Profits tax

Profits tax

The subject matter here concerns rental revenues generated, whether directly or via companies that are transparent for tax purposes, by professional investors subject to CT, not to rents collected by private persons that are subject to the regime governing income from land ( Individuals > Rental income ). 

The taxable rental income (taxable profit) is determined using a two-step approach:

1st Step: detemining the accounting profit:

  • Regarding rental income subject to CT, such income is determined according to the accounting principles set out in the General Accounting Chart;

  • One of the basic principles in particular is the use of accruals accounting (taking account of revenues and expenditures from when the corresponding receivable or debt arises, i.e. in general when the service is provided, the delivery made or the contract signed), rather than cash-based accounting (based on recording of payments, i.e. receipts and disbursements).

The accounting profit is the difference between the proceeds received and the charges incurred: most of these proceeds and charges are listed in the chart below:

PROCEEDS             -              CHARGES
Turnover (rents)   Costs 
Writeback of provisions  

Calculated charges (i.e. those not corresponding to an expense generating an immediate disbursement):

  • Depreciation
  • Provisions
Financial proceeds   Financial costs


2nd Step: Detemining the taxable profit:

  • Various tax rules are applied to the accounting profit to determine the taxable profit; these rules are primarily aimed at limiting the deductibility of certain expenses.




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