What is industrial Girardin?

The device was created following the Girardin Industrial Law. It is mainly marketed by the Girardin Industriel pioneer Inter Invest via its G3F offer. To date, more than 25,000 French taxpayers have benefited from it. The latter offers a reduction in income taxes (IR) in return for an investment in small and medium-sized enterprises in the agricultural, industrial or craft sector located in the DOM COMs (often wrongly called DOM TOM).

DOM COM companies suffer from the remoteness of a continent, which generates significant additional costs and makes them uncompetitive. Mayotte, Guadeloupe, Martinique, Martinique, Martinique, Martinique, Réunion, Réunion, Saint-Martin, New Caledonia or Saint-Barthélemy are in particular concerned.

The Girardin Industrial Law

The device was voted under the Girardin law and transcribed into article 199 undecies B of the General Tax Code. This law was passed in order to encourage the economic development of DOM COM territories as well as real estate investment among taxpayers.

It was originally supposed to run until 2007 but has been regularly extended. At the end of 2020, the Girardin Industrial Law was again extended until December 31, 2025, for all DOM COMs.

Understand how the Girardin Industriel (G3F) works

Industrial Girardin (or G3F) is a wasteful investment in a company. This company is a carrying structure in the form of a general partnership (SNC) and exists only for the operation. Note that SNC is the only form of umbrella company authorized to make an investment by Girardin Industriel called by right.

This company, in which the investor becomes a shareholder, will use the funds invested by several French taxpayers to buy industrial and agricultural equipment. This equipment will be rented to VSEs and SMEs located overseas for a period of 5 years. Once this period has passed, the company is put into liquidation and the equipment is sold to the tenants for a symbolic €1.

In return for this wasteful investment, investors benefit from a tax reduction of between 10% and 14% the following year. In order to know the exact amount of Girardin tax exemption you can claim, we advise you to use an industrial Girardin simulator. The operation of the Girardin device is particular since we speak of a “one-shot” operation. This means that the tax reduction is not spread over several years but only over the year following the investment.

Example: Girardin Industriel

To better understand how it works, let's take the example of an industrial Girardin for a person whose taxes amount to €5,000 for the year 2022. She decides to do a G3F in order to Exemnize tax. Here are the different steps of the operation:

2022: If the investor signs up for a G3F as soon as the Inter Invest subscription period opens, they benefit from 14% tax exemption (or 114% of the amount invested) in 2022.
The investor must therefore invest €4385 in order to erase all of his taxes. Calculation: 5000€/1.14 = 4385€
One-shot investment in a project compatible with the Girardin Industrial Law and total cancellation of the tax due for 2022. If the person's tax rate (TMI) is correct, they will have paid €5,000 in tax for 2022.
2022: the investor will therefore receive a refund from the General Directorate of Public Finances under the Girardin Industrial Law.
2026: the carrying company is dissolved and then liquidated, the operation officially comes to an end.

Understanding Girardin Industriel tax exemption

Girardin Industrial ceiling

The Girardin industrial ceiling is higher than that reserved for tax niches by article 200-0 A of the General Tax Code. The standard ceiling is €10,000 per household. However, for investments made overseas, this ceiling was increased to €18,000 under article 199 undecies B of the CGI, i.e. €8,000 more.

Declare an investment in Girardin Industriel

In order to benefit from the Girardin Industrial tax exemption, the amounts invested must be declared on the tax return the year following the investment. Here are the steps to follow:

Use the 2042 IOM declaration, dedicated to overseas investments.
Enter the amount of the tax reduction in the HFS or HFT box depending on the type of operation (with or without approvals)

Enter the total amount of the eligible investment in the “calculation sheet”

*The amount of the investment should be indicated on the dedicated spreadsheet*

Since the declaration is not trivial, the company behind the transaction (e.g. Inter Invest for G3F) will provide you with a Girardin Industriel tax return in order to help you fill in the necessary boxes.

Why industrial Girardin?

Before embarking on a Girardin Industriel 2024, it is important to understand the operation in detail. We review the pros and cons of this Girardin device.

The advantages of industrial Girardin

The main advantage of the mechanism of G3F is to offer a guaranteed return on investment to the taxpayer. In fact, if you subscribe to the device, you will receive up to 114% of the sum invested. So you can easily save up to 14% in taxes with one operation.

*Industrial Girardin is often used to finance construction equipment.*

All the legal complexity of the operation is managed by the leading company in Girardin Industriel Inter Invest. She takes care of making the necessary arrangements so that you can benefit from your tax reduction. If you are wondering how Inter Invest makes its margin, it's very simple: the complete tax reduction amounts to 44%. Inter Invest therefore takes 30 points of margin on the operation, which is high but all in all acceptable in view of the specificity of the arrangement.

The disadvantages of Girardin Industriel

A Girardin Industriel investment involves certain risks that deserve to be examined. Before you start, it may be interesting to discuss it with a wealth management advisor.

The first disadvantage is the need to invest a large amount in year N and only get a refund in year N+1. This requires financial flexibility.

The real risk of industrial Girardin lies in complying with the draconian conditions provided for by law. If some of these conditions are not met, the tax authorities may call into question your tax reduction. Risks are divided into 2 categories: financial risks and fiscal risks.

There are 3 fiscal risks:

Eligibility of the operator: Only companies with a NAF code compatible with the system can use G3F funding. Among the accepted sectors, there are in particular maritime fishing, tourism and recreational boating. These companies must also be up to date with their obligations to the tax authorities, in particular the payment of taxes.
Exploitation of financed assets: the financed goods must be operated for at least 5 years without interruption by the TPE or SME. If the tenant of the property goes bankrupt, tax exemption is called into question.
Retrocession of the tax benefit: the Girardin Industrial operation must respect the fiscal retrocession rate set at least at 56% of the total amount.

Financial risks stem from the fact that by subscribing to G3F, the investor becomes a shareholder in a company.

Debts: Thus, he becomes responsible for the debts of the company, and this in an infinite way. In fact, the risk concerns only half of the assets financed. In fact, the other half of Girardin Industriel's operation is financed by a bank. In concrete terms, if the tenant of the equipment does not pay his rent, the bank could require the investor to reimburse the rents not received.
Lack of insurance: If the lessee of the equipment has not renewed the insurance of a property financed by the carrying company, the investor would risk considerable damages in the event of accidents (in particular personal injuries).

In order to limit these risks, companies offering Girardin Industrielle such as Inter Invest offer a guarantee of good financial and fiscal purposes (or G3F). This includes the following insurances:

RC Pro insurance covering the investor against set-up errors up to €20M in tax reduction
100M€ “Umbrella” liability insurance covering investors against lack of insurance and damage caused by equipment.

G3F financial coverage of €10M for other fiscal and financial risks, the equivalent of a guarantee fund.
Legal Assistance in the event of a tax audit or adjustment. Inter Invest prepares your responses to the tax authorities and supports you for the 8 years following the subscription (i.e. 3 years longer than the actual duration of the transaction).

Our opinion on the Girardin Industriel (G3F): it is important to choose your operator carefully before investing. In addition, each Girardin bill must receive prior approval from the Ministry of Economy and Finance. Ask to see it before investing.

How to invest in the Girardin Industrial Law?

The guarantees offered by Inter Invest significantly reduce the risks of set-up and make Girardin industrial tax exemption very attractive.

FAQ Girardin Industriel

How does the Girardin Industriel device work? Industrial Girardin (or G3F) is a wasteful investment in small and medium-sized enterprises in the agricultural, industrial or artisanal sectors located in the DOM COMs (often wrongly called DOM TOM). It allows you to benefit from a tax reduction of up to 16%. To date, more than 25,000 French taxpayers have benefited from it.

How to invest in an Industrial Girardin? The programs are marketed by various companies. The pioneer of Girardin Industriel Inter Invest via its G3F offer, which has benefited thousands of French people.

How to declare Girardin Industriel? You should use the 2042 IOM declaration, which is specifically dedicated to overseas investments. Then, you must enter the amount of the tax reduction in the HFS or HFT box depending on the type of operation (with or without approvals). Good to know: the company behind the transaction (e.g. Inter Invest for G3F) will provide you with a Girardin Industriel tax return to help you complete your return.

Girardin Industrial Law: the right tax exemption plan in 2024?