Auto-entrepreneur 2022: Urssaf and ceiling

The auto-entrepreneur status allows you to exercise an independent activity with few administrative restrictions. This condition is subject to several conditions. The reduction of contributions is planned for the second half of 2022.

from January 1, 2009the auto-entrepreneur scheme allows all that start your independent business. Administrative and accounting management is greatly simplified, which attracts many people with different profiles. Auto-entrepreneurs depend on the micro-enterprise tax regime. A regime with streamlined formalities subject to respecting a certain turnover ceiling. This scheme allows you to have a one-time or full-time activity independently without the administrative constraints of a company.

The self-employed person must paying a contribution to the Urssaf monthly or quarterly. The calculation of contributions is based on turnover. It is also associated with a rate that depends on the activity performed:

  • For purchase, resale or accommodation: the applicable rate is 12.8% of turnover
  • For the provision of craft or commercial services and the use of unregulated liberal professions: 22% of the turnover
  • For liberal activities covered by Cipav under old age insurance: 22.2% of turnover

Added to this are:

  • The contribution of vocational training (CFP): rate of 0.1% for the general case, 0.2% for liberal professions covered by Cipav under old age insurance and 0.3% for services to the craft
  • Paying income tax : rate 1%, 1.7% hope 2.2% according to the situation

from January 1, 2020all auto-entrepreneurs depend on the general social security system that currently administers the social security of the self-employed.

In addition, in her general policy speech at the National Assembly on July 6, 2022, Prime Minister Elisabeth Borne announced the reduction of social security contributions for the self-employed. This is part of the bill in favor of purchasing power, which will be reviewed by the Parliament in July 2022. In detail, it contains a reduction in sickness and maternity contributions for the self-employed when their annual income does not exceed of the minimum wage, ie 15,632 euros (equivalent to 1,645.58 euros gross or 1,302.64 euros net per month). According to the government, this should allow beneficiaries to save 550 euros per year. The explanatory memorandum of the bill specifies that it should concern artisans, traders, all liberal professions as well as heads of farms or agricultural businesses and micro-entrepreneurs, “ie 2.25 million people estimated”. This decline is expected to be sustainable.

Do auto-entrepreneurs pay VAT?

The auto-entrepreneur benefits froman exemption from VAT as long as a certain turnover threshold is not exceeded:

  • €34,400 for the provision of services with a tolerance threshold of 36,500 euros in the first year of excess
  • €85,800 for sales activities with a tolerance threshold of 94,300 euros in the first year of excess.

Do the self-employed pay taxes?

Self-employed people must pay income tax in their turnover even about industrial and commercial benefits (BIC) or non-commercial benefits (BNC) according to their field of activity. The declaration is made together with the payment of Urssaf contributions, either monthly or quarterly. Regarding the discharge payment, the rates are:

  • 1% for the sale or supply of accommodation
  • 1.7% for the provision of services
  • 2.2% for non-commercial benefits.

If they exceed the income ceilings, auto-entrepreneurs are needed will be taxed in the actual regime. In addition, under its principles, they have the possibility ofselect the actual tax regime. In these cases, the option must be chosen no later than the last day for filing the tax declaration on the results of the fiscal year, ie in May or June of the following year.

Is it possible to combine the status of auto-entrepreneur and employee?

It’s possible combine the status of auto-entrepreneur and a salaried activity. This entrepreneurial activity can be carried out simultaneously with paid activity or during an unpaid leave dedicated to the creation of a business. In order to carry out this business activity, certain conditions must be followed.

  1. The activity must not compete with that of the employer
  2. The employment contract does not prohibit the performance of a self-employed activity
  3. Adhere to the rules of non-competition and fairness as may be stipulated in the contract

Threshold: what is the ceiling of resources that cannot be exceeded for a self-employed person?

Auto-entrepreneurs should not does not exceed a certain resource limit if they don’t want to transfer to sole proprietorship status. The 2022 resource ceiling (compared to 2021 income) is:

  • €176,200 for the activities of providing trade and accommodation
  • €72,600 for the provision of services and the liberal professions

However, there is a tolerance in case of overrun by one year.

Can auto-entrepreneurs still benefit from the ACRE (formerly ACCRE) scheme?

The aid for the creation or acquisition of a business (ACRE and previously ACCRE) is a French system that automatically pays car dealers to promote the creation of a micro-enterprise. As of the decree of November 22, 2019, ACRE will no longer be automatically paid and its benefit will be reduced to 1 year only instead of the 3 years in force until then. Now, it is necessary to fulfill one of these conditions benefit from ACRE.

  • Payable by Pôle Emploi
  • Be a non-compensated jobseeker registered on the jobseeker’s list for more than 6 months in the last 18 months
  • Receiving the return-to-work assistance allowance (ARE) or the professional security allowance (ASP)
  • Receive the specific solidarity allowance (ASS) or the RSA
  • Be between 18 and 25 years old
  • Under 30 years old without payment or recognized as disabled
  • Create a company located in a sensitive urban area (ZUS)

The great improvement in this new condition lies in the simplifying the manufacturing process. In fact, to become a self-entrepreneur, a simple online registration is enough. To participate in this scheme, the creator of a new activity must go to:

Once registered, INSEE communicates with the new auto-entrepreneur his Siret number. Artisans, traders and liberals covered by CIPAV (Interprofessional Provident and Old Age Insurance Fund) are subject to the self-employment method when their turnover remains below a certain ceiling.

from 2016the auto-entrepreneur must register your trading company and register companies. He should too paying business property taxes (CFE), which makes the system less useful and more complex at the administrative level. There are many auto-traders who do not exercise any activity (they already have the same trade) but pay high costs.

Based on the taxes established under 2015auto-enterprises are now required to payment of CFE. However, auto-entrepreneurs who conduct an activity in the field of fishing and farming are permanently exempt from CFE. It is the same with painters, sculptors, sculptors, draftsmen, photographers, authors, composers, lyricists and dramatic artists.

from 2018there is an exemption from business property tax for micro-enterprises that declare an annual turnover under 5,000 euros. In addition, new companies are not subject to CFE in the year of their creation, regardless of the opening date of the first fiscal year. The list of all exempt companies can be found in articles 1449 to 1466F of the General Tax Code.

The auto-entrepreneur must make a declaration to the CFE before January 1 in the year following the creation of the company, through the appropriate form. No annual declaration shall be made thereafter, unless there is a change likely to alter the amount of the contribution. You must file a 1447-M declaration before the 2nd working day after May 1st.

What is the Kbis extract of a self-employed person?

Auto-entrepreneurs who exercise a commercial activity receive their Kbis extract by post after their declaration. The receipt of this document confirms the the legal existence of their activity. Auto-entrepreneurs who carry out a non-commercial activity (especially all the so-called intellectual activities) do not need a Kbis extract to carry out their activity. Auto-entrepreneurs who conduct a craft activity receive another document called taking D1.

To be paid, auto-entrepreneurs must change invoices for their customers. These invoices include the name and address of the customer, the SIRET number of the self-employed person, the unit price and the total price requested as well as the payment deadline. Subject to compliance with the ceilings, the invoice does not include VAT. It is possible to use this invoice template for the auto-entrepreneur.

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