Companies not liable to pay corporation tax
Some companies are deemed to be translucent for tax purposes, i.e. they are not themselves liable for taxation.
It is their shareholders who have to pay tax on their share of the profits made by such companies. This is the case with the SCI and SNC in particular.
ð The shareholders present at the end of the company’s financial year are taxed on their share of the company’s profits for this year, usually according to their own tax regime (depending mainly on whether the shareholder is a legal entity that pays corporation tax or an individual who pays income tax) and according to the nature of the company’s activities.
The share of profits on which shareholders in such a company are taxed is not linked to the dividend that will actually be distributed to them. Thus there is a disconnect between the taxation of income and the legal assessment of this income.
SCI and SNC companies may opt to pay corporation tax (see hyperlink SCCV: Development > Profits tax > Focus - SCCV) .