Micro-entrepreneurs benefit from the simplified microsocial regime, which greatly simplifies administrative, legal and tax formalities.
This status is suitable for all commercial, craft and liberal professions. Only agricultural activities are excluded.
Let's find out everything you need to know before embarking on the adventure of entrepreneurship with a micro-business!
Micro-businesses are so popular because, above all, they're simple and flexible to manage! All you need to do to set up a business is fill in a single form online, and you don't need to provide any form of deposit or guarantee.
Under the simplified microsocial tax system , you pay your contributions on the basis of your sales, and report your income on yourincome tax return.
But above all, the flexibility of the status is its greatest asset!
You then have complete freedom of organization.
You can choose the tasks you wish to carry out, your place of work, your working hours, etc.
In particular, this allows contractors to optimize their efficiency according to their preferences.
For several years now, microentrepreneurs have been required to have professional insurance .
Also, those using a transport vehicle (such as Uber drivers, for example) must take out civil liability insurance.
Contractors in the construction and public works sector are required to take out ten-year and professional liability insurance.
Since January 1, 2019, micro-entrepreneurs with less than €5,000 in annual sales have been exempt from paying the CFE (Cotisation Foncière des Entreprises).
If this is not the case, it must be paid each year.
To qualify for micro-entrepreneur status, you must not exceed the official sales ceiling.
It is set at €170,000 for commercial activities and the provision of accommodation, and €70,000 for service providers and self-employed professionals.
If your company has a low net margin, the micro-entrepreneur status can be penalizing, as social security contributions are calculated on the basis of sales, without any deductions.
This may be the case in a business that is expanding rapidly, or that requires very substantial expenditure.
A micro-entrepreneur is considered a non-salaried worker affiliated to the independent workers' social security scheme.
The social charges to be paid are as follows:
- For sales of goods and accommodation supplies (except furnished residential rental and furnished tourist accommodation): 12.8%.
- Furnished residential rental, provision of services, liberal professions covered by RSI and CIPAV: 22%.
- Rental of furnished tourist accommodation: 6%.
It is possible to benefit from the ACCRE scheme when you set up your business, in order to benefit from a partial exemption from social security contributions.
You are then liable for income tax
Taxable profit is calculated by applying a flat-rate deduction to your sales, amounting to :
-
71% for the activities of purchase/resale, provision of accommodation, sale for consumption on the premises
- 50% for commercial services
- 34% for non-commercial services (e.g. liberal professions)
It is possible to opt for the flat-rate withholding tax (prélèvement libératoire forfaitaire), enabling you to pay a single rate including social security contributions and income tax in a single payment.
Micro-entrepreneurs are totally exempt from VAT. They do not charge it, and therefore cannot reclaim it on their expenses.
Becoming a micro-entrepreneur couldn't be easier: just visit www.lautoentrepreneur.fr or guichet-entreprises.fr.
These two official platforms, created by the French government, allow you tocarry out all your formalities online.
Your declaration of commencement of activity can be made on a single form
The following information must be provided:
- Your business address
- Contact details for the sole shareholder
- Choice of health insurance organization and declaration of rights
- Preference for payment in full discharge of income tax
For retailers and craftsmen, a certificate of registration with the relevant official register is mandatory. All you need to enclose is a copy of your identity card.
More than 1.2 million French people have adopted the micro-entrepreneur status since its creation in 2008!
Particularly attractive because it is easy to set up, manage and wind up, it is ideal for launching a project or running a sideline business.
Between 2017 and 2018, micro-enterprise registrations rose by 28%, making it the most dynamic legal status nationwide!
This success can be explained by the legislative changes that have come into force since January 1ᵉʳ, 2018, and in particular the doubling of sales thresholds.
Written by our expert Paul LASBARRERES-CANDAU
August 9, 2019
