Behind the apparent simplicity, there are many little scams and management methods that you need to master to run your business with peace of mind.
Micro-enterprise is a special status created in 2009 for people with a commercial, craft or liberal profession as their main or additional activity. This status allows you to benefit from a simplified micro-social security system, numerous tax advantages and major facilities for setting up, managing and winding up your business.
However, auto-entrepreneurs are often approached by numerous private companies and organizations at the start of their business.
Which are actually traps and scams to be avoided!
If you've mastered all the administrative aspects of your business project and would like to start your own self-employed business, you can register your auto-entrepreneur activity independently and free of charge on the URSSAF website https://www.lautoentrepreneur.fr/.
If you're looking for personalized support, some specialized platforms like Portail Auto-Entrepreneur can help you create your auto-entrepreneur status, declare your sales, provide you with a quotation and invoicing tool, and so on.
However, there are also fraudulent sites, and we strongly advise you to find out exactly what the terms of payment and membership are by consulting their General Terms and Conditions of Sale.
You should also beware of certain paid professional directories, which can also be traps designed to charge you for referencing a poorly documented and poorly referenced site.
A self-employed entrepreneur has recurring expenses that need to be anticipated when launching his business. They are under no obligation to keep accounts, but must record all expenses in a dedicated book. This also enables him to anticipate his budget for the coming year, and to know the cost structure of his business.
Social security contributions and taxes are calculated directly on sales, without any deductions.
The rate at which social security contributions are taxed depends on the activity carried out:
- 12.8% for commercial activities ;
- 22% for service activities ;
- 22% for self-employed activities.
To anticipate the income tax charge, it is necessary to apply a percentage to sales of :
- 1% for commercial activities ;
- 1.7% for service activities ;
- 2.2% for self-employed workers.
Above all, limiting expenses is absolutely essential in view of the limited sales.
The turnover to benefit from the advantages conferred by the simplified micro-social regime is limited by law. The reforms sought by President Emmanuel Macron have doubled the amount of the authorized ceiling as of January1, 2018 to encourage the growth of this status.
The current ceilings are as follows:
- Maximum sales of 170,000 euros excluding VAT for a commercial or accommodation activity (excluding furnished rentals);
- 70,000 euros maximum sales excluding VAT for a service activity (including furnished rental);
- 70,000 euros maximum sales (excluding VAT) for a craft business.
This increase also came into effect retroactively for 2017
If you exceed this limit, your auto-entrepreneur activity will be requalified as a traditional business, and you will lose all the advantages offered by this status.
Unlike salaried employees, auto-entrepreneurs are responsible for their professional actions. Certain professions, such as construction, are obliged to take out insurance.
You can opt for professional liability insurance, which covers material, immaterial or bodily damage caused to third parties (customers, suppliers, partners) as a result of errors, faults or negligence caused by the auto entrepreneur or his staff. Competition on the market has led to a reduction in prices.
Self-employed contractors who own their own premises can also take out ten-year insurance to cover themselves in the event of damage.
It is possible for auto-entrepreneurs to take out additional, non-compulsory insurance to cover the manager's unemployment, or loss of business, for example. Multirisque pro contracts are available on the market at affordable rates.
Despite the ease with which you can set up and manage your business under the simplified micro-social scheme, you need to have a good understanding of the terms and conditions governing this status to avoid certain pitfalls.
Being well-informed and keeping abreast of changes in legislation means you can take advantage of the many benefits offered by the auto entrepreneur status.
Written by our expert Paul LASBARRERES-CANDAU
February 20, 2018
