What is the ‘Contribution à la Formation Professionnelle’ tax in France and how do you evaluate it?

31 May 2022

What_is_the_Contribution_à_la_Formation_Professionnelle_tax_in_France_and_how_do_you_evaluate_it

What is theContribution à la Formation Professionnelle? Who pays the ‘Contribution à la Formation Professionnelle’ (CFP)? How does it affect self-employed workers and employers in France? How is this tax calculated? How to pay the ‘Contribution Unique à la Formation Professionnelle’? There are many questions related to the ‘Contribution à la Formation Professionnelle’. Learn more about this French tax, which offers access to a professional training fund for employees and jobseekers, in this new guide.

What is the “Contribution à la Formation Professionnelle” (CFP)?

The “Contribution à la Formation Professionnelle” is a tax paid by French companies. It is used to fund professional training for their personnel and jobseekers. In France, companies pay an annual contribution to enable continuing education actions. The amount paid by employers for this vocational training tax depends on the number of employees in the company. This contribution has been mandatory since the creation of the Loi Avenir Professionnel (French law on the freedom to choose one's professional future).

Who pays the “Contribution à la Formation Professionnelle”?

Most employers have to pay the “Contribution à la Formation Professionnelle”, in accordance with Article L6131-1 of the French Labour Code (Code du Travail). All employers are required to contribute to the development of professional training and learning. You must pay this charge if you:

  • Run a for-profit association.
  • Own a private-sector company.
  • Run a state-owned company of a commercial and industrial nature (“Establishment Public à caractère Industriel ou Commercial”, or “EPIC”, in French).

This contribution enables your employees and colleagues, as well as jobseekers, to take one or more vocational training courses. Employers must also pay their contributions to funding the CPF (“Compte Personnel de Formation”, or personal training account), the “Taxe d’apprentissage” (apprenticeship tax), and the CSA (“Contribution Supplémentaire d’Apprentissage”, or additional apprenticeship contribution).

How is the CFP calculated?

The tax contributing to the funding of vocational training is calculated on the basis of the gross wage bill. The gross wage bill is the total annual amount of taxable remunerations and all fringe benefits paid to employees. This includes employee's contributions, salaries, bonuses, allowances and tips.

What is the rate for the vocational training contribution?

The applicable vocational training contribution rates are as follows:

  • 0.55% of the gross wage bill for employers with less than 11 employees;
  • 1% of the gross wage bill for employers with 11 employees and more;
  • 2% of the gross wage bill for those working as an ‘intermittent du spectacle’ (a special status in France for people employed in the performing arts).

It should be noted that certain professional sectors must pay higher rates than those mentioned above.

What are the rules for the collection of the CFP?

The CFP used to be governed by the French law No.2018-771 on the freedom to choose one's professional future, of 6 September 2018. It was reformed on 1 January 2022. Since the training reform, the tax for contribution to professional training has been collected by the URSSAF network, in order to simplify the declaration process. Employers must pay their contribution via the ‘Déclaration Sociale Nominative’ (DSN) system.

Previously monthly, the declarations for the contribution are now made yearly. The payment must be made each month, in the same way as Social Security contributions. Things are slightly different in the agricultural sector. Contributions are collected by the Mutualité Sociale Agricole (MSA) instead of URSSAF. Since 1 January 2022, the MSA and URSSAF are the collectors of the ‘Contributions de Formation Professionnelle et Taxe d'Apprentissage (CFPTA, or professional training contributions and apprenticeship tax).

What is the money collected used for?

The funds collected are paid to the CDC (Caisse des Dépôts et Consignations, a French public financial institution). This institution then pays the employers’ contributions to establishments that meet the criteria defined by Article L6241-5 of the French Labour Code. All of these organisations work to develop competencies through training, including both continuing vocational education and short vocational courses. They include the OPCA and OPCO (Organismes Paritaires Collecteurs Agréés’, or accredited fund-collecting agencies, and ‘OPérateurs de COmpétences’, or government-approved bodies providing support for professional training), public higher education establishments, establishments managed by a consular chamber, primary and secondary-level public education establishments, as well as ‘écoles de la deuxième chance’ (second chance schools). All of the recipients of the following schemes benefit from the funds distributed by the collecting organisations:

  • Compte Personnel de Formation” (CPF, or personal training account);
  • “Financement de l’apprentissage” (apprenticeship funding);
  • Funding for other work-study schemes;
  • Projets de Transition Professionnelle” (PTP, which enables employees to take time off work to take training with a view to changing profession);
  • Conseil en évolution professionnelle des actifs occupés”(which provides career planning advice for people in active employment);
  • Aide au financement du permis de conduire des apprentis” (financial assistance for apprentices to obtain a driver’s licence);
  • Plan de développement de compétences des entreprises de moins de 50 salariés” (skills development plan for companies with less than 50 employees).

Now you know the ins and outs of the CFP. Explore all the guides and continuing vocational education courses offered by IPAG Business School. Unsure which course to choose? Don’t hesitate to get in touch with our advisers to receive personalised assistance based on your situation and career plan.