France 2027 Budget Bill: corporate tax and key measures for international companies

By Michel Bohdanowicz, French chartered accountant (expert-comptable). Published on 16 October 2026.

The French Government tabled its draft Finance Bill for 2027 (projet de loi de finances, bill no. 3210) on 1 October 2026. For groups with French subsidiaries, branches or employees, it would reduce the temporary corporate income tax surtax on large companies, extend some investment incentives and reshape the tax treatment of termination payments. None of these measures is law yet: as at 16 October 2026, the bill is still being debated in Parliament.

Where the bill stands on 16 October 2026

The bill was tabled on 1 October 2026. The Finance Committee of the National Assembly rejected the entire "revenue" part, so the plenary debate, which opened on 13 October, started again from the Government's original text. A formal vote on the first part is scheduled for 20 October 2026; the bill will then go to the Senate. The Government may also resort to Article 49.3 of the Constitution.

The Government's stated target is a public deficit of 5% of GDP in 2027, compared with 5.4% in 2026, which would require a fiscal effort of €54 billion. Everything described below should be read as proposals that could still change. Check the final text before acting.

Corporate income tax and existing regimes

• Surtax on large companies: the bill would reduce the exceptional corporate income tax surtax on large companies by 30%. The Government presents this as confirming that the surtax is temporary.
• Research tax credit (CIR): preserved.
• Dutreil regime (relief on the transfer of family businesses): preserved.
• Income tax brackets: indexed to inflation, which matters for expatriate employees and executives taxed in France.

Investment incentives

• Green industry tax credit (C3IV): Article 9 would extend it to electricity networks, solar thermal, electric vehicle batteries and permanent magnets.
• Temporary over-depreciation for SMEs and mid-sized companies (ETI): also under Article 9, for investments in robotics, 3D printing and generative AI.
• "Pacte Papin" (Article 10): measures to support the transfer of SMEs, including a higher allowance on capital gains for owners retiring and a reduced registration duty when a business is sold to its employees.

Payroll measures voted in plenary (provisional)

According to LégiFiscal (16 October 2026), the National Assembly adopted several amendments in plenary. They remain provisional until the vote of 20 October, the Senate reading and any use of Article 49.3:

• the income tax exemption ceiling on overtime pay would rise from €7,500 to €15,000 for pay received from 2027;
• the 2026 exemption ceilings for the employer fuel bonus would be extended to 2027: €1,000 for fuel and €600 for electric vehicle charging or the sustainable mobility allowance;
• for 2026 income, the mileage allowance scale could not be lower than the 2025 scale increased by 10%, excluding electric vehicles.

Termination payments: a single cap of one PASS

Article 2 of the Finance Bill and Article 6 of the Social Security Financing Bill (PLFSS 2027) would introduce a single exemption cap equal to one annual social security ceiling (PASS), i.e. €48,060 in 2026, for income tax, social contributions and CSG-CRDS. It would apply to dismissals, negotiated terminations (rupture conventionnelle) and compulsory retirement taking effect from 1 January 2027, including statutory or collective-agreement severance pay and payments under a redundancy plan (PSE). The existing thresholds of 10 PASS (5 PASS for corporate officers), above which payments are subject to social contributions from the first euro, would be maintained. The Government estimates that 95% of employees would remain fully exempt.

The debate is not closed: amendments adopted in plenary would take dismissals out of the one-PASS cap and apply the new regime to sums received from 1 January 2027. The PLFSS formal vote is scheduled for 27 October 2026. Groups planning departures of senior staff around year-end should model both scenarios.

Practical steps for international groups

• Update your 2027 French tax budget for the surtax reduction, but only once the final text is known.
• List planned investments in robotics, 3D printing, generative AI or green industry that could qualify.
• Review planned terminations of employees and corporate officers, and their timing, in light of the 1 January 2027 date.
• Track the final vote and the Senate reading before making any irreversible decision.

Furnished rentals: the risk of capped depreciation

Non-residents who own a furnished flat in France should also watch Article 7 of the bill. For non-professional furnished rentals (LMNP) taxed under the actual-expenses regime, deductible annual depreciation of the property would be capped at 2.5% of its cost (acquisition costs included, land excluded) and €7,000 per year per tax household, all furnished properties combined. For furnished tourist rentals, the cap would be 1.5% and €5,000. Depreciation not deducted for financial years ending from 2027 would be permanently lost. Nothing has been adopted as at 16 October 2026. Estimate the impact on your property now, but wait for the final text before deciding.

Official sources

• National Assembly, 2027 Finance Bill legislative file (bill no. 3210): assemblee-nationale.fr
• LégiFiscal, presentation of the bill (1 October 2026): legifiscal.fr
• LégiFiscal, amendments adopted in plenary (16 October 2026): legifiscal.fr
• LégiFiscal, termination payments (8 October 2026): legifiscal.fr
• LégiFiscal, LMNP depreciation cap: legifiscal.fr

A French accounting firm for international companies. Our Paris firm advises foreign-owned companies and non-resident owners on French accounting and tax obligations. To discuss the impact of the 2027 Budget on your French entity, please use our contact page or see our Paris 8th office page.