Everything you need to know about the taxation of a micro-entrepreneur

Verified 01 January 2024 - Legal and Administrative Information Directorate (Prime Minister)

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You are engaged in a commercial or craft activity

You are automatically subject to the micro-speedBIC: titleContent of income tax, but you can apply to be taxed on normal real income tax system.

Under micro-BIC, you are automatically picked up at source unless you opt for the discharge payment. This choice is possible when your tax income for year N-2 does not exceed one of the following thresholds depending on your family situation:

  • If you're a single person, €27,478
  • If you are in a couple and on the same tax household, €54,956
  • If you are a couple in the same tax home with 1 child, €68,695
  • If you are a couple in the same tax home with 2 children, €82,434
Micro BIC Scheme: Final payment

In this case, you pay your tax (and your social contributions) in a single installment.

You can opt for the discharge payment depending on your situation on the following dates:

  • If you start your activity, before the 3e month after your company was created
  • Before September 30 of the year preceding the year for which you wish the option to be exercised.

The timing of your tax return depends on your situation:

  • This is your first statement:
    • You have chosen the monthly payment: you must file your return on the last day of 3e month after the month in which you started your business
    • You have chosen the quarterly remittance: you must file your return on the last day of 6e months after you started your business
  • This is not your first statement:
    • You have chosen the monthly payment: you must file your return at the end of the following month
    • You have chosen the quarterly remittance: you will have to file your return on April 30, July 31, October 31 and January 31

You do not have to provide a professional profit statement. You must indicate your turnover to theUrssaf: titleContent using your supplementary income tax return (2042-C Pro):

Supplementary declaration of income from self-employed occupations

You must indicate your turnover in the "Micro-entrepreneurs who have opted for the final withholding of income tax".

In micro-BIC mode, a abatement flat rate is applied to your turnover, depending on the nature of your business:

  • 71% of your CA for your activities of purchase-resale or supply of accommodation (for furnished rentals, this only concerns furnished rentals of tourism and of guest rooms)
  • 50% of your CA for other activities

Warning  

The 2024 budget amended the rules on direct or indirect rentals of furnished tourist accommodation. They will be added to our page as soon as we have more details on the subject.

Micro-BIC scheme: Withholding tax

Every month or quarter, a deposit is taken directly from your bank account.

You have to file your tax return by one of the following dates depending on your situation:

  • This is your first statement:
    • You have chosen the monthly payment: you must file your return on the last day of 3e month after the month in which you started your business
    • You have chosen the quarterly remittance: you must file your return on the last day of 6e months after you started your business
  • This is not your first statement:
    • You have chosen the monthly payment: you must file your return at the end of the following month
    • You have chosen the quarterly remittance: you will have to file your return on April 30, July 31, October 31 and January 31

You do not have to provide a professional profit statement. You must indicate your turnover to theUrssaf: titleContent using your supplementary income tax return (2042-C Pro):

Supplementary declaration of income from self-employed occupations

In micro-BIC mode, a abatement flat rate is applied to your turnover, depending on the nature of your business:

  • 71% of your CA for your activities of purchase-resale or supply of accommodation (for furnished rentals, this only concerns furnished rentals of tourism and of guest rooms)
  • 50% of your CA for other activities

Warning  

The 2024 budget amended the rules on direct or indirect rentals of furnished tourist accommodation. They will be added to our page as soon as we have more details on the subject.

Normal Actual Speed

You must file your tax return before the 2nde working day after 1er May.

You do not have to provide a professional profit statement. You must indicate your turnover to theUrssaf: titleContent using your supplementary income tax return (2042-C Pro):

Supplementary declaration of income from self-employed occupations

In micro-BIC mode, a abatement flat rate is applied to your turnover, depending on the nature of your business:

  • 71% of your CA for your activities of purchase-resale or supply of accommodation (for furnished rentals, this only concerns furnished rentals of tourism and of guest rooms)
  • 50% of your CA for other activities

Warning  

The 2024 budget amended the rules on direct or indirect rentals of furnished tourist accommodation. They will be added to our page as soon as we have more details on the subject.

You're in a business

You are automatically subject to the micro-speedNBC: titleContent of income tax, but you can apply to be taxed on normal real income tax system.

In micro-BNC mode, you are automatically picked at source unless you opt for the discharge payment . This choice is possible when your tax income for year N-2 does not exceed one of the following thresholds depending on your family situation:

  • If you're a single person, €27,478
  • If you are in a couple and on the same tax household, €54,956
  • If you are a couple in the same tax home with 1 child, €68,695
  • If you are a couple in the same tax home with 2 children, €82,434
Micro-NLC scheme: payment on discharge

In this case, you pay your tax (and your social contributions) in a single installment.

You can opt for the discharge payment on one of the following dates depending on your situation:

  • Before September 30 of the year preceding the year for which you wish the option to be exercised.
  • If you start your activity, before the 3e month after your company was created

You have to file your tax return by one of the following dates depending on your situation:

  • This is your first statement:
    • You have chosen the monthly payment: you must file your return on the last day of the 3e month after the month in which you started your business
    • You have chosen the quarterly remittance: you must file your return on the last day of 6e months after you started your business
  • This is not your first statement:
    • You have chosen the monthly payment: you must file your return at the end of the following month
    • You have chosen the quarterly remittance: you will have to file your return on April 30, July 31, October 31 and January 31

You must declare your turnover to theUrssaf: titleContent using the following form:

Supplementary declaration of income from self-employed occupations

You must indicate your turnover in the "Micro-entrepreneurs who have opted for the final withholding of income tax".

Under micro-BNC arrangements, a flat-rate reduction of 34% is applied to your turnover.

Micro-BNC regime: source levy

Every month or quarter, a deposit is taken directly from your bank account.

You have to file your tax return by one of the following dates depending on your situation:

  • This is your first statement:
    • You have chosen the monthly payment, you must file your return on the last day of the third month following the month in which you started your business
    • You have chosen the quarterly remittance, you must file your return on the last day of 6eme months after you started your business
  • This is not your first statement:
    • You have chosen the monthly payment, you must file your return at the end of the following month
    • You have chosen the quarterly remittance you will have to file your return on April 30, July 31, October 31 and January 31

You must declare your turnover to theUrssaf: titleContent using the following form:

Supplementary declaration of income from self-employed occupations

Under micro-BNC arrangements, a flat-rate reduction of 34% is applied to your turnover.

Arrangements for the controlled declaration

You must opt for taxation under the controlled declaration system before the 2nde working day following 1er May. You must also file your tax return by this date.

FYI  

When you file your return online, you have a additional period of 15 days.

You must declare your turnover to theUrssaf: titleContent using the following form:

Supplementary declaration of income from self-employed occupations

You must also contact your NLC income statement.

You can be subject to payment a number of taxes, including:

  • Value added tax (VAT)
  • Company Property Tax (CFE)
VAT

Depending on your turnover and the annual amount of your VAT, 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.

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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:

Normal Actual Speed

The declaration and payment of VAT are to be made every month for the preceding month's VAT by dematerialized means:

CFE

A new entrepreneur is not liable to the CFE in the year of its creation and it benefits from a reduction on 1re taxation year.

Depending on the activity of the entrepreneur and where he is located, it is possible that he is temporarily or permanently exempt from the EWC.

The CFE is payable by the contractor who fulfills the following conditions:

  • It has a turnover or revenue exceeding €5,000
  • She habitually pursues a self-employed occupation

The contractor 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:

Initial Declaration 1447-C-SD (CFE)

Who shall I contact

If you are a micro-entrepreneur, you have the opportunity to 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 :

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).

During the completion of the formalities related to its tax system, a certain number of vocabulary words and concepts specific to tax matters.

We present you a list of words and concepts that you will be likely to find often, 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
  • Controlled Declaration : Reporting scheme for non-commercial profits above €77,700 HT: titleContent
  • Relief : Partial or total remission of a tax
  • Fiscal year : The period during which a company records each economic event in the course of its activities. An accounting period generally lasts for 12 months
  • Exemption : Exemption from payment of tax
  • VAT exemption : Special scheme which exempts the company from declaring and paying VAT on supplies or sales made by it
  • Income tax : Tax calculated and levied on income, profits and capital gains
  • Recovery : Payment of a tax
  • Micro-tax system : Special tax arrangements for individual companies whose turnover HT: titleContent does not exceed certain thresholds
  • Normal Actual Speed : Taxation regime that applies to profits and VAT. It applies to companies with a turnover HT: titleContent above certain thresholds
  • Simplified real regime : Taxation regime that applies to profits and VAT. It applies to companies with a turnover HT: titleContent between 2 thresholds.
  • VAT : Tax that is not directly collected by the State. This tax is added to the price of all products to which it applies

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