An employee seconded abroad by his French employer to canvass the commercial aircraft rental market believes that he is entitled to the income tax exemption provided for in such a situation. The tax authorities disagreed, but what did the judge think?
Employee sent abroad: who benefits from canvassing?
A private individual signed an employment contract with a company based in France, which was itself owned by an American company, with a view to canvassing the commercial aircraft rental market abroad.
In his view, this entitled him to exemption from income tax on the salaries earned in the course of this activity… But not according to the tax authorities, who refused to allow him to benefit from this advantage.
“Why?” wonders the employee, who points out that employees sent abroad by an employer established in France to carry out commercial prospecting for more than 120 days a year can benefit from an exemption from income tax on salaries received as remuneration for this activity.
The employee maintains that all the conditions required to benefit from this scheme have been met. For proof :
- the employer is domiciled in France;
- his salaried activity consists of prospecting a commercial market abroad;
- the assignment abroad lasted more than 120 days over a period of 12 consecutive months.
However, the authorities pointed out that an essential condition was missing: although the employee had indeed been sent abroad to prospect, the sole purpose of this activity was to develop the commercial aircraft leasing business of the American company… and not that of the French company.
This was confirmed by the judge: the exemption from income tax only applies if the employee’s activity is aimed at developing the foreign activities or markets of a French employer.
The tax exemption claimed here is therefore refused!