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6.3. Depreciation and Amortization

Only two methods of calculating depreciation on business assets are permitted in France, the straight-line and the declining balance method, reserved to certain categories of goods or components.

Special accelerated depreciation may be authorized in certain circumstances such as fixed installations used for scientific and technological research and for water or air purification.

Four of the many specialized bonus depreciation schemes are:

  • Energy conservation equipment: may be written off over 12 months on a straight-line basis;
  • Anti-pollution constructions may be written off over 12 months on a straight-line basis;
  • Development subsidies: the depreciation base for assets financed by government subsidies is increased by ½ of the subsidy amount; and
  • Cinema and video production, and innovating companies: 50% of the cost of an investment in the stock of a film or video production company, or in the shares of an innovating investment company can be written off in the year in which the investment is made.

Additional depreciation allowance is available for investments in qualifying industrial, manufacturing and scientific research equipment. The allowance, introduced in 2015, is an additional 40% added to the depreciable base for assets acquired between 15 April 2015 and 31 December 2017.

Effective 1 January 2022, a temporary deduction is allowed for accounting depreciation on goodwill recorded in the account of companies under commercial funds if acquired between 1 January 2022 and 31 December 2025.