Glossary
Tax scale for business valuation
In the business world, the question of business goodwilland more rigorously its value, is an essential element to define with precision the budget which will be associated with it before considering any transaction.
To understand this value, the method known as scale method is one of the most commonly used valuation methods.
Â
What is the scale method of business valuation?
Consisting in applying a multiplying coefficient to the sales turnover of a business, the scale method has the advantage of giving a quick idea of the value of the business. The formula applied for the calculation is generally applied in the following way:
Average sales including VAT for the last 3 years X coefficient
With a coefficient that can vary according to the sector of activity, note that this method of scales does not take into account certain elements of the company that could however prove to be essential to the valuation of a business.
Â
Which tax scale for the valuation of a business ?
Please note that the following tax schedule is not official character. It is therefore only an unofficial scale circulating between professionals but which is in no way confirmed by the tax authorities. It must therefore be interpreted with caution.
Moreover, the results obtained will often have to be corrected to take into account the criteria specific to the business (evolution or importance of the turnover, competitive arrival, rent, commercial lease, operating rights, location, price of equipment and premises, etc.).
Â
Tax scale for the valuation of food businesses
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
General food Butchery Bakery - Pastry - Viennese pastry Wine cellar Delicatessen Chocolate - Confectionery Creamery Dietetics-Natural products Delicatessen Self-service spice Cheese shop Fruit and vegetables Pastry shop Fish shop Frozen food Convenience store Supermarket | 60/145% 25/60% 50/120% 20/60% 40/90% 80/110% 60/230% 20/50% 100/400% 50/150% 25/60% 15/70% 50/110% 30/50% 15/35% 10/30% 10/40% |
Tax assessment scale for automotive trade and repair
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Car accessories Garage Repair shop Garage service station Electricity Garage VN sales Garage VO sales Service station | 15/35% 35/50 % 35/50% 30/60% 10/35% 5/30% 15/50% |
Tax valuation scale for restaurant and hotel businesses
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Discotheque Restaurant Fast food Creperie Pizzeria Tearoom | 180/310% 60/190 % 40/110% 60/110 % 45/120% 55/165 % |
Tax valuation scale for retail businesses
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Furnishing - Household equipment Pet shop - Aquarium - Bird shop Antiques Medical devices - Orthopedics Armourer Office supplies Bazaar Costume Jewelry Jewelry - Watches Hosiery - Lingerie - Haberdashery Brocante Gifts - Tableware - Articles de Paris Cardboard - Gadgets Shoes (retail) Cycles - Motorcycles (sale and repair) Leather - Furs Records (sale of) Household appliances - Hifi - TV - Video - Radio Earthenware - Porcelain - Glassware Traditional flowers Self-service flowers Art gallery Herbalism Musical instruments (sale) Games - Toys Bookstore - Stationery Lingerie Hosiery Lighting Marble - Funeral articles Leather goods - Travel goods Furniture (sale of) Haberdashery - Lingerie - Hosiery Optics Stationery Perfumery - Beauty products Pharmacy Photo Press Ready-to-wear clothing Ready-to-wear luxury Hardware - Do-it-yourself - Drugstore Repair of household appliances Reprography - Drawing of plans Locksmithing - Minute stub Sale of goods Tobacco - Tableware Fabrics Furnishing fabrics Video store Wine to go | 30/50 % 50/90 % 45/100 % 15/40 % 35/55% 30/60 % 15/50 % 40/120 % 30/70 % 40/80 % 40/70 % 30/70 % 40/90 % 40/90 % 15/40 % 25/50 % 15/60 % 10/60 % 45/75 % 45/90 % 30/60 % 50/200 % 30/90 % 5/40 % 20/60 % 30/130 % 40/80 % 10/40 % 35/120 % 60/200 % 20/80 % 20/100 % 50/120 % 45/100 % 45/95 % 70/110 % 40/115 % 25/60 % 35/90 % 60/170 % 20/60 % 20/60 % 15/60 % 40/100 % 25/45 % 80/160 % 10/110 % 20/80 % 30/100 % 100/400 % |
Tax valuation scale for leisure businesses
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Travel agency | 25/100 % |
Â
Tax scale for the valuation of goodwill in business services
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Cleaning - Guarding | 25/90 % |
Â
Tax scale for valuing health-related goodwill
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Ambulances | 55/85 % |
Â
Tax scale for the valuation of business assets related to personal services
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Marriage agency Retail Laundry Hairdressing Beauty salon Car rental Dry cleaning - Laundromat Laundromat Retirement home Animal care - Dog grooming | 40/60 % 40/70% 50/120% 50/80 % 30/60% 70/130 % 80/130 % 90/110 % 50/90 % |
Â
Tax scale for the valuation of SME goodwill
Activity labels | Percentage to be applied on annual turnover including VAT |
|---|---|
Industrial laundry Fireplaces (sale and installation) Kitchens (sale and installation) Cabinet making - Carpentry General Electricity Printing Gardening - Landscaping Masonry - Roofing Plumbing - Heating - Sanitary Protection - Security - Alarm Locksmithing - Electricity Road transport of goods & removals | 40/80 % 15/30 % 15/40% 15/60 % 10/30 % 5/40 % 10/60 % 10/25 % 10/40 % 25/75 % 20/50 % 50/90 % |
Â
Although the scale method is the most commonly used for the valuation of a business, other types of indicators can be taken into account for certain sectors of activity:Â
Activity labels | Indicator |
|---|---|
Coffee Bar - liquor license Hotel Tourism Hotel furnished Café - Tobacco shop / Net tobacco shop Insurance (Brokerage) Wine bar Real Estate Agency Property manager and syndic Cinema Self-service grocery store Delicatessen Theater | 300 to 1000 X daily revenue including VAT From 6.000 to 50.000 euros depending on the transfer possibilities 200 to 800 X daily revenue including VAT 250 to 900 x daily revenue including VAT 2 to 4 years of net tobacco discount 0.7 to 1.8 annual commissions 100 to 300 X daily revenue including VAT 0.5 to 1.5 annual net profit 50 to 220 % fees incl. tax/year 40 to 100 X taxable revenue/week 50 to 150 X daily revenue including tax 100 to 400 X daily revenue including tax 900 to 2 000 € the chair |
Â
As you will have noticed, to evaluate a business requires valuation and negotiation skills as well as the consideration of a number of criteria.
Thus, when it comes to transfer of a businessit is strongly recommended to call upon specialists.
As the objectives of the seller of the business and the buyer may be diametrically opposed, demonstrating impartiality can sometimes prove complex.
By entrusting the management of of your business to the experts XVALexperts, you will benefit from a professional and legal expertise that will prove essential for both parties and you will ensure an optimal transaction.
EVALUATION OF YOUR COMPANY
WITHIN 3 DAYS - 499€. HT *
Personalized study within 3 days
Several evaluation methods
Confidential and personalized
Xval Valuation
Order a company evaluation (secure payment by STRIPE)
MAKE AN APPOINTMENT WITH A CONSULTANT?
Get a detailed evaluation within 3 days: confidential / fast / personalized
THEY TRUSTED US
"A quick contact"
"Accurate and detailed"
"A great help."
