SAP Case: Assessing the Interest of a Cash Pool Participant in a Cash Pooling Agreement

A cash pool participant, structurally in a creditor position, indirectly transfers profits abroad to the cash pool leader entity by placing its cash surpluses at a 0% interest rate, in place of the initial remuneration that would have resulted in a negative rate due to the lack of equivalent consideration.
The reinstatement of the granted benefit may validly be based on the average remuneration rate for sight deposits published by the Banque de France.
This approach reveals both a broad interpretation of the presumption of indirect profit transfer, a restrictive analysis of the consideration relied upon by the taxpayer, and a renewed framework for quantifying the tax adjustment.
Read the article of Théophile Trancart, published in the Revue de droit fiscal on June 6, 2024.