, whose partners are individuals;
- If you use a manual accounting system.
- What penalties could you incur?
When the auditor asks you for the FEC file upon arrival on site at the beginning of the audit, you then only have 15 days to produce it!
Failing this, the auditor will be able to assess your taxable income on a flat-rate basis, without going through adversarial procedures. There is no need for you to run such a high risk: we therefore advise you to obtain your company’s FEC files as soon as possible.
In addition, if you do not provide the tax auditor with the FEC file, you will have to pay a fine (5 000 €), or 10% of the reassessments if they are higher than 5 000€.
If you have any questions regarding the accounting entries file, please do not hesitate to contact us via telephone +33 (0) 1 53 93 94 20 or [email protected]. Our team of experts will happily assist you with any queries you might have.