The priority neighborhoods of the city policy (QPV) are located in urban territory. They are characterized by the following:

• Minimum number of 10,000 inhabitants
• Difference in income of the population compared to that of the national territory and the agglomeration in which the district is located.

In the DOM and the COMHowever, these neighborhoods are characterized by social, demographic, economic or habitat-related criteria, taking into account the specificities of each of these territories.

A tool allows to know precisely the streets that are in priority neighborhood of the city policy (QPV).

Find out if your address is located in a priority neighborhood of the city policy (QPV)

Companies located in these neighborhoods can benefit from exemptions from property tax on built properties (TFPB) and company property tax (CFE). There are 2 CFE exemption schemes:

• Establishment creations and extensions in QPVs
• Small companies with commercial activities in QPVs

Deliberation of municipalities

Municipalities and public inter-municipal cooperation institutions with their own tax system (EPCI) may exempt from CFEs establishment creations or extensions carried out since 1^er January 2015 until December 31, 2025 in the priority districts of the city policy (QPV).

Deliberation must be taken before the 1st^er October for an application the following year. It sets the rate of exemption, its duration and the district or districts concerned. This exemption may be abolished by a deliberation of the communes which must be taken before 1^er October of one year to be applicable the following year.

The establishment creation is a new location of a company in a municipality where there is no change of operator.

The extension of establishment corresponds to the increase in the means of production of an existing establishment.

The exemption shall not apply in the following cases:

• Change of operators
• Transfer within the same municipality or EPCI with its own taxation to a QPV

Conditions of the CFE exemption

To benefit from this exemption, all the following conditions must be met:

• The establishment created or which has been extended must use less than 150 employees.

• The establishment must depend on a small or medium company which meets all of the following criteria:
  
  • Less than 250 employees
  
  
  • Annual turnover HT: titleContent greater than €50 million or annual balance sheet greater than €43 million (only one of these criteria must be met)
  • Where the company is a business: Capital or voting rights not held directly or indirectly up to 25% or more by one or more companies that do not meet the staffing and financial conditions.

A company that benefits from an exemption from CFE may also apply for an exemption from the company Value Added Assessment (CVAE).

Duration and amount of the CFE exemption

The exemption of CFE is temporary.

It is total for 5 years. Then one abatement degressive applies in the following years:

• 60% the 6^e year
• 40% the 7^e year
• 20% the 8^e year

The amount of this exemption is limited according to the net taxable amount at the institution's CFE. It may not exceed the following amounts:

• 2022: €29,796
• 2023: €30,630
• 2024: €32,468
• 2025: €33,637

This amount is reassessed each year based on the change in consumer prices (excluding tobacco).

Application for exemption from CFE

To benefit from the CFE exemption for an establishment, you must send a form that depends on the situation: establishment or extension of establishment

Deliberation of municipalities

Municipalities and public inter-municipal cooperation institutions with their own taxation (EPCI) may exempt from CFE the creation or extension of an establishment dependent on a small company with a commercial activity in QPVs.

This exemption applies to the following establishments:

• Establishments existing to 1^er January 2015 or 1^er January 2017 (regardless of when they were created) in a QPV
• Establishments which, between 1^er January 2015 or 1^er January 2017 and December 31, 2025, are subject to a creating or a extension in a QPV:
  
  • The creation of an establishment is a new location of a company in a municipality as long as there is no change of operator.
  • The establishment extension corresponds to the increase in the means of production of an existing establishment. This increase must not be the result of a transfer of activity within the same municipality or EPCI with its own taxation to a QPV.

Conditions of the CFE exemption

To benefit from this exemption, all conditions the following must be combined:

• Activity of the company : the institution must be dependent on a company exercising a commercial activity. This excludes in particular industrial activities, management or rental of bare or furnished buildings, agricultural or fishing. Craft activities are treated as commercial activities when the companies are registered in both the National company Register (RNE) and the Trade and business Register (RCS).
• Staff of the company (are accounted for employees of all establishments of the company, whether or not located in a QPV):
  
  • Less than 11 employees if the establishment exists at 1^er January 2015 or was created in 2015 or 2016
  • Less than 50 employees if the establishment exists at 1^er January 2017 or has been created since 2017. For establishments created since 1^er January 2020, this condition is assessed at each financial year.
• Turnover of company :
  
  • Annual turnover or balance sheet less than €2 million if the establishment exists at 1^er January 2015 or was created in 2015 or 2016
  • Annual turnover or annual balance sheet less than €10 million if the establishment exists at 1^er January 2017 or has been created since 2017
• When the company is a business : capital or voting rights not held directly or indirectly for 25% or more by one or more companies not meeting the headcount and financial conditions: headcount of 250 or more employees and annual turnover HT: titleContent greater than €50 million or annual balance sheet greater than €43 million (only one of these criteria must be met).

CFE Exemption Period

The exemption of CFE is total for 5 years.

Then, a abatement degressive applies in the following years:

• 60% the 6^e year
• 40% the 7^e year
• 20% the 8^e year

The amount of this exemption is limited. The net taxable amount per institution may not exceed the following amounts:

• 2022: €80,375
• 2023: €82,626
• 2024: €87,584
• 2025: €90,737

This amount is reassessed each year based on the change in consumer prices (excluding tobacco).

Application for exemption from CFE

To benefit from the CFE exemption for an establishment, you must send a form that depends on the situation: establishment or extension of establishment

Companies who own a property in a QPV can benefit from a property tax exemption on built properties (TFPB). The purpose of this device is to promote the establishment and maintenance of local businesses in these neighborhoods.

Several CFE exemptions

Where the company fulfills the conditions to benefit from several CFE exemption schemesHowever, it must opt for only one of these schemes. This option is definitive.

It cannot cumulate several exemptions. 

For example, it is not possible to cumulate the 2 CFE exemption schemes for QPVs. Similarly, it is not possible to combine the exemption from CFE provided for in the QPVs with that provided for in the employment areas to be revitalized (BER) or defense restructuring zones (DRZs).

CFE and TFPB exemptions

On the other hand, it is possible to combine both an exemption from CFE and an exemption from property tax on built properties (TFPB).

However, the total amount of aid (including CFE and TFPB) must not exceed €300,000 over 3 fiscal years according to the application of the de minimis rule.

The period must therefore include the current fiscal year, as well as the 2 previous fiscal years. Compliance with this ceiling shall be assessed at the time of the granting of each new de minimis aid. For each new de minimis aid granted, account must be taken of the total amount of aid de minimis granted in the previous 3 years.

Beyond this amount, the aid must be notified to the European Commission.