Covid-19 France: Aid for self-employed
Sole traders and other small businesses in France are likely to be especially hard-hit by the current disruptions due to Covid-19.
State aid is available together with a range of other sources of help.
Salaried workers who have to stay at home and are not able to work at a distance via télétravail are able to benefit from a state-funded system of chômage partiel (temporary unemployment), giving them 84% of their net normal salary.
Formerly compensation was up to the level of the Smic minimum wage, but currently the state aid is up to 4.5 times this amount, or €5,330 net/month.
The solution for sole traders and other small businesses no longer able to continue work in certain sectors is a fonds de solidarité, a fund being set aside by both central government and the regional councils. This will be used in the first instance to help small businesses face up to a sudden drop in turnover linked to the pandemic.
If necessary, further funds may later be made available to firms needing it to stave off bankruptcy.
Initially the aid will be worth up to €1,500 accessed by applying to the DGFiP (central government tax department) from April 1. The scheme is open to independent businesses (not those which are part of a big group) with fewer than 10 employees whatever their legal set-up (eg. whether micro-entreprise, regime réel or a société, and for the various sectors, artisans, commercial firms, liberal professions etc).
The firm should have had turnover in 2019 of under €1million and taxable profit of under €60,000. (The official tax website, impots.gouv.fr, states that if the firm did not exist on March 1, 2019 then it should have had an average monthly turnover under €83,333 between its start date and March 1, 2020).
The latest advice from the Economy Ministry and the French regional councils on March 25 says the aid is available to businesses which have been forced to close to the public due to Covid-19 OR which had turnover in March 2020 that was less than 70% of the turnover in March 2019. The aid will be equal to the loss, capped at €1,500.
Firms that started business after March 2019 should look at the average monthly turnover between creation and March 1, 2020, to see if the 70% drop applies.
This is to help firms face up to the sudden drop in turnover. In a second round of funding a further amount of €2,000 will be available from the regional councils, to firms meeting the same criteria, with at least one employee, and which are in danger of bankruptcy. This could be because they cannot pay bills falling due within 30 days and their bank refuses a 'reasonable' loan to help.
From April 15 each regional council will open an online portal where businesses can apply for assistance (check the website of the council). The money will be paid by the DGFiP.
Connexion notes that information on the impots.gouv.fr site refers to slightly different criteria for eligibility, including that if not forced to close to the public but has suffered the reduced turnover, the firm should be in one of certain designated sectors: accommodation, serving food, cultural and sporting activities, events, business fairs, transport or warehousing.
This is not mentioned on the March 25 document, which says all firms meeting the criteria (detailed above) will receive assistance. It further notes that the amount of aid is not declarable for tax.
The application form is available since the beginning of April via your personal space on the official tax website (https://www.impots.gouv.fr/portail/).
Information required will include: Siren/Siret number, bank RIB, turnover, how much aid is requested, and a signed declaration on honour that the information provided is correct.
If not covered by the fonds de solidarité, the Caisse des Allocations Familiales (Caf) says on its coronavirus Q and A page that independent workers or micro-entrepreneurs temporarily without employment or work can apply for the RSA (revenu de solidarité active) via its website site caf.fr/
This is a benefit which guarantees a minimum income, €560 for a single person and then more depending on family make-up. For example a couple with one child would be eligible for €1,008/month.
If you are self-employed and are paying regular estimated income tax instalments from your bank account based on previous earnings, you can change the amount you pay by altering the amount of estimated annual income, which will automatically adjust your monthly payment. You may also postpone your next instalment if you wish. This has to be undertaken before the 22nd of the month to be taken into account for the following month.
If you wish to put off a monthly payment to the following month you can do this three times a year if necessary but just once a year if making three-monthly payments.
It is possible to temporarily cancel an instalment but it will still require payment when finances allow.
Changes can be made online at impots.gouv.fr in your personal account under Gérer mon prélèvement à la source. There is also a form available to request delaying a tax bill for three months (notably for impôt sur les sociétés – corporation tax – or for the CFE and CVAE professional taxes), or, in exceptional circumstances to ask for a tax bill to be cancelled. Visit https://tinyurl.com/tt9tus4
If you are asking to be let off payment of a tax you will need to provide full details of your financial situation including lowering of turnover, other debits, funds available to you etc. VAT is payable as normal.
Coronavirus income tax information can be found (in French) at: https://tinyurl.com/trneak3
There are arrangements in place to help with social security cotisations, both for firms making payments for their workers’ and also for the self-employed paying their own cotisations.
Firms can opt to pay less or even nothing on a temporary basis although the payments will have to be made at some point (firms can delay payments for up to three months).
For self-employed people on the réel tax set-up paying cotisations on March 20, this payment will be spread out over April to December. If paying on April 5, the next instalment will not be debited, but will be spread over May to December. Where appropriate additional payment delays and/or to have instalments readjusted to take account of lowered income (based on current estimates) can be requested via Urssaf.
Artisans and those undertaking commercial work can apply online, secu-independants.fr/ in their personal account, by email at this link by selecting Vos cotisations and Difficultés de paiement, or by telephone on 3698 (standard call cost).
Those in the liberal professions use urssaf.fr by sending a message from their personal space choosing Une formalité declarative and Déclarer une situation exceptionnelle, by calling 3957 (12 centimes/minute plus call cost) or 0806 804 209 (standard call cost) for those in medical professions.
For micro-entrepreneurs if paying by monthly instalments and March 31 is the next due date, the amount of turnover can be reduced, down to zero if appropriate, to reduce the corresponding cotisation payment.
This is undertaken via their account at autoentrepreneur.urssaf.fr by sending a message via Messagerie > Nouveau Message > Gestion de mon auto-entreprise > Je rencontre des difficultés de paiement.
If paying three-monthly and April 30 is the next due instalment date, further information will be provided in due course.
You can find regularly updated information on Urssaf payments here: https://tinyurl.com/rrdqzjs
Grant for self-employed people from Sécurité Sociale Indépendants
A special Aide Financière Exceptionelle Covid-19 has been set up for any independent worker, including micro-entrepreneurs whose business has been affected by the confinement restrictions. An application form to request help in paying social security cotisations or for a one-off grant can be downloaded here: https://tinyurl.com/w8ydgh7.
Water, electricity, gas bills
You can ask for payment to be delayed but only for professional premises and not for your home, for example if you have a shop. You have to contact each service yourself and make the request.
Professional bank loans
All banks have been asked to allow businesses to suspend their loan payments for 6 months, with no penalties. Contact your bank direct.
Where appropriate you can ask a mediator to negotiate with your bank to reschedule any payments due. 105 mediators have been set up throughout the country, you can contact them here: https://tinyurl.com/r8z6acd
You can also ask for a State guaranteed loan, PGE (Prêt garanti par l’Etat) to help you survive this period. All businesses including micro-entrepreneurs can apply. You will not have to make any payments during the first year. You contact your bank which will analyse the dossier and if approved it will be sent to BPIFrance, the public investment bank for certification that you are eligible for the loan. Requests can be made up to December 31, 2020.
Inability to work because you are at high risk from Covid-19 or you are a parent who has to look after children under 16
You have to notify the Health Insurance online site at declare.ameli.fr if you are looking after children. You will then receive a daily payment, indemnité journalière calculated according to your income which will compensate in part for your loss of earnings. You will only be eligible if you are now affiliated to Cpam. If you are still affiliated to the CIPAV (applicable to certain kinds of work in the liberal professions) you are not eligible.
Most micro-entrepeneurs' health insurance was automatically transferred to Cpam earlier this year.
You also make your declaration via declare.ameli.fr if you have stopped work because you are a person at risk which includes pregnant women and those with heart or respiratory conditions, high blood pressure, diabetes etc.
For further help
You can find useful information on the Fédération Nationale des Autoentrepreneurs et Microentrepeneurs website federation-auto-entrepreneur.fr. The Federation is in contact with the government aiming for better rights for micro-entrepeneurs in general as well as during the Coronavirus period.
Sign up to our free weekly e-newsletter
Subscribe to access all our online articles and receive our printed monthly newspaper The Connexion at your home. News analysis, features and practical help for English-speakers in France