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Taxes for freelancers and self-employed workers in France

Updated: 2 days ago


Table of Contents


  1. Introduction

  2. France's System of Taxes for the Self-Employed

  3. Self-Employment Taxation in France

  4. Taxation for Different Business Structures

  5. Registering for Freelance Tax in France

  6. Tax Benefits and Deductions

  7. Corporate Tax

  8. Filing Taxes

  9. Value-Added Tax (VAT)

  10. Social Security for Self-Employed Workers

  11. Penalties for Late Tax Filing

  12. Associations for Businesspeople in France

  13. Finding a Financial Adviser

  14. Useful Resources


Learn about tax obligations for freelancers and self-employed workers in France. Understand rates, deductions, and filing requirements.


Introduction


Understanding French tax legislation is crucial for every business owner in France. This guide will help you navigate the complex tax landscape, ensuring you know how much to set aside each year and how to make the most of the available tax breaks.


France's System of Taxes for the Self-Employed

Income Tax

Freelancers in France must pay income tax and contribute to the social security system. The tax rate depends on your business structure and income.


Social Security Contributions

Social security contributions are mandatory and are calculated based on your income. The rates vary depending on your business type and earnings.


Self-Employment Taxation in France


Standard Tax System

If you register as an "enterprise individuelle," you and your business are taxed as a single entity. The income tax brackets for 2022 are:

  • €10,225 to €26,070: 11%

  • €26,071 to €74,545: 30%

  • €74,546 to €160,364: 41%

  • Above €160,364: 45%


Micro-Enterprise Tax Regime

The micro-enterprise regime offers simplified taxation:

  • Tax credits vary by company type.

  • Firms must qualify as commercial sales entities with annual sales below €172,600.

  • Specific tax credits reduce the taxable base significantly.


Taxation for Different Business Structures


Tax for Partnerships

For SARLs, personal income tax may apply for the first five years. After that, corporate tax is applicable unless you qualify for special statuses.


Tax for Limited Companies

EIRLs might pay income tax via personal tax returns. Otherwise, corporate tax applies:

  • Standard corporate tax rate in 2022: 25%

  • Reduced rate of 15% for companies with sales under €38,120.


Registering for Freelance Tax in France


To legally operate, you must register with the CFE, the Bureau of Business and Professions. Micro-enterprises can register online.


Tax Benefits and Deductions


Under the standard regime, you can deduct business expenses like office rent and equipment costs. For micro-enterprises, predefined credits apply.


Key Deductions:

  • Expenses must be necessary for business operations.

  • Proper invoices and documentation are required.

  • Home office expenses can be partially deductible.


Corporate Tax

Recent reforms have lowered the corporate tax rate:

  • Standard rate: 25%

  • Reduced rate: 15% for small enterprises


Tax Credits:

  • Research and development credits

  • New business credits


Filing Taxes


Filing Deadlines:

  • Individual taxpayers: May 19 (mail) or between May 25 and June 7 (online)

  • Corporate taxpayers: April 30 or three months after the fiscal year-end


Value-Added Tax (VAT)


VAT Rates:

  • Standard rate: 20%

  • Reduced rates: 10%, 5.5%, and 2.1%


Exemptions:

  • Service businesses with annual sales under €34,600

  • Commercial businesses with sales under €86,900


Social Security for Self-Employed Workers


Monthly or quarterly contributions are required. The rate depends on your business structure and income.


Contribution Rates:

  • 6% to 22% for micro-enterprises

  • Reductions available for the first year


Penalties for Late Tax Filing


Penalties:

  • 10% of the total tax due for late returns

  • Additional interest and penalties for payments delayed beyond 45 days


Associations for Businesspeople in France


Notable Associations:

  • Citizen Entrepreneurs

  • Femmes Entrepreneurs

  • Second Souffle


Finding a Financial Adviser


A competent accountant can help you navigate tax requirements. Look for French-speaking experts in your region.


Useful Resources



Filing taxes in France can be complex, but understanding the process and seeking professional advice can help you stay compliant and optimize your tax situation.




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