Industrial and commercial profits (BIC): real tax regime

Verified 16 February 2024 - Directorate for Legal and Administrative Information (Prime Minister)

Where a natural person subject to income tax (IR) receives income from a commercial, craft or industrial activity, that income is industrial and commercial profits (BIC). There are 3 different schemes with specific rules: micro-BIC, Simplified Real (SIR) or Normal Real (RN).

Industrial and Commercial Profits (BICs) correspond to profits generated by the following activities :

  • Commercial activity: purchase of materials and goods for resale or processing, provision of accommodation, catering, rental of goods, etc.
  • Deemed commercial activity: mine dealer, amodiary and sub-tenant of mining concessions, rental of commercial premises equipped, construction operations, etc.
  • Craft activity: hairdresser, baker etc.
  • Industrial activity: processing industry, mining industry, transport industry etc.

Persons likely to generate income belonging to the category of BIC: titleContent are:

  • Individual entrepreneur subject to income tax (IR)
  • Unique partner of a EURL: titleContent

Please note

The partner of a business subject to income tax (for example, CNS: titleContent, limited partnership, GIE: titleContent, SARL: titleContent that have opted for RI) may also generate income falling under the category of BICs.

The applicable tax regime depends on the amount of the company's turnover. This amount changes according to the nature of the activity.

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Business of trade and supply of housing

  • Where the annual turnover excluding tax (CAHT) is less than €188,700, the micro-BIC (micro-company) special scheme shall apply
  • Where the annual turnover excluding tax (CAHT) is between €188,700 and €840,000 However, the real simplified scheme applies
  • Where the annual turnover excluding tax (CAHT) is greater than €840,000However, the normal real regime applies

Rental of equipment or consumer durable goods

  • Where the annual turnover excluding tax (CAHT) is less than €188,700, the micro-BIC (micro-company) special scheme shall apply.
  • Where the annual turnover excluding tax (CAHT) is between €188,700 and €840,000However, the real simplified regime applies.
  • Where the annual turnover excluding tax (CAHT) is greater than €840,000However, the normal real regime applies.

Rental of furnished tourist

The turnover threshold (turnover threshold) for qualifying for the micro-company scheme for the rental of unclassified tourist furniture has been lowered. It applies to the AC generated from the year 2023. However, renters have the option to choose the application of the old regime on the turnover they generated in 2023.

For the rental of classified tourist furniture, the threshold of CA to benefit from the micro-company scheme has not changed.

Rental of classified tourist furniture
  • Where the annual turnover excluding tax (CAHT) is less than €188,700, the micro-BIC (micro-company) special scheme shall apply.
  • Where the annual turnover excluding tax (CAHT) is between €188,700 and €840,000However, the real simplified regime applies.
  • Where the annual turnover excluding tax (CAHT) is greater than €840,000However, the normal real regime applies.
Rental of unclassified tourist furniture
Old scheme (applicable on income option 2023)
  • Where the annual turnover excluding tax (CAHT) is less than €77,700, the micro-BIC (micro-company) special scheme shall apply.
  • Where the annual turnover excluding tax (CAHT) is between €77,700 and €254,000However, the real simplified regime applies.
  • Where the annual turnover excluding tax (CAHT) is greater than €254,000However, the normal real regime applies.
New regime (based on 2023 revenues)
  • Where the annual turnover excluding tax (CAHT) is less than €15,000, the micro-BIC (micro-company) special scheme shall apply.
  • Where the annual turnover excluding tax (CAHT) is between €15,000 and €254,000However, the real simplified regime applies.
  • Where the annual turnover excluding tax (CAHT) is greater than €254,000However, the normal real regime applies.

FYI  

However, for CAs generated from 2024 onwards, only the new regime applies.

Provision of services

  • Where the annual turnover excluding tax (CAHT) is less than €77,700, the micro-BIC (micro-company) special scheme shall apply.
  • Where the annual turnover excluding tax (CAHT) is between €77,700 and €254,000However, the real simplified regime applies.
  • Where the annual turnover excluding tax (CAHT) is greater than €254,000However, the normal real regime applies.

The company subject to actual taxation system (normal or simplified actual) shall report the amount of turnover generated by its activity during a accounting year, from which it withdrew the deductible expenses.

Examples of such charges are:

  • Overheads of all kinds
  • Remuneration of staff and manpower. The remuneration may be direct or indirect (e.g. fringe benefits, restaurant vouchers, pension scheme, etc.), must correspond to actual work and must not be excessive.
  • Paid leave allowance
  • Expenditure of a philanthropic nature (e.g. donation to a charity), educational, scientific, etc.

Please note

For the rules concerning the micro-company, you can consult the relevant sheet.

Depending on the tax regime that the company is subject to, the forms to be sent are different.

FYI  

The rules for micro-entrepreneurs (micro-BIC scheme) are set out in the topic sheet.

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Simplified real regime

The individual contractor must report the company with the form No. 2031 and the book of Annex Tables 2033-A to 2033-G.

This declaration must be made to the later than 15 days after 2e working day after 1er May.

He must send his declaration of results either by EDI-TDFC procedure, or on the online business tax account (EFI mode).

Normal Actual Speed

The individual contractor must report the company with the form No. 2031 and the bundle of Annex Tables Nos 2050, 2051, 2052, 2053, 2059-F and 2059-G. This declaration must be made to the later than 15 days after 2e working day after 1er May.

He must send his declaration of results by EDI-TDFC procedure.

The individual entrepreneur must also report income from his professional activity using the form #2042 C Pro at tax time. In addition, he must complete a "social" component in which he indicates the income used as a basis for calculating his social contributions.

Tax returns: Self-employed people can now correct their social data online

Entrepreneur - News

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Absence or delay of declaration

The company who shall not forward its declaration of results receives a formal notice of the tax administration. If she doesn't regularize her situation within 30 days, she is exposed to a compulsory taxation.

In case of delay or to transmission fault of the declaration of results, a mark-up shall be applied.

Depending on the situation, the company may be subject to one of the following sanctions:

  • Surcharge of 10% where the declaration has been lodged after formal notice within the 30-day period
  • Surcharge of 40% where the declaration has not been filed within 30 days or in the case of willful failure to comply
  • Surcharge of 80% in the event of fraud or abuse of rights
Incomplete Declaration

The company may also be penalized in the following cases:

  • Complementary document to the declaration of result not sent or sent late
  • Complementary document incomplete or with errors
  • Insufficient reporting
  • Refusal to produce list of partners or incomplete list
  • Refusal to produce the list of subsidiaries and participations or incomplete list
  • Sending the declaration by means other than electronic means

He is liable to a fine of 5% sums omitted when these documents are not produced or when they contain errors.

The company is picked automatically, no later than the 15th of the month, a down payment calculated on the basis of the profits declared for the previous year.

To determine the amount of tax, the progressive scale of income tax shall be applied to those profits.

If the company so wishes, its advance payments can be taken every 3 months : no later than 15 February, 15 May, 15 August and 15 November. She must then opt for no later than 1er October of the year preceding the year in which the option applies. This option is to be formulated with the company Tax Service (SIE) on which it depends:

Who shall I contact

The option is automatic rollover.

To terminate the option, the company must report it to the EIS: titleContent no later than 1er October of the year preceding the year in which the company wishes to waive the option.

When a company is subject to a tax regime based on the amount of its turnover, it has the option of opting for a more restrictive tax regime. In other words, it can opt for the regime that would apply if it exceeded the maximum turnover threshold of the regime to which it is currently subject. Thus, a micro-entrepreneur can opt for the simplified real regime and a company subject to the simplified real regime can opt for the normal real regime.

It is not possible to opt for a less restrictive regime.

micro-company company

The company subject to the micro-BIC scheme may opt for an effective taxation scheme. Depending on the company's situation, the option must be taken at different times:

  • When the company is subjected to the micro-company regime, the option shall be taken at the time of tax return of the year preceding the year in which the option is to be exercised
  • Where the company was subject to an effective (automatic) taxation regime the previous year, it must take the option at the time of its tax return the year in which it wishes the option to be exercised
  • When the company has just been created, the option must be taken at the time of tax return made in respect of the first year of operation
Company subject to the simplified system of taxation

Where a company is subject to the simplified effective system of taxation, it may opt for the ordinary effective system.

The timing of the option depends on seniority company:

  • The option is to be taken at the time of reporting the results of the year prior to the year in which you want the option to apply
  • When the company has just been set up, the option must be taken at the time of reporting for the first year of operation

FYI  

The option is valid 1 year and shall be automatically renewed each year.

The company may waive this option with the company Tax Office (SIE) on which it depends. The waiver is to be made at the time of the income statement for the year preceding the year in which the company wishes to waive the option.

Who shall I contact

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