All you need to know about the taxation of a single-member company with limited liability (EURL)
Verified 01 January 2023 - Directorate for Legal and Administrative Information (Prime Minister)
Are you thinking of creating or have created a EURL and would you like to know the applicable tax rules? We provide you with the necessary information.
In the course of the completion by the business of the formalities relating to its tax system, there are a number of concepts specific to tax matters.
We present you a selection of the most common words and concepts, with their definition:
- Abatement : Flat-rate or proportional reduction applied on the basis of a tax calculation (income, value of property, etc.)
- Subjugation : Being compelled to pay something (for example, having to pay business tax)
- Turnover : Sum of a company's sales of goods or services in an accounting year
- Relief : Partial or total remission of a tax
- Dividends : Payment of money or shares of a company to its shareholders
- Fiscal year : The period during which a company records each economic event in the course of its activities. An accounting period generally lasts 12 months.
- Exemption : Exemption from payment of tax
- Income tax : Tax calculated and levied on income, profits and capital gains
- Tax on businesses : Tax calculated and levied on the annual profit of the company
- Recovery : Payment of a tax
- VAT : Tax that is not directly collected by the State. This tax is added to the price of all products to which it applies.
At the time of the creation of an EURL, it shall be automatically subject to income tax (IR) system. This means that profits will be taxed at the level of the single partner according to the rules of the IR.
You can opt for business tax (IS). Once you've chosen this SI plan, you have up to 5e the fiscal year following the year you chose to waive. It won't be possible afterwards.
If you wish to opt for business tax, you must do so with the company Tax Office (SIE) on which you depend:
Who shall I contact
Warning
If the sole partner is a business, then the tax regime automatically applicable is the business tax regime.
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Company subject to IR
You have to make your tax return before 2e working day following 1er May of the current year, by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
Online tax account for professionals (EFI mode)
The sole partner is taxed at source, i.e. the tax is directly charged to his income. An adjustment can be made the following year following his income tax return.
The website oups.gouv.fr shows you the common errors to avoid when paying and reporting your taxes.
Business subject to SI
General case
An income statement shall be made, the date of which shall depend on the date on which the last accounting year of the business was completed, by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The declaration must be made at one of the following times:
- If the accounting year is not closed on 31 December, within three months of the end of the financial year.
- If the accounting year is closed on 31 December, on 2e working day after 1er May of the following year.
The payment of the SI is made in 5 times via the EDI or EFI modes: 4 deposits and 1 balance. The tax rate is 25%.
Closing date of the financial year concerned | 1er down payment | 2e down payment | 3e down payment | 4e down payment |
|---|---|---|---|---|
From 20 February to 19 May N | 15 June N-1 | 15 September N-1 | 15 December N-1 | March 15 N |
May 20 to August 19 N | 15 September N-1 | 15 December N-1 | March 15 N | June 15 N |
20 August to 19 November N | 15 December N-1 | March 15 N | June 15 N | September 15 N |
November 20 N to February 19 N+1 | March 15 N | June 15 N | September 15 N | December 15 N |
Closing date of the financial year concerned | Balance |
|---|---|
31 December N-1 | 15 May N |
In year N | The 15th of the 4the month after closing |
SMB
An income statement shall be made, the date of which shall depend on the date on which the last accounting year of the business was completed, by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The declaration must be made at one of the following times:
- If the accounting year is not closed on 31 December, within three months of the end of the financial year.
- If the accounting year is closed on 31 December, on 2e working day after 1er May of the following year
The payment of the SI is made in 5 times via the EDI or EFI modes: 4 deposits and 1 balance. The tax rate is a reduced rate of 15%. It shall apply to the share of profits up to €42,500. Beyond that, the tax rate is 25%.
Closing date of the financial year concerned | 1er down payment | 2e down payment | 3e down payment | 4e down payment |
|---|---|---|---|---|
From 20 February to 19 May N | 15 June N-1 | 15 September N-1 | 15 December N-1 | March 15 N |
May 20 to August 19 N | 15 September N-1 | 15 December N-1 | March 15 N | June 15 N |
20 August to 19 November N | 15 December N-1 | March 15 N | June 15 N | September 15 N |
November 20 N to February 19 N+1 | March 15 N | June 15 N | September 15 N | December 15 N |
Closing date of the financial year concerned | Balance |
|---|---|
31 December N-1 | 15 May N |
In year N | The 15th of the 4the month after closing |
An EURL can be subject to payment a number of taxes, including:
- Value added tax (VAT)
- Company Property Tax (CFE)
- Company Value Added Tax (VAE)
VAT
Depending on the turnover and the annual amount of VAT that EURL generates, it will be subject to a different VAT regime:
- It shall be subject to the exemption from VAT if it has a turnover HT: titleContent less than €36,800 for the provision of services or less than €91,900 for trade and accommodation activities.
- It shall be subject to simplified real regime if it has a turnover HT: titleContent between €36,800 and €254,000 for the provision of services or between €91,900 and €840,000 for trade and accommodation activities.
The annual amount of VAT must be less than €15,000. - It shall be subject to normal real speed in one of the following 2 cases:
- If it has a turnover HT: titleContent greater than €254,000 for the provision of services or €840,000 for trading and providing housing
- If the annual amount of VAT is more than €15,000 even if the amount of turnover HT: titleContent is within the limits of the thresholds of the real simplified procedure
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VAT exemption
The business is not subject to VAT.
Simplified real regime
The declaration shall be made no later than 2e working day following 1er May.
VAT must be paid in two installments:
- 1er deposit of 55% in July
- 2nd deposit of 40% in December
The amount remaining to be paid is payable at the time of the next year's return.
The declaration and payment shall be made by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
Normal Actual Speed
The declaration and payment of VAT are to be made every month for the preceding month's VAT by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
CFE
A newly established company is not liable to the CFE in the year of its establishment and benefits from a reduction of 1re taxation year.
Depending on the activity of the company and where it is located, it may be temporarily or permanently exempt from the EWC.
The CFE shall be payable by the company which fulfills the following conditions:
- It must have a turnover or revenue exceeding 5 000. €
- She must habitually pursue a self-employed occupation.
The company must make an initial declaration no later than 31 December of the year of creation at the companies tax office of the place of its registered office:
Who shall I contact
Where the amount of the CFE is less than €3,000, it must be paid before 15 December.
Where the amount of the CFE is greater than or equal to €3,000, it must be paid in 2 installments, each corresponding to 50% of the amount:
- 1er deposit on 15 june
- 2e deposit on 15 december
Payment of the EWC shall be made by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
CVAE
A newly established company is not liable to the CVAE in the year of its creation. On the other hand, it is liable to the CVAE from the first year in the case of a transfer of activity.
The CVAE is due by the company which fulfills the following 2 conditions:
- She does more than €500,000 turnover HT: titleContent
- She carries out a gainful and usual self-employed professional activity and renters of non-professional furniture.
If the company has a turnover of more than €152,500, it must make a declaration of added value and staff numbers even if it is not necessarily subject to payment of the CVAE.
The declaration is to be made on 2e working day following 1er May by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The payment of the CVAE is made by means of 2 installments each corresponding to 50% of the contribution due where it is more than €1,500 :
- 1er deposit payable no later than 15 June of the taxation year
- 2e deposit payable no later than 15 September of the taxation year
A declaration of winding-up and regularization shall then be lodged, no later than 2e working day after 1er May of the year following the taxation year.
These payments and the winding-up declaration shall be made by dematerialization with the same intermediaries as the declaration (EDI or EFI).
The business manager doesn't necessarily receive any income. When they do, they are taxed.
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Associate Manager
Company subject to IR
Remuneration
The remuneration that the manager receives for his social mandate is taxed on income tax. He must indicate the amount of his income on his self-employed income tax return in the corresponding box (BIC or BNC).
He must perform his tax return by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from the subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
Dividends
As a partner, he may be required to touch dividends that fall into the category of income from movable capital. They are automatically imposed on the single flat-rate levy of 12.8%tax scale However, it is possible to opt for income tax. It is important to compare the 2 tax methods according to the amount of your dividends to choose the one that is most favorable to you.
The manager must declare his dividends by dematerialized means together with his income:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from the subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
Company subject to SI
Remuneration
The remuneration that the manager receives for his social mandate is taxed on income tax in the category of salaries and wages.
One abatement of 10% or a deduction of the amount of the actual costs (accommodation, meals, travel...) of the manager is made before the application of the tax.
They must file their income tax return using a paperless method:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- Directly from the subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
Dividends
As a partner, he may be required to touch dividends that fall into the category of income from movable capital. They are automatically imposed on the single flat-rate levy of 12.8%tax scale However, it is possible to opt for income tax. It is important to compare the 2 tax methods according to the amount of your dividends to choose the one that is most favorable to you.
The manager must declare his dividends by dematerialized means together with his income:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- If you are subject to the real simplified regime, directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
Non-associated manager
Company subject to IR
Remuneration
The remuneration that the manager receives for his social mandate is taxed on income tax. He must indicate the amount of his income on his self-employed income tax return in the corresponding box (BIC or BNC).
He must perform his tax return by dematerialized means:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- If you are subject to the real simplified regime, directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
Company subject to SI
Remuneration
The remuneration that the manager receives for his social mandate is taxed on income tax in the category of salaries and wages.
One abatement of 10% or a deduction of the amount of the actual costs (accommodation, meals, travel,...) of the manager is made before the application of the tax.
They must file their income tax return using a paperless method:
- Through an EDI (electronic data interchange) partner (EDI-TDFC mode)
- If you are subject to the real simplified regime, directly from your subscriber area on the impots.gouv.fr website (electronic form exchange or EFI)
The manager has no payment to make, he is direct debit at source.
If you have created a EURL, you can benefit fromtax relief and tax credits.
There are several tax breaks that will depend on either your business, or oflocation of your head office, oractions you will take :
- Tax benefits related to theplace where your head office is located :
- Tax benefits related to theactivity : tax credit for crafts
- Tax benefits related to thehiring of employees :
- Tax benefits related to actions you take :
FYI
when you create your company, you can benefit of tax exemptions over a short period. This is the case for the company property tax (CFE).
Simulator
Ministry of Economy