[monsieur smith]

Hello,

I have heard that the French social charges system is changing for 'auto-entrepreneurs' to reduce the cost of running a small business there.

I do not know if it will apply only to new businesses or it will cover existing set ups?

Does anyone have any further information on this?

Thanks

 

[Bevdeforges]

The statute for "auto-entrepreneurs" came into existence on January 1, 2009.

It is similar to, but not precisely the same, as some of the other regimes - probably the micro-BIC is the closest (though that is a regime for income taxes and VAT, not for social charges). I think (but am not sure) that if you qualify, you can change the statute of an existing business to the auto-entrepreneur one - but you have to do the filing. It's not automatic.

Basically, you wind up paying income tax and social charges based on your gross revenue (I think it's equivalent to what the Brits refer to as "turnover.") As a result, there is no obligation to keep accounting records - just a list of your sales. The limits are coordinated with the thresholds for VAT filings, so basically, if you're an auto-entrepreneur you aren't bothered with VAT (but cannot claim VAT paid either).
Cheers,
Bev

 

[Matou]

It is possible to change status for auto-entrepreneur if one qualifies (I think that the main condition is a gross revenue of € 32.000 in the service industry and € 80.000 in the trading industry).
The most intersting thing as far as charges are concerned is that an auto-entrepreneur will pay them in bulk (i.e. kind of "formula tax) to a set amount of 23% of the gross revenue for service or 13% for trade. It is supposed to simplify things both to reduce moonlighting and to keep active retired persons with interesting competences.

 

[Bevdeforges]

It is possible to change status for auto-entrepreneur if one qualifies (I think that the main condition is a gross revenue of € 32.000 in the service industry and € 80.000 in the trading industry).

Just to clarify - those revenue figures are the MAXIMUM you can be taking in to qualify for the auto-entrepreneur statute. Once your revenue is above these amounts, you need to register for VAT and start keeping real books (i.e. expenses and revenues).
Cheers,
Bev

 

[slm19]

The statute for "auto-entrepreneurs" came into existence on January 1, 2009.

It is similar to, but not precisely the same, as some of the other regimes - probably the micro-BIC is the closest (though that is a regime for income taxes and VAT, not for social charges). I think (but am not sure) that if you qualify, you can change the statute of an existing business to the auto-entrepreneur one - but you have to do the filing. It's not automatic.

Basically, you wind up paying income tax and social charges based on your gross revenue (I think it's equivalent to what the Brits refer to as "turnover.") As a result, there is no obligation to keep accounting records - just a list of your sales. The limits are coordinated with the thresholds for VAT filings, so basically, if you're an auto-entrepreneur you aren't bothered with VAT (but cannot claim VAT paid either).
Cheers,
Bev

Hello,

With the auto-entrepreneurs status in France, do I still need to pay social security and self employment taxes in the US?

Thank you

 

[Bevdeforges]

Hello,

With the auto-entrepreneurs status in France, do I still need to pay social security and self employment taxes in the US?

Thank you

Check Publication 54 on the IRS website, but when last I checked (a few years ago before the auto-entrepreneur thing came into being) there was something in there specifically related to this sort of thing. As long as your business is registered in France under a statute that has you paying social security (i.e. "cotisations" for retirement and health care), you shouldn't have to pay US social security and self-employment tax. You're considered to be an "employee" of your company.
Cheers,
Bev

 

[slm19]

Check Publication 54 on the IRS website, but when last I checked (a few years ago before the auto-entrepreneur thing came into being) there was something in there specifically related to this sort of thing. As long as your business is registered in France under a statute that has you paying social security (i.e. "cotisations" for retirement and health care), you shouldn't have to pay US social security and self-employment tax. You're considered to be an "employee" of your company.
Cheers,
Bev

Thank you! You have been very helpful!