Post by hasina789956 on Oct 29, 2024 4:23:26 GMT -5
Corporate sponsorship is a tax system that allows companies to make donations to organizations of general interest. In France, sponsorship is also a strategic opportunity for companies. Giving to win… How is it possible? We explain it to you in summary here, as a guest of the MMIO blog, and in detail in our Guide to Corporate Sponsorship on SOESS . But before we begin, let's say it right away, integrating sponsorship into the company's strategy is just the icing on the cake. Indeed, you still need to have a business strategy that allows you to generate profits... Give to earn more, then. This is possible by combining all the benefits that a company can get from patronage by integrating it into its overall strategy. To do this, you have to put into the equation all the ingredients that make up the life of the company: taxation, human resources management, a touch of logistics and a good dose of anthropology (in other words reputational and relational issues). The generous taxation of corporate sponsorship in France “Generous taxation”... Is this provocation? A little, but in terms of patronage, it is not us who say it, it is the Court of Auditors in its report Public support for corporate patronage. The tax regime for corporate sponsorship in France is one of the most generous in the world. Let’s see why.
Corporate tax reduction for patronage When I give 100 and it only costs me 40, I earn a little, right? Article 238 bis of the General Tax Code allows companies to benefit from a tax reduction of 60% of the amount of their donations, up to 0.5% of their turnover. For example, a company with a turnover of 10 million euros can donate 50,000 euros and get a tax reduction of 30,000 euros. It then only costs 20,000. To make patronage accessible to small and medium-sized enterprises, a tax deductible of 20,000 euros has been introduced. Thus, regardless of bulk email campaigns its turnover, an SME can donate up to 20,000 euros and benefit from a tax reduction of 60% of the amount of the donation. For donations exceeding 2 million euros (if you are in this case, call me) the tax reduction is 40% instead of 60%. However, for donations to organizations helping people in difficulty ( Coluche law ), the rate of 60% is maintained. Companies can spread the tax reduction over five accounting years.
This allows you to make a large donation in one go while benefiting from the tax advantage over several years, or to limit the risks if you are not sure of making your turnover. 1.2. Types of donations eligible for corporate sponsorship When you give something that costs money, you gain a little, right? Companies can make cash donations, of course, but also through the foregone income (rather than paying you, your client donates the money to an organization of your choice on your behalf). Donations of movable and immovable property, services, and the provision of staff are also eligible, and this is where things get interesting. In-kind sponsorship refers to the donation of real estate, personal property, or services. The valuation of these donations is an issue for calculating the tax reduction. Fixed assets are in fact valued at their sale value, while personal property and services are valued at their cost price. So don't forget to add the transport costs and the cost of storing unsold items (yes, those that have been lying around for years at the back of the warehouse) when you give the valuation to the organization that benefits from your donation, so that it can issue its “patronage tax receipt”. This type of sponsorship involves making employees available during their paid working hours and free of charge.
Corporate tax reduction for patronage When I give 100 and it only costs me 40, I earn a little, right? Article 238 bis of the General Tax Code allows companies to benefit from a tax reduction of 60% of the amount of their donations, up to 0.5% of their turnover. For example, a company with a turnover of 10 million euros can donate 50,000 euros and get a tax reduction of 30,000 euros. It then only costs 20,000. To make patronage accessible to small and medium-sized enterprises, a tax deductible of 20,000 euros has been introduced. Thus, regardless of bulk email campaigns its turnover, an SME can donate up to 20,000 euros and benefit from a tax reduction of 60% of the amount of the donation. For donations exceeding 2 million euros (if you are in this case, call me) the tax reduction is 40% instead of 60%. However, for donations to organizations helping people in difficulty ( Coluche law ), the rate of 60% is maintained. Companies can spread the tax reduction over five accounting years.
This allows you to make a large donation in one go while benefiting from the tax advantage over several years, or to limit the risks if you are not sure of making your turnover. 1.2. Types of donations eligible for corporate sponsorship When you give something that costs money, you gain a little, right? Companies can make cash donations, of course, but also through the foregone income (rather than paying you, your client donates the money to an organization of your choice on your behalf). Donations of movable and immovable property, services, and the provision of staff are also eligible, and this is where things get interesting. In-kind sponsorship refers to the donation of real estate, personal property, or services. The valuation of these donations is an issue for calculating the tax reduction. Fixed assets are in fact valued at their sale value, while personal property and services are valued at their cost price. So don't forget to add the transport costs and the cost of storing unsold items (yes, those that have been lying around for years at the back of the warehouse) when you give the valuation to the organization that benefits from your donation, so that it can issue its “patronage tax receipt”. This type of sponsorship involves making employees available during their paid working hours and free of charge.