Everything you need to know about tax returns: definition, composition, usefulness and new features!
What are tax returns, and what are they for? Are you required to prepare one? What does it consist of?
When you're an entrepreneur, it's only natural to ask yourself all these questions about tax returns and the responsibilities they entail.
Don't panic, this article covers all the essential points to help you master the concept of tax returns at your fingertips... in just a few minutes!
What is a tax return? Definition
The tax package is a set of documents drawn up by the company or its chartered accountant at the end of each accounting period, in order to declare to the tax authorities the income it has generated.
It includes the annual financial statements, such as the balance sheet and income statement, and is mandatory for (almost) all companies.
- 🤔 What about tax returns for micro-businesses? They are not required to do so.
- 🤔 And what about tax returns for associations? The majority of them are not required to keep accounts, although there are a few exceptions.
What is the purpose of the tax return?
It is used to communicate the company's financial situation, in a regulated manner, and must be sent to the tax authorities:
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to calculate the amount of tax due,
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and to check compliance with regulations.
👉 Its reliability also makes it a document much appreciated and consulted by investors, banks, suppliers and customers, to justify good financial health. It's a reassuring factor for current and future financial partners!
Composition of the tax return
The tax return is made up of a CERFA income declaration form, and 18 appendices listed below:
| 2050 | balance sheet assets |
| 2051 | balance sheet liabilities |
| 2052 | income statement |
| 2053 | income statement (continued) |
| 2054 | fixed assets |
| 2055 | depreciation |
| 2056 | balance sheet provisions |
| 2057 | maturity of receivables and payables at year-end |
| 2058 A | determination of taxable income |
| 2058 B | deficits, vacation pay and non-deductible non-deductible provisions |
| 2058 C | income appropriation table and miscellaneous information |
| 2059 A | determination of capital gains or losses |
| 2059 B | allocation of short-term capital gains, merger or contribution gains |
| 2059 C | monitoring long-term capital losses |
| 2059 D | long-term capital gains and provisions for price fluctuations |
| 2059 E | value added produced during the year |
| 2059 F | composition of share capital |
| 2059 G | subsidiaries and affiliates |
Tax returns: what's new in 2021
As a reminder, several new features have been added to the tax form in 2020, including :
- the elimination of tax credit for competitiveness and employment (CICE) forms,
- pre-filling of amounts subject to income tax, thanks to the integration of new headings,
- the tax reduction for sponsorship is now completed in a special appendix,
- self-employed workers must now report their social security information on the BIC/IS form (as the Déclaration sociale des indépendants will disappear in 2021).
As for 2021, the new features concern :
- the submission of tax returns for 2021, as detailed below,
- the 2021 tax form, to be submitted from April 1, 2021 (at 0:00 a.m.),
- legislative and regulatory changes,
- the pre-filling of the income tax return for individuals and associates of non-trading companies.
💡 The changes do not affect the calculation or composition of the tax return.
▶︎ When should the 2021 tax return be filed?
The deadline for filing tax returns in 2021 is May 4, 2021, and concerns :
- companies subject to corporate income tax (impôt sur les sociétés), whose financial year ends on December 31, 2020;
- companies subject to income tax (impôt sur le revenu).
☝️ Good to know: a 15-day grace period is granted within the framework of teleprocedures, i.e. until May 19, 2021 at the latest. For companies closing their accounts on another date, filing must take place on the last day of the 3rd month following the closing date.
How do I fill out my tax return?
To find out more about the procedure, read our full article on how to fill in your tax return.
To summarize, there are 2 ways of doing this:
- either on impots.gouv.fr via your member area,
- or by EDI (electronic data interchange) via a partner or your accounting software.
Article translated from French