TLDR: A spontaneous corrective declaration, filed before any action by the tax authorities and in good faith, allows a 50% reduction in late payment interest, the exclusion of collection penalties (Articles 1730 and 1731 of the French Tax Code), and exemption from the obligation to report tax fraud. Good faith is presumed unless the administration provides evidence to the contrary.
Reduction in late payment interest
If a spontaneous corrective declaration is filed before any action by the tax authorities (formal notice, ESFP, audit notice, request for clarification, etc.), the late payment interest is reduced by 50%. This reduction applies if the regularization is carried out before the expiry of the tax authorities' recovery period and the taxpayer has acted in good faith. Payment of the taxes due must accompany the declaration or be made according to a schedule accepted by the public accountant.
Exclusion of collection penalties
The penalties provided for in Articles 1730 and 1731 of the French Tax Code do not apply to taxes benefiting from the 50% reduction in late payment interest. This measure aims to encourage spontaneous regularization and align the treatment of taxpayers with that of administrative reminders.
Exemption from the obligation to report tax fraud
Taxpayers who spontaneously file one or more corrective declarations to rectify their previous tax situation are not subject to the obligation to report tax fraud. This exclusion does not apply if the declaration is filed during an ongoing tax audit, after receiving an audit notice, or if the taxpayer is already subject to an administrative or judicial investigation procedure.
Presumption of good faith
Omissions or inaccuracies in a declaration are presumed to be unintentional. The tax authorities can only deny the benefit of the reduction in late payment interest if they prove that the errors are fraudulent or fall within the scope of offenses that exclude good faith.
Cumulative conditions
To benefit from these advantages, the regularization must be:
- spontaneous: filed before any action by the tax authorities;
- in good faith: the error must be unintentional;
- accompanied by payment of the corresponding taxes, or a payment plan accepted by the public accountant.
Limits and exceptions
The corrective declaration will not be considered spontaneous if it is filed after the tax authorities have sent an official act (e.g., request for information, audit notice). Similarly, the benefits are excluded if the error is fraudulent or if the taxpayer is already under administrative or judicial investigation.