New: The decree of 2 February 2017 details the tax and employment obligation information content that online platforms must give their users regarding any income received when using such platforms.
The obligation to inform concerns online « collaboration » platforms aimed at putting individuals and/or professionals in touch with each other, for the purpose of providing a service or selling, exchanging or sharing goods or a service in return for financial payment. For instance, this refers to car pool sites that put car drivers in touch with their clients, sites that put owners of properties in touch with people looking for accommodation or even sites for contacting professionals to design a logo or undertake a marketing study.
The obligation of collaboration platforms to inform is intended to make it easier for users to understand and put into practice the tax and employment procedures they must fulfil when issuing receipts via these platforms. There are three areas where information must be provided:
- The platform website must give links to the websites of tax authorities and social security institutions describing the procedures to be followed;
- For every transaction, the platform must inform users about any tax and employment obligations relating to the transaction made on the platform, as well as the applicable penalties should they fail to observe these obligations; this requirement is considered to have been met when messages sent by the platform contain links to the websites mentioned above;
- Once a year, by 31 January at the latest, the platform must send all users a summary specifically showing the number of transactions made and the total amount of money received by the user through the platform during the previous year. In 2017 the summary must include transactions made between 1 July and 31 December 2016 and be sent to users by 31 March 2017 at the latest.Since 1 March 2017 it is now compulsory to display the links both on the platform and in messages sent to users.
Moreover, the platform must obtain certification from an external auditor, an auditing firm or an independent third party complying with certain conditions, testifying it has observed its obligations to inform throughout the previous year. The certificate must be sent to the appropriate tax authority by email before 15 March. In 2017, the deadline has been extended to 15 May 2017. Any failure by the platform to obtain this certification will result in a fine of €10,000.
Decree n° 2017-126 of 2 February 2017; BOI-BIC-DECLA-30-70-40 (Bulletin Officiel des Impôts – Benefices Industriels et Commerciaux [French Official Tax Gazette – Industrial and Commercial Benefits]) Declaration
Our recommendations: In practice, to comply with the new obligations, a collaborative platform must implement the following measures as soon as possible:
- update the site’s General Terms and Conditions of Sale or Use by including a section with the links to the necessary tax authority and social security sites. Particular care should be taken over drafting the provisions informing users about their obligations, given that the platform is not necessarily aware of its users’ circumstances.
- arrange automatic issue of the notice to be sent to users for every transaction, as well as the annual summary;
- contact an external auditor to obtain the required certification.