When the failure to publish a decision in the Commercial Register leads to a tax reassessment
A holding company was subject to a tax audit, following whichadministration issued a notice of assessment regarding payroll tax.
administration that its CEO's compensation should have been subject to this tax.
The company challenged the tax assessment all the way to the Administrative Court of Appeals, where it argued that it engaged in two distinct business activities:
a financial function involving the acquisition and management of the subsidiary's equity investments;
a commercial agreement covering the services provided by the subsidiary.
It considered that its CEO’s activities were limited to the second category and should therefore not be included in the payroll tax base.
The Administrative Court of Appeal noted, however, that the company’s articles of incorporation provided for the possibility for the chairman to appoint a managing director, specifying in the appointment document the scope of the latter’s powers. The articles of incorporation provided that this appointment document must be published in accordance with the law.
The judges then noted that the executive director had been appointed by a decision dated January 1, 2007, published in the Commercial Register, which stated that she had the same broad powers as the president.
They will also find that the new decision of September 30, 2009, on which the company relied—and which excluded the financial sector from the scope of its CEO’s responsibilities—does not allow for the rebuttal of the presumption established by the previous decision.
The Court notes, in particular, that this decision was not published in the Commercial Register and cannot be regarded as having a definite date.
She therefore confirms the tax reassessment.
CAA Toulouse, Sept. 18, 2025, No. 24TL00420
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