Auto-entrepreneur status for car resales
The auto-entrepreneur status enables an individual working as a mechanic, or a dealer, to launch a car sales business. It offers a number of advantages, as business creation, management and accounting are simplified. A micro-business doesn't charge VAT if its sales fall below a certain threshold. You're guaranteed to find a Peugeot, Citroën, Renault, Volkswagen or Audi car at a very attractive price.
Becoming an auto-entrepreneur also enables the car salesperson to benefit from tax breaks for the first three years of business. On the other hand, it is impossible to make deductions for purchases when declaring annual sales. He is therefore taxed on the direct resale price of the vehicles, and not on the net profit. If your business model involves low margins and high expenses, this status is not for you.
In 2023, the annual sales ceilings for auto-entrepreneur status have been increased for services (BIC or BNC): €72,600 for the first year of business, then €100,800 for subsequent years.
These increases enable auto-entrepreneur car salespeople to envisage greater growth in their business without having to change their status.
- The auto-entrepreneur status allows car salespeople to offer additional services to vehicle sales, such as repair, maintenance or rental.
- Self-employed car salespeople must comply with certain advertising obligations, in particular by indicating their self-employed number on their communication media.
- Self-employed car salespeople can receive help and advice from public and private organizations.
Sole proprietorship for selling cars
Sole proprietorship is the perfect way to start an independent business such as car resale. However, it does present a risk, as your assets and those of the company will become one. So avoid opting for this form of company if you don't have solid experience in the field.
However, there are several advantages to choosing the status of sole trader if you want to set up your own business:
- company creation is simplified,
- no minimum capital required,
- accounting obligations are simplified,
- management is simple,
- decisions are made freely.
If you don't have private assets that you want to shelter, this status is interesting.
Selling a car as a SARL or EURL
You can sell used cars by setting up a SARL (limited liability company). If, on the other hand, you're starting out on your own, the right status for you is the EURL. This allows you to be taxed at the flat corporate tax rate. This is highly advantageous if you generate high profits from vehicle resales. Like the SARL, the EURL protects your personal assets. In this way, the entrepreneur is only liable for debts up to the amount of his or her contribution.
EURL and SARL also offer undeniable financial advantages. They allow you to obtain financing (credit) without great difficulty, but also to increase your financial support by simply increasing your capital.
SAS or SASU to become a car salesman
SAS status is perfect for a company specializing in the sale of used vehicles, because all you need is €1 in share capital. Whether you have debts or financial difficulties, your corporate assets are protected.
Both SAS and SASU offer numerous legal and social advantages. Tax benefits are attractive, and internal operations can be flexibly adapted. This type of company is ideal for vehicle dealers looking to make significant investments to launch their business.
Written by our editorial expert
August 18, 2023
