Skills-based corporate philanthropy: valuation, cap and tax relief in France (2026)

Skills-based corporate philanthropy is one of the few French tax incentives available to any business — from a sole trader to a multinational — without a minimum headcount requirement and without any cash outlay. Law no. 2024-344 of 15 April 2024 removed the practical restriction that had limited the scheme to companies with 5,000 employees or more under French labour law, extended the maximum secondment period to three years, and codified the valuation cap at three times the monthly social-security ceiling (PMSS) per employee.

For the directors and CFOs of international companies operating in France, the mechanism is straightforward on paper but requires careful documentation to withstand a tax audit. Two questions come up repeatedly: how to value the secondment correctly, and how the tax reduction cap works in practice.

The short answer: skills-based philanthropy triggers the Article 238 bis tax reduction — 60% of the amount given (40% above €2 M) — within an annual cap of €20,000 or 0.5% of turnover excluding VAT (whichever is higher), with carry-forward over five years. The secondment is valued at cost — employee remuneration plus employer social charges, pro rata to time spent — capped at three times the PMSS per employee per month (approximately €12,015/month in 2026, with a PMSS of €4,005).

Skills-based philanthropy is a gift in kind: the company makes its employees' working time and expertise available free of charge to an eligible public-interest body. The employees remain on the company's payroll throughout; the beneficiary organisation pays nothing.

Two neighbouring concepts must not be confused with it.

Financial philanthropy is a cash donation to an eligible body. The tax regime is identical (Article 238 bis), but there is no valuation issue — the amount donated is the base.

Sponsorship is an invoiced advertising service: the company receives commercial visibility or other benefits in return for its support. Sponsorship costs are deductible as business expenses and subject to VAT, but they do not qualify for the philanthropy tax reduction. The line between philanthropy and sponsorship is the most frequently contested point in tax audits: any significant advertising benefit for the company — logo placement, dedicated media coverage, exclusive event invitations — tips the arrangement into sponsorship territory.

For a broader view of French corporate giving, see our article on corporate donations to associations in France.

The base for the tax reduction is the cost of the secondment, defined as the employee's gross remuneration plus all related employer social charges, calculated pro rata to the time actually devoted to the beneficiary organisation.

Cost includes: gross salary (base, bonuses, benefits in kind), employer pension and social-security contributions, employer contributions to training, transport, and other statutory levies.

However, Law 2024-344 introduced an explicit valuation cap: for each seconded employee, the cost taken into account cannot exceed three times the monthly social-security ceiling (PMSS) per month. With the 2026 PMSS at €4,005, the cap is €12,015 per month per employee (approximately €144,180 per year).

For a senior executive whose total monthly employer cost is €20,000, only €12,015 per month enters the calculation base. The remainder is still deductible as a payroll expense but generates no additional tax reduction.

For an employee whose total monthly cost is €8,000, the full amount counts (below €12,015). For a director costing €18,000 per month, only €12,015 enters the base.

The tax reduction follows the general corporate philanthropy scale under Article 238 bis of the French tax code.

The reduction is direct: it reduces the actual tax bill, not the taxable income. This makes it significantly more valuable than a simple deduction — for a company at the standard 25% IS rate, a €10,000 deduction saves €2,500, while a 60% reduction on the same amount saves €6,000.

One exception applies: gifts to organisations providing free meals, accommodation or medical care to people in hardship (the "Coluche law" regime) retain the 60% rate with no ceiling on amounts. This rarely affects skills-based secondments but may apply to partnerships with certain charities.

The annual cap is the higher of €20,000 and 0.5% of turnover excluding VAT.

• Company with turnover of €2 M: cap = max(€20,000; €10,000) = €20,000 (floor applies).
• Company with turnover of €6 M: cap = max(€20,000; €30,000) = €30,000.
• Company with turnover of €60 M: cap = max(€20,000; €300,000) = €300,000.

Where the reduction exceeds the annual cap, the excess carries forward for up to five financial years. A company whose secondment generates a large reduction can therefore spread the benefit over time — and should plan its philanthropic commitments accordingly.

A French management-consulting firm (turnover: €4.5 M excl. VAT, IS at 25%) seconds two senior consultants at half-time to an accredited professional reintegration association for six months.

Valuation calculation:

• Consultant A: total monthly employer cost = €7,200. Time devoted: 50%. Monthly valuation: €3,600. Over 6 months: €21,600 (below cap of 6 × €12,015 = €72,090).
• Consultant B: total monthly employer cost = €15,000. Time devoted: 50%. Theoretical monthly valuation: €7,500. Since €7,500 < €12,015, the full €7,500 counts. Over 6 months: €45,000.

Total valuation: €21,600 + €45,000 = €66,600.

Tax reduction calculation:

• Rate: 60% (total well below €2 M).
• Gross reduction: €66,600 × 60% = €39,960.
• Annual cap: max(€20,000; €4,500,000 × 0.5%) = max(€20,000; €22,500) = €22,500.
• Reduction applied in Year 1: €22,500.
• Carry-forward to subsequent years: €39,960 − €22,500 = €17,460.

For a firm paying €100,000 in corporate tax, the €22,500 reduction represents a 22.5% saving — with no additional cash outlay beyond salaries already being paid.

Four cumulative requirements must be satisfied to secure the tax reduction.

Eligible beneficiary organisation. Article 238 bis lists the qualifying categories: public-interest bodies with disinterested management, publicly recognised foundations, corporate foundations, publicly recognised associations, national museums, higher education and arts institutions, and State-approved organisations. If there is doubt about an organisation's eligibility, it can be asked to provide a DGFiP tax ruling (rescrit fiscal) confirming its status.

No significant benefit for the company. The secondment must be genuinely free of charge, with no commercial return. Modest acknowledgement of the company's support (a brief mention on the association's website, for example) is generally tolerated; material advertising visibility is not.

Tax receipt from the organisation. The beneficiary must issue a compliant tax receipt (standard Cerfa form or equivalent), confirming the nature and value of the gift, the date, and the organisation's eligibility. This document is required to claim the reduction.

Filing the 2069-RCI return. If total gifts (cash plus in-kind) exceed €10,000 in the financial year, the company must attach form 2069-RCI to its tax package. This form summarises all tax reductions and credits not reported on the main income statement.

Before Law no. 2024-344 of 15 April 2024, the labour-law framework effectively limited skills-based secondments to companies with 5,000 or more employees. Since 16 April 2024:

• The scheme is open to all companies, regardless of size.
• The maximum secondment period per employee has been extended from two to three years (renewable).
• The valuation cap has been explicitly set at three times the PMSS per month per employee, resolving previous interpretive uncertainty.

These changes make skills-based philanthropy genuinely accessible to SMEs and mid-caps, which can now commit their teams to multi-year missions without the legal risk that previously attached to extended secondments. Skills-based secondments can also form a pillar of a broader RSE roadmap for SMEs.

A Paris-based consulting firm (35 employees, turnover €5.2 M) asked us to structure a year-long partnership with an accredited social-inclusion association. One HR manager was to be seconded two days per week to help the charity build its recruitment processes.

The HR manager's total monthly employer cost was €9,800. Time devoted: 40% (2 out of 5 days). Monthly valuation: €9,800 × 40% = €3,920 (below the €12,015 cap). Annual valuation: €3,920 × 12 = €47,040.

Tax reduction: €47,040 × 60% = €28,224. Annual cap: max(€20,000; €5,200,000 × 0.5%) = max(€20,000; €26,000) = €26,000. Reduction in Year 1: €26,000. Carry-forward: €2,224.

The initial stumbling block was not the calculation but the evidence trail: the company had no formalised time-tracking for the seconded employee. We introduced a joint monthly timesheet signed by the employee, the company, and the association. Without this record, the reduction would have been difficult to defend in an audit. A preliminary DGFiP ruling confirming the association's eligibility provided an additional layer of protection.

The DGFiP scrutinises skills-based philanthropy operations, particularly because the boundary with sponsorship is sometimes blurred and because secondment valuations can be hard to verify.

Characterisation of the arrangement. Inspectors look for concealed commercial benefits: disguised service agreements, undisclosed advertising exposure, privileged access to networks or events.

Time records. The DGFiP may request timesheets, payslips, job descriptions, and the philanthropy agreement to verify that the valuation matches actual prorated cost. An estimated lump sum without supporting time records is vulnerable.

Organisation eligibility. An organisation that no longer meets public-interest criteria — due to undisclosed commercial activities or non-disinterested management — may lose its status retroactively. A preliminary tax ruling protects the donor company.

Cap compliance. Auditors verify that the 3 × PMSS cap per employee per month has been applied and that form 2069-RCI has been filed when required.

Our view. Skills-based philanthropy is a powerful and under-used tool for French SMEs, which often assume it is reserved for large corporations. Since the 2024 law, that barrier no longer exists. But the tax benefit is only secure when backed by rigorous documentation: a philanthropy agreement, monthly signed timesheets, a compliant tax receipt, and — for any significant operation — a preliminary DGFiP ruling confirming the beneficiary's status. The calculation is simple; the evidence file is what protects you in a control.

1. Separate philanthropy from sponsorship clearly in the written agreement — state explicitly that no commercial benefit is received.
2. Apply the valuation cap: check that the cost per employee does not exceed 3 × PMSS (€12,015/month in 2026). Recalculate employee by employee for senior staff.
3. Maintain monthly timesheets co-signed by the employee, the company, and the beneficiary organisation.
4. Collect the tax receipt from the organisation before the year-end close.
5. File form 2069-RCI if total gifts (cash + in-kind) exceed €10,000 in the year.
6. Request a preliminary tax ruling (rescrit fiscal) from the DGFiP if there is any doubt about the organisation's eligibility.

If your company is also subject to French payroll tax (taxe sur les salaires), note that the cost of a secondment may affect the taxable payroll base — a point worth reviewing with your accountant.

• Skills-based philanthropy triggers the Article 238 bis tax reduction: 60% of payments up to €2 M (40% above).
• Annual cap: €20,000 or 0.5% of turnover excl. VAT, whichever is higher, with a 5-year carry-forward.
• Valuation at cost (remuneration + employer charges, pro rata), capped at 3 × PMSS per employee (≈ €12,015/month in 2026).
• Law no. 2024-344 of 15 April 2024 opened the scheme to companies of all sizes and extended secondments to up to three years.
• Secure the benefit with a philanthropy agreement, monthly timesheets, a compliant tax receipt, and the 2069-RCI filing.

Updated 2026-06-14. This article is for information purposes and does not replace personalised professional advice. For your specific situation, consult a chartered accountant registered with the Ordre des Experts-Comptables.