Auto-entrepreneur: Deadline to switch
Certain small businesses have until March 31 to swap to a new simplified tax and social charges regime.
THE deadline for businesses to swap to a new simplified tax and social charge regime, linked to the auto-entrepreneur status which begins next year, has been set as March 31.
The auto-entrepreneur status begins on January 1.
It features easier ways of starting and closing a business as well as simplified tax and social charge payment methods. Existing businesses can change their current tax and social charge methods to receive the same benefits.
If you already have a business, you cannot de-register and start again but certain types can swap to the régime micro-social and régime micro-fiscal offered to auto-entrepreneurs.
Under the régime micro-social, charges are fixed at 12% of turnover for commerce, 18.3% for professionals and 21.3% for services. You can pay monthly or quarterly, based on earnings.
You can also choose the option of the régime micro-fiscal which relates to income tax.
Here, you declare turnover monthly or quarterly and pay a percentage in tax - 1% for selling goods or providing accommodation, 1.7% for services and 2.2% for professions.
To swap you will need to be registered for the existing micro-entreprise fiscal regime, not any of the regime réel set-ups. This means you cannot charge VAT and you must have a turnover below €80,000 for a commerce and €32,000 for services and professions. If you are currently taxable under a regime réel you can change if you have been below the threshold for two years by telling your tax office by recorded delivery.
To change to the new methods you need to write to your caisse RSI (main social charges body) and tax office.
Brittany-based accountant Joanna Reintjes, of Account Revision, said the government was keen to promote the new methods to those doing part-time work to supplement employment or pensions but that they were suitable for others as well.
She said: “It will benefit people who would prefer to pay as they go. The system is straightforward - if you earn nothing from your business, you pay nothing.
“As for the amounts you will pay, if you bank about €5,000-€15,000 you will probably be better-off, but if you are near the turnover limit you may pay slightly more. It will vary case by case.”
