Tax credit for investment in green industry (C3IV)

What does the notion of “green industry” mean in practice? 

Green industry” covers two major families of activities: 

• The creation of green industries: Establish and expand new industries that provide goods and services that enable the decarbonisation of our economy. 
• Decarbonising existing industry: Enable all existing industries, regardless of their sector, size or location, to green their operations and support them in this process”. 

What kind of expenditures will be covered by C3IV? 

The C3IV is awarded to companies based in France that are involved in : 

Tangible fixed assets: tangible investments (buildings, installations, equipment, machinery, land) needed to operate the eligible teams. 

Intellectual property rights: intangible investments (patents, licences, know-how or other intellectual property rights) in one of the four technologies mentioned above.  

• Specifically, expenditure eligible under C3IV is that required for : 
• The production of battery cells and modules, wind power, solar panels and heat pumps, 
• The production of essential components designed and used primarily for the production of this equipment, 
• The production or recovery of the critical raw materials needed to produce the equipment and components defined above. 

What kind of activities are involved ?

• Equipment production 
• Production of essential components for this equipment 
• Working with raw materials essential to equipment or components 

Detailed lists of eligible equipment and components available on the government website 

If you are in type 2 or 3, you need to prove that at least 50% of your sales are made with companies further down the manufacturing cycle. 

What are the other conditions? 

Companies must meet a number of conditions to qualify for C3IV: 

• Not having just moved to France from an EU country to invest in green energy. 
• Not to relocate the investments made within 2 years of obtaining the C3IV certificate. 
• Operate the investments covered by the scheme for at least 5 years (3 years for SMEs).

What are the C3IV rates and limits ?

This tax credit is directly deductible from the tax due for the year or financial year in which the “eligible” expenditure is incurred. Otherwise, it is refunded for the part exceeding the tax payable. 

Its “standard” rate is 20%. 

However, it can be increased to between 25% and 40%, depending on the status of the beneficiary company (VSE/SME/non-VSE) and whether it is located in a regional aid area (ZAFR), in the outermost regions or in an investment aid area (ZAI). 

Some limits will also be introduced: 

• An “ordinary law” limit of €150 million per company, which can be increased to between €200 million and €350 million for investments by SMEs in ZAFRs and investment aid zones, in accordance with the European aid framework.

In practice, how do you apply for approval?

The accreditation service is open from 27 September 2023, allowing companies to anticipate and submit their accreditation applications at c3iv@dgfip.finances.gouv.fr. 

Applications are examined by the Direction Générale des Entreprises (DGE) in collaboration with the Direction Générale des Finances Publiques (DGFIP) and the Agence De l’Environnement et de la Maîtrise de l’Energie (ADEME). 

3 additional files must be included in the application 

• General presentation of company and requirements, 
• Then a full presentation of the investment project and its viability. 
• And lastly, the environmental benefits and obligations

The approach to be implemented

Beforehand

• Decide to invest 
• C3IV aptitude tests on DGFiPs special C3IV portal: 

Q&A and C3IV calculation simulator created and updated 

Grant

• Application for approval: c3iv@dgfip.finances.gouv.fr 
• Demand study: DGFiP, DGE and ADEME 
• Response within 3 months: Approval granted and guarantee of the amount you will receive 

Claim and payment 

• A tax return indicating the amount of money invested in the CAPEX during the year. 
• For the year in which the investment plan expenditure is incurred, the amount of IC is deducted from corporation tax.