Income of the head of a business

Verified 26 April 2024 - Directorate for Legal and Administrative Information (Prime Minister)

The manager of a business may be required to receive remuneration. Depending on his role in the business, he may receive different types of income (dividends, employment contract, social mandate...). It is entirely possible to foresee that the manager will not receive remuneration.

SARL

The manager's remuneration varies depending on whether or not he is associated with the business. A manager is a partner if he or she has at least a share in the business that he or she manages.

The remuneration of the associate manager varies according to whether he is a majority, egalitarian or minority manager:

He is majority where it has more than 50% of shares business.

He is egalitarian when he holds 50% of shares business.

He is minority where it has less than 50% of shares business.

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Majority Manager

The majority managing partner can earn several salaries: dividends, remuneration for its social mandate and benefits.

1. Dividends

At the end of a social exercise, a SARL: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the manager can receive dividends that will be calculated based on the number of shares which he holds in the business.

When it receives dividends, it must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale income (IR) after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the most favorable tax method.

Dividends are not not subject to social security contributions provided they do not exceed 10% of the capital stock of the business.

2. Remuneration of the social mandate

The majority manager of a SARL: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting (AGO). The manager cannot decide alone. The remuneration must be proposed to a vote in which he has the right to participate. However, we must be careful that this vote is not a abuse of majority.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the corporate mandate is an operating expense for the business. Thus, it may be deducted from the business if it corresponds to actual work and is not excessive.

This remuneration is taxable to income tax (IR)in the salary and wages category. It is subject to social security contributions.

3. Benefits

The manager may also collect the benefits following:

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension

The manager cannot to grant themselves advantages without the agreement of the partners business.

The advantages granted to the manager also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of the business, provided that they correspond to a actual work and are not excessive.

Benefits are taxable at income tax (IR) in the salary and wages category.

4. Social status of the majority managing partner

The manager has the status of self-employed person, it shall be the responsibility of social security scheme for the self-employed even if he's not paid.

Egalitarian or minority manager

The equal or minority managing partner can earn several salaries: dividends, remuneration for its social mandate, remuneration for a employment contract and benefits.

1. Dividends

At the end of a exercise, a SARL: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the manager can receive dividends that will be calculated according to the number of shares which he holds in the business.

When the manager receives dividends, he must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale income (IR) after a reduction of 40%.

It is important to compare the two tax methods according to the amount of dividends received in order to choose the one that is the most favorable.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The equal or minority manager of a SARL: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The manager cannot decide alone. The remuneration must be proposed to a vote in which he has the right to participate.

It exists 3 shapes possible remuneration:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the corporate mandate is an operating expense for the business. Thus, it may be deducted from the business if it corresponds to actual work and is not excessive.

This remuneration is taxable to income tax (IR)in the salary and wages category. It is subject to social security contributions.

3. Remuneration of the employment contract

The egalitarian or minority manager can combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the manager and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the contract of employment constitutes an operating expense for the business. Thus, it is admitted in deduction of resultsbusiness, provided that it corresponds to actual work and is not excessive.

It is taxable at income tax (IR)in the category of salaries and wages. It is subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

4. Benefits

The manager may also collect the benefits following:

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The egalitarian or minority manager cannot grant himself benefits without the agreement of the other members business.

The advantages granted to the manager also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

Benefits are taxable at income tax (IR) in the category of salaries and wages.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

5. Social status of the leader

The equal or minority managing partner has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

The non-associate manager does not own shares in SARL. He cannot therefore receive dividends, unlike the partners.

However, he may combine several types of remuneration: remuneration for his social mandate, remuneration for its employment contract and benefits.

Remuneration of the social mandate

The non-associated manager of a SARL: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the corporate mandate is an operating expense for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

Remuneration is taxable at income tax (IR) in the category of salaries and wages. It is subject to social security contributions.

Remuneration of the employment contract

The non-associated manager may combine his corporate mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the widest powers and be completely independent in its activities.

The remuneration of the contract of employment constitutes an operating expense for the business. Thus, it is admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

It is taxable at income tax in the category of salaries and wages. It is subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

Benefits

The manager may collect the benefits following:

  • Benefits in kind : accommodation, car,...
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The unassociated manager cannot grant himself benefits without the agreement of the partners business.

The advantages granted to the manager also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of the business, as long as it corresponds to actual work and is not excessive.

These benefits are taxable to income tax (IR) in the salary and wages category.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

Social status of the manager

The unassociated manager has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives for his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

LOCK

The remuneration of the head of a LOCK: titleContent varies depending on whether it is associated or not. A director is a partner if he or she holds at least a share in the business that he or she manages.

FYI  

In an SAS, the director may be a single chairman, a chairman accompanied by a managing director or several managing directors. It can be a natural person or some other business.

The executive's remuneration varies according to whether he is a majority, minority or egalitarian partner.

He is majority where it has more than 50% business actions.

He is egalitarian when he holds 50% business actions.

He is minority where it has less than 50% business actions.

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Associate Majority Leader

The majority associate director of a LOCK: titleContent can accumulate several remuneration: dividends, a remuneration for its corporate mandate and benefits.

1. Dividends

At the end of a exercise, a LOCK: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the director can receive dividends which will be calculated according to the number of shares he holds in the business.

When the officer receives dividends, he or she must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale income (IR)after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the most favorable tax method.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The majority associate director of a LOCK: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting (AGO). The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate. However, we must be careful that this vote does not constitute a abuse of majority.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

Remuneration is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

3. Benefits

In addition to these remuneration (dividends and social mandate), benefits :

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension

The leader cannot to grant themselves advantages without the agreement of the other members business.

The advantages accorded to the leader also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

These benefits are taxable to income tax (IR)in the category of wages and salaries.

Associates can assign free of charge shares under the executive's social mandate. For more information, you can consult the Bofip page dedicated to the subject.

4. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate and benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Associate Equal or Minority Leader

The equal or minority associate director can earn several salaries: dividends, remuneration for a social mandate, remuneration for a employment contract and benefits.

1. Dividends

At the end of a exercise, a LOCK: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the director can receive dividends which will be calculated according to the number of shares he holds in the business.

When it receives dividends, it must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale in income after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the one that is the most favorable.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

A minority or egalitarian associate officer of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting (AGO). The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

Remuneration is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

3. Remuneration of the employment contract

The director may combine his social mandate without a SAS with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for business. Thus, it is admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

It is taxable at income tax in the category of wages and salaries. They are subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

4. Benefits

Of benefits in addition to these remuneration (dividends, social mandate, employment contract):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end.
  • Special allowance retirement and supplementary pension for the spouse.

The leader cannot give himself benefits without the agreement of the other members.

The advantages accorded to the leader also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive. They are taxable at income tax (IR) in the category of wages and salaries.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

Associates can assign free of charge shares under the company's mandate and/or under the manager's employment contract. For more information, you can consult the Bofip page dedicated to the subject.

5. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives for his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

The remuneration of the governing business varies according to whether it is a majority, minority or egalitarian partner.

She's majority where it holds more than 50% business actions.

She's egalitarian when it holds 50% business actions.

She's minority where it has less than 50% business actions.

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Associate Majority Leader (business)

The majority associate business that runs a LOCK: titleContent can accumulate several remuneration: dividends and one remuneration for its corporate mandate.

1. Dividends

At the end of a exercise, a LOCK: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the managing business may receive dividends which will be calculated on the basis of the number of shares it holds in the SAS.

The dividends received must be declared. The way in which dividends are taxed varies according to the way in which the governing business is taxed:

  • If the governing business is subject to theIS: titleContent : dividends are taxed at the business rate.
  • If the governing business is subject to theIR: titleContent : dividends are taxed in the category of income from movable capital or in the category of BIC: titleContent/NBC: titleContent whether they constitute income from professional or non-professional activity.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The majority associate governing business of a LOCK: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting (AGO). The ruling business cannot decide its remuneration alone. It must be put to a vote in which it has the right to participate. However, we must be careful that this vote is not one abuse of majority.

It exists 3 shapes possible remuneration:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results of the SAS, provided that it corresponds to a actual work and is not excessive.

The method of taxation of remuneration varies according to the method of taxation of the governing business:

  • If the governing business is subject to theIS: titleContent : dividends are taxed at the business rate.
  • If the governing business is subject to theIR: titleContent : dividends are taxed in the category of income from movable capital or in the category of BIC: titleContent/NBC: titleContent whether they constitute income from professional or non-professional activities.

The activity carried out under the company mandate shall be treated as a provision of services from the governing business. Thus, it is taxable person.

Associate equal or minority (business) leader

The associated egalitarian or minority business that runs a LOCK: titleContent may collect dividends and one remuneration for its corporate mandate.

1. Dividends

At the end of a exercise, a LOCK: titleContent can make a profit. The partners may, depending on the needs and plans of the business, decide to set aside or distribute these profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to the partners, we are talking about dividends.

Thus, the managing business may receive dividends which will be calculated on the basis of the number of shares it holds in the SAS.

The dividends received must be declared. The way in which dividends are taxed varies according to the way in which the governing business is taxed:

  • If the governing business is subject to theIS: titleContent : dividends are taxed at the business rate.
  • If the governing business is subject to theIR: titleContent : dividends are taxed in the category of income from movable capital or in the category of BIC: titleContent/NBC: titleContent whether they constitute income from professional or non-professional activity.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The minority or egalitarian associate governing business of a LOCK: titleContent exercise a social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting (AGO). The ruler cannot decide alone. The remuneration must be proposed to a vote in which he has the right to participate.

It exists 3 shapes possible remuneration:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results of the sas, provided that it corresponds to actual work and is not excessive.

The method of taxation of remuneration varies according to the method of taxation of the governing business:

  • If the governing business is subject to theIS: titleContent : dividends are taxed at the business rate.
  • If the governing business is subject to theIR: titleContent : dividends are taxed in the category of income from movable capital or in the category of BIC: titleContent/NBC: titleContent whether they constitute income from professional or non-professional activities.

The activity carried out under the company mandate shall be treated as a provision of services from the governing business. Thus, it is subject to VAT.

The director is not a partner of the business when he or she does not own a share of the company. He cannot therefore receive dividends, unlike the partners.

However, he has the possibility to accumulate several remuneration: a remuneration for its corporate mandate, a remuneration under his contract of employment and benefits.

Remuneration of the social mandate

The leader of a LOCK: titleContent exercise a social mandate which may be free of charge or paid.

He can waive his remuneration if he wishes.

The choice remuneration and sound upright under the social mandate may be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a general meeting

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. This amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

This remuneration is taxable to income tax (IR) in the category of wages and salaries. It is subject to social security contributions.

Remuneration of the employment contract

The leader may combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

It is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

Associates can assign free of charge shares under the company's mandate and/or under the manager's employment contract. For more information, you can consult the Bofip page dedicated to the subject.

Benefits

The leader cannot give himself benefits without the agreement of the partners business.

Of benefits may be added to the remuneration which the director may receive (dividends, employment mandate, contract of employment):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The advantages accorded to the leader also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

These benefits are taxable to income tax (IR)in the category of wages and salaries.

Social status of the non-associated manager

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

A governing business shall be a non-member of the business where it does not hold shares in the latter. It cannot therefore receive dividends, unlike the partners.

The non-associated governing business may receive a remuneration for its corporate mandate.

The governing business of a LOCK: titleContent exercise a social mandate which may be free of charge or paid.

They can waive the remuneration if they wish.

The choice remuneration and sound upright under the social mandate may be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a general meeting

It exists 3 forms of remuneration the following are possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. This amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

The method of taxation of remuneration varies according to the method of taxation of the governing business:

  • If the governing business is subject to theIS: titleContent : dividends are taxed at the business rate.
  • If the governing business is subject to theIR: titleContent : dividends are taxed in the category of income from movable capital or in the category of BIC: titleContent/NBC: titleContent whether they constitute income from professional or non-professional activities.

The activity carried out under the company mandate shall be treated as a provision of services from the governing business. Thus, it is subject to VAT.

SA

Management may be exercised by different parties depending on the type of public limited company:

  • One public limited liability company with a board of directors shall be headed by the Chairman of the Management Board, the Director-General or the Deputy Director-General.
  • One public limited liability company with a board of directors shall be managed by the members of the Executive Board.

The rules on remuneration vary depending on whether the manager is a shareholder of the business. A director shall be a shareholder if he holds at least one share in the business. The rules also vary depending on whether the manager is a member of the board of directors or not.

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Director shareholder manager

The executive's remuneration varies according to whether he is a majority, minority or equal shareholder.

The leader is majority where it has more than 50% actions of the business.

The leader is egalitarian when he holds 50% actions of the business.

The leader is minority where it has less than 50% actions of the business.

Majority Partner

As a majority shareholder executive member of the board of directors, he has the opportunity to earn several salaries: dividends, a remuneration for his role as administrator, a remuneration for its corporate mandate and benefits.

1. Dividends

At the end of a exerciseHowever, a business can make a profit. Shareholders may, depending on the needs and plans of the business, decide to set aside or distribute such profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to shareholders, we are talking about dividends.

Thus, the director can receive dividends which will be calculated according to the number of shares he holds in the business. When the officer receives dividends, he or she must declare them.

They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale in income after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the most favorable tax method.

2. Remuneration for his status as a director

Shareholders meeting at a general meeting may decide to pay an annual remuneration to the members of the board of directors of the business. This is a general decision taken at the general meeting held to approve the business' accounts, but it can be taken at another ordinary general meeting (AGO).

The amount granted is then distributed among the directors by the board of directors. In general, the chairman or director will receive a higher share. The director may waive such remuneration.

The remuneration received by the director for his or her role as a director is taxed in the category of income from movable capital in the single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for a tax on tax scale income (IR)after a reduction of 40%.

The officer may deduct from this remuneration the costs incurred during the year for his activity as a director for their actual amount and with proof. This deduction tax scale is possible if he has opted for income tax.

Such remuneration shall not be not subject to social security contributions.

3. Remuneration of the social mandate

The majority officer of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The controlling shareholder manager cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate. However, we must be careful that this vote is not one abuse of majority.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

Remuneration is taxable at income tax in the category of wages and salaries. It is subject to social security contributions.

4. Benefits

Of benefits may be added to the remuneration that the director may receive (dividends, director status, corporate mandate):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension

The leader cannot to grant themselves advantages without the agreement of the shareholders business.

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

These benefits are taxable to income tax (IR)in the category of wages and salaries.

5. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Equal or minority shareholder

The minority or egalitarian shareholder director may receive several remuneration: dividends, a remuneration for his role as administrator, a remuneration under a company mandate, one pay under a contract of employment and benefits.

1. Dividends

At the end of a exerciseHowever, a business can make a profit. Shareholders may, depending on the needs and plans of the business, decide to set aside or distribute such profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to shareholders, we are talking about dividends.

Thus, the manager can receive dividends that will be calculated based on the number of shares he holds in the business.

When the officer receives dividends, he or she must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale in income after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the one that is the most favorable.

Dividends are not not subject to social security contributions.

2. Remuneration for his status as a director

Shareholders meeting at a general meeting may decide to pay an annual remuneration to the members of the board of directors of the business. This is a general decision taken at the general meeting held to approve the business' accounts, but it can be taken at another ordinary general meeting (AGO).

The amount granted is then distributed among the directors by the board of directors. In general, the chairman or director will receive a higher share. The director may waive his remuneration.

The remuneration received by the director for his or her role as a director is taxed in the category of income from movable capital in the single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for a tax on tax scale income (IR)after a reduction of 40%.

The officer may deduct from this remuneration the costs incurred during the year for his activity as a director for their actual amount and with proof. This deduction tax scale is possible if he has opted for income tax.

Such remuneration shall not be not subject to social security contributions.

3. Remuneration of the social mandate

The minority or egalitarian leader of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The ruler cannot decide alone. The remuneration must be proposed to a vote in which he has the right to participate.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

Remuneration is taxable at income tax in the category of wages and salaries. It is subject to social security contributions.

4. Remuneration of the employment contract

The leader may combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for business. Thus, it is admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

It is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

5. Benefits

The leader cannot give himself benefits without the agreement of the shareholders business.

Of benefits may be added to the remuneration the director may receive (dividends, director status, corporate mandate, employment contract):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The advantages accorded to the leader also represent a operating load for business. Thus, the sums paid are admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

These benefits are taxable to income tax (IR) in the category of wages and salaries.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

6. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Non-shareholder director

The non-shareholder director may earn several remuneration: remuneration for his administrator role, remuneration for a social mandate, remuneration for a employment contract and benefits.

1. Remuneration for his status as a director

Shareholders meeting at a general meeting may decide to pay an annual remuneration to the members of the board of directors of the business. This is a general decision taken at the general meeting held to approve the business' accounts, but it can be taken at another ordinary general meeting (AGO).

The amount granted is then distributed among the directors by the board of directors. In general, the chairman or director will receive a higher share. The director may waive his remuneration.

The remuneration received by the director for his or her role as a director is taxed in the category of income from movable capital in the single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for a tax on tax scale income (IR)after a reduction of 40%.

The officer may deduct from this remuneration the costs incurred during the year for his activity as a director for their actual amount and with proof. Tax scale This deduction is possible if he has opted for income tax.

Such remuneration shall not be not subject to social security contributions.

2. Remuneration of the social mandate

The head of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

It is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

3. Remuneration of the employment contract

The leader may combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for the business. Thus, it is admitted in deduction of results business, provided that it corresponds to actual work and is not excessive.

It is taxable at income tax (IR)in the category of wages and salaries. It is subject to social security contributions.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

4. Benefits

Of benefits may be added to the remuneration that the director may receive (dividends, director status, corporate mandate):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The leader cannot give himself benefits without the agreement of the shareholders business.

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

These benefits are taxable to income tax (IR) in the category of wages and salaries.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

5. Tax and social arrangements for remuneration

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Non-director shareholder manager

The executive's remuneration varies according to whether he is a majority, minority or equal shareholder.

The leader is majority where it has more than 50% actions of the business.

The leader is egalitarian when he holds 50% actions of the business.

The leader is minority where it has less than 50% actions of the business.

Majority shareholder

The majority shareholder director on the board of directors may earn several salaries: dividends, remuneration for its social mandate and benefits.

1. Dividends

At the end of a exerciseHowever, a business can make a profit. Shareholders may, depending on the needs and plans of the business, decide to set aside or distribute such profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to shareholders, we are talking about dividends.

Thus, the director can receive dividends that will be calculated based on the number of shares he holds in the business.

When the officer receives dividends, he or she must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale income (IR) after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the most favorable tax method.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The majority officer of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate. However, we must be careful that this vote is not one abuse of majority.

It exists 3 shapes possible remuneration:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results of the business, as long as it corresponds to actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries.

3. Benefits

Of benefits may be added to the remuneration the director may receive (dividends, corporate mandate):

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension

The leader cannot to grant themselves advantages without the agreement of the shareholders business.

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

Benefits are taxable at income tax (IR) in the category of wages and salaries.

4. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate and benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Equal or minority shareholder

The shareholder manager who is an egalitarian or a minority shareholder may receive several remuneration: dividends, remuneration for a social mandate, a pay under a contract of employment and benefits.

1. Dividends

At the end of a exerciseHowever, a business can make a profit. Shareholders may, depending on the needs and plans of the business, decide to set aside or distribute such profits. This decision shall be taken at the general meeting when the accounts are approved. When these profits are distributed to shareholders, we are talking about dividends.

For example, managers can collect dividends on the basis of the number of shares in the business.

When it receives dividends, it must declare them. They are taxed in the category of income from movable capital in Canada single flat-rate levy to 30% (12.8% income tax and 17.2% social security contributions). However, it is possible to opt for the taxation of dividends in the tax scale income (IR)after a reduction of 40%.

It is important to compare the two tax methods based on the amount of dividends received to choose the one that is the most favorable.

Dividends are not not subject to social security contributions.

2. Remuneration of the social mandate

The minority or egalitarian shareholder director of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries. It is subject to social security contributions.

3. Remuneration of the employment contract

The leader may combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for the business. Thus, it is admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

4. Benefits

Of benefits may be added to the remuneration received by the manager:

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The leader cannot give himself benefits without the agreement of the shareholders business.

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

These benefits are taxable to income tax in the category of wages and salaries.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

5. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Non-shareholder executive and non-director

A non-shareholder and non-director officer may earn several remuneration: remuneration in respect of his social mandate, remuneration in respect of of a contract of employment and benefits.

1. Remuneration of the corporate mandate

The non-shareholder and non-director officer of a business shall exercise social mandate which may be free of charge or paid.

The choice remuneration and sound upright can be determined in one of the following ways:

  • In the statutesYeah, but it's rare. Compensation may have to change, the fact that it is enshrined in the statutes makes it more difficult to change.
  • During a ordinary general meeting. The executive cannot decide his or her remuneration alone. It must be put to a vote in which he has the right to participate.

It exists 3 forms of remuneration possible:

  • Fixed remuneration (fixed salary): The amount of remuneration is determined and it is not supposed to move. It may also be fixed in relation to the amount of the salary of an employee of a defined hierarchical level. For example, this amount is equal to x times the amount of this employee's salary.
  • Proportional remuneration (proportional treatment): the amount of remuneration is proportional to the profits or turnover of the business.
  • Fixed and proportional remuneration : a part is fixed and determined. The other part varies according to the profits or turnover of the business.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries. It is subject to social security contributions.

2. Remuneration of the employment contract

The leader may combine his social mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the ruler and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for the business. Thus, it is admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

3. Benefits

Of benefits may be added to the remuneration received by the manager:

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The leader cannot give himself benefits without the agreement of the shareholders business.

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of the business, as soon as it corresponds to actual work and is not excessive.

These benefits are taxable to income tax in the category of wages and salaries.

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

4. Social status of the leader

The leader has the employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.

Remuneration of the social mandate

The members of the Executive Board of a business shall exercise social mandate which may be free of charge or paid.

Remuneration for the office of the company is a operating load for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries. It is subject to social security contributions.

Remuneration of the employment contract

Members of the Executive Board may combine their corporate mandate with a employment contract if the following conditions are met:

  • The employment contract must correspond to a technical and actual work distinct from that exercised under the corporate mandate.
  • There must be a subordinate relationship between the Executive Board member and the business. It must not have the greatest powers nor be totally independent in its activities.

The remuneration of the employment contract constitutes a operating load for the business. Thus, it is admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

It is taxable at income tax (IR) in the category of wages and salaries.

Example :

The head of a business carries out, in addition to his corporate mandate, the functions of a seller in one of his shops. He receives remuneration for his activity as a seller through an employment contract. His work is controlled by the partners of the business, in other words, he is not autonomous. All conditions are met for the cumulation to be valid.

To get an idea of the cost of the employment contract, you can consult the following gross salary simulator:

Income simulator for an employee

FYI  

The modification or termination of the company's mandate shall not result in the termination of the contract of employment.

Benefits

The leader cannot give himself benefits without the agreement of the shareholders business.

He can collect the benefitsfollowing:

  • Benefits in kind : accommodation, car, etc.
  • Exceptional reward year-end
  • Special allowance retirement and supplementary pension for the spouse

The advantages accorded to the leader also represent a operating load for the business. Thus, the sums paid are admitted in deduction of results of business, if it corresponds to a actual work and is not excessive.

These benefits are taxable to income tax (IR)in the category of wages and salaries.

Social status of the members of the Executive Board

A director who is a member of the Executive Board shall employee status, which allows it to take advantage of the general scheme for the protection of employees. He pays contributions on the basis of the remuneration he receives under his social mandate, his employment contract (if he has one) and his benefits.

On the other hand, he does not contribute for unemployment insurance to which he is not entitled. He may eventually be eligible for unemployment insurance as part of his employment contract if he has one.