Tax - ORWL

ORWL_ assists its clients with all tax matters related to crypto-assets, leveraging deep legal expertise combined with an exceptional technical understanding of on-chain flows and decentralized protocols.

Led by Alexandre Lourimi, our tax practice is characterized by a comprehensive approach to taxation, further enhanced by an extensive technical knowledge of the crypto-asset ecosystem and its underlying economics.

This dual proficiency enables us to address diverse issues—including corporate income tax, VAT, personal income tax, international tax, and wealth tax—with utmost rigor and precision. It further provides us with specialized expertise in representing clients during tax audits and litigation involving digital assets.

Beyond client-led mandates, our team is actively committed to the advancement and dissemination of tax knowledge applied to crypto-assets. The firm contributes to the development of legal doctrine through the authorship of reference works (Droit des crypto-actifs, LexisNexis; Encyclopédie de fiscalité internationale, Doctrine) and the regular publication of analyses in both specialized and academic journals. Our practitioners share their expertise within academic and professional circles, training students and professionals alike, including lawyers, notaries, members of the judiciary, and wealth management advisors. Involved in the collective efforts shaping current regulations, the team participates in working groups, notably within ADAN. Finally, the firm dedicates its skills to leading NGOs, providing pro bono counsel on the structuring of crypto-asset donation campaigns.

Services

We advise all stakeholders within the technology and finance sectors—including start-ups and innovative ventures (Fintech, DeFi, protocols, and infrastructure), investment funds, crypto-asset service providers (CASPs), and high-net-worth individuals—on the full spectrum of their tax issues, specifically intervening in the following areas:

Tax Structuring: We ensure the tax compliance, optimization, and de-risking of innovative operations and business models regarding corporate income tax and VAT. This includes token issuances, token grants, and complex flow structures (decentralized organizations or applications, crypto-asset payments, staking, or mining activities).
VAT and crypto-asset services: Through tax opinions or tax rulings, we secure the VAT treatment of financial activities involving crypto-assets. Our expertise covers the boundaries of various exemptions that may impact input tax recovery (right to deduct), trigger payroll tax liability, or involve intermediation activities potentially leading to significant vicarious tax liability for intermediaries.
Tax residency: We assist individual investors with the acquisition or transfer of their tax domicile outside of France (analysis of domestic and treaty-based criteria, exit tax procedures, and taxation of French-source income). We also advise corporations on their establishment in France or abroad, specifically addressing permanent establishment (PE) risks.
Tax optimization: We analyze the tax regime applicable to various crypto-asset operations (exchanges, staking, lending, airdrops, collateralized loans, etc.) and provide strategic recommendations to manage and optimize the tax impact of these flows.
Audit and regularization: We conduct audits of crypto-asset transactions against filed tax returns and assist both corporate and individual clients in voluntary disclosures and the regularization of their tax affairs before the authorities.
Tax litigation: We represent and defend our clients throughout tax audit procedures (desk audits, formal on-site accounting audits, personal tax audits, and tax raids or searches), during the pre-litigation phase, and before both administrative and judicial courts.

Expertises

Tax residency and crypto-assets

Defense during a crypto tax audit

Crypto tax regularization

Securing the VAT model of a crypto project

Achievements

Our dual expertise—combining a comprehensive tax practice with specialized sector knowledge—is demonstrated through the following key engagements for both corporate projects and individual investors:

Tax structuring of a token issuance (corporate tax, VAT, and payroll taxes)

We have advised numerous centralized ventures and decentralized protocols on the implementation of token issuances. Our intervention specifically enabled our clients to:

Define a structured framework for Corporate Income Tax (CIT): We established a clear methodology for the revenue recognition of sale proceeds, aligning the tax treatment with the project’s delivery milestones and accounting standards.
Secure the VAT treatment of the transaction: We provided legal certainty regarding indirect tax liabilities, a position subsequently formally confirmed through a tax ruling (rescrit) from the tax authorities.
Implement a comprehensive token allocation plan: We designed incentive schemes for the project’s various stakeholders, ensuring they remained consistent with the desired performance incentives while strictly managing the tax and social security exposure for both the issuer and the beneficiaries.

VAT Audit of a marketplace

We advised an electronically supplied services (ESS) marketplace that had integrated crypto-asset payment flows, as part of its VAT risk management strategy. After conducting a comprehensive audit of the flows and various service offerings, we provided strategic recommendations to:

Position its intermediation within a consistent framework: We aligned the marketplace’s status with the nature of the services provided, thereby mitigating the risk of undisclosed agency (opacité fiscale) and ensuring a clear distinction between the platform and the underlying suppliers.
Determine and document the VAT base: We established a robust methodology for calculating the taxable amount (assiette) for both inflows and outflows denominated in crypto-assets, ensuring proper documentation for compliance purposes.

Wealth structuring of crypto-asset investments

We advised a crypto-industry entrepreneur on the estate planning and structuring of both their professional activities (remuneration model, holding company) and their personal investments (incorporation of income derived from specific tokens). Working in coordination with notaries and wealth management advisors, we implemented strategies to optimize the tax efficiency of their income and future succession.

Voluntary disclosure of crypto asset disposals and foreign accounts

We have assisted numerous early-stage crypto-asset investors in bringing their investments into regulatory compliance. After auditing all transactions and reconstructing a consolidated, documented history, we identified tax non-compliance issues, prepared amended tax returns, and substantiated the source of funds for crypto-assets held in undisclosed foreign accounts. We subsequently managed all correspondence with the tax authorities until the issuance of the notice of assessment for the omitted taxes and successfully negotiated the applicable penalties.

Tax raid related to permanent establishment (PE)

A foreign crypto-industry player was subject to search and seizure operations (opérations de visite et de saisie) at the residences of several executives and the headquarters of a subsidiary, as part of an investigation into the existence of an undeclared permanent establishment in France. We handled the defense by challenging the lawfulness of the search operations and the authorizing judicial order. Our objective was to gain access to the seized documents in order to prepare for the ensuing tax audit and to limit the scope of the investigations.

Team

Our team comprises experienced tax attorneys with a sophisticated technical understanding of the crypto-asset industry. We also collaborate with an extensive network of partners to provide our clients with seamless and comprehensive support, including chartered accountants, statutory auditors, notaries, banking institutions, and foreign counsel.

Partner

Alexandre Lourimi

Lise Jeanne dit Fouque

Sophia Robaia-Cottier