By Roger Haigh
Recently there have been several changes, including changes in income thresholds and VAT levels for businesses and microentrepreneurs. If you are a micro-entrepreneur and would like to know more click on this link.
Previously known as the auto-entrepreneur, the micro-entrepreneur is an individual entrepreneur subject to a simplified tax and social security system. This allows them to carry out a small independent professional activity very easily, generating a turnover below a certain threshold. This regime can be used to carry out a regular or occasional activity, on a principal or accessory basis, and allows perfect control of the resulting social charges.
As every 3 years, the turnover ceilings for auto-entrepreneurs have been increased. Defined by the 2023 finance law, these new thresholds are applicable for the years 2023, 2024 and 2025. They are:
• €188,700 (previously €176,200) for the sale of goods, objects, supplies and foodstuffs to be taken away or consumed on the premises;
• € 188,700 (previously €176,200) for the provision of accommodation: hotels, guest rooms and furnished tourist accommodation;
• € 77,700 (previously €72,600) for craft and commercial services;
• € 77,700 (previously €72,600) for liberal professions attached to the SSI (Sécurité Sociale des Indépendants – ex-RSI ) and Cipav (Caisse Interprofessionelle des Professions Libérales).
The new VAT thresholds are:
- 36,800 € and 91,900 € for the basic threshold (compared to 34,400 € and 85,800 € previously);
- 39,100 and €101,000 for the higher threshold (compared to €36,500 and €94,300 previously).
As a reminder, a self-employed person benefits from the franchise based on VAT if he does not exceed the first threshold. This means that he does not invoice his customers for it and is therefore not concerned by VAT declarations.
If its annual turnover is between the deductible threshold and the tolerance threshold for two consecutive years, the microentrepreneur becomes liable for VAT from 1 January of the following year. If its annual turnover exceeds the tolerance threshold, it becomes liable for VAT from the first day of the month in which it is exceeded.