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In order to maintain micro-enterprise status, one of the conditions is not to exceed a certain turnover threshold, which depends on the activity being carried out. These ceilings have been reassessed since January 2023. What are the new thresholds? What happens in transit? What are the other major new features for Sole Proprietorships (formerly Automotive Entrepreneurs)?
Written by Sandra Grace | Posted on 02/14/23 at 11:52
What are the new turnover ceilings?
Turnover corresponds to the sum of all cash inflows related to the small business activity.
In 2023, the annual turnover cap for the business under the sole proprietorship status is:
- € 188,700 for the purchase/resale of goods, accommodation services and the sale of foodstuffs to be consumed on site;
- 77,700 euros for commercial services, crafts and free activities.
- 188,700 euros for a mixed activity (sales and services), including 77,700 euros in services.
Up to a certain threshold, the individual entrepreneur is exempted from VAT. Therefore, he does not charge value added tax to his clients, which simplifies his accounting management. These thresholds were also reassessed in January 2023:
- €91,900 for the purchase/resale of goods, accommodation services and the sale of foodstuffs to be consumed on site;
- 36,800 euros for commercial and craft services and free activities;
- 91,900 euros for a mixed activity (sales and services), including 36,800 euros in services.
the Sole Proprietorship Case Benefit from simplified administrative obligations (tax, accounting and social).
What happens if a turnover threshold is exceeded?
If the business turnover threshold is exceeded for only one year, the company remains under the status of small enterprise.
If this happens for two consecutive years, the company changes its tax regime, which varies according to activity and earnings. Thus, industrial and commercial profits (BIC) are subject to the simplified real system or the normal real system. Non-commercial earnings (BNC) is subject to a controlled advertising regime. The Federal National Council is concerned only with liberal activities.
Exceeding the turnover cap also means new management and accounting obligations (maintaining annual accounts, annual inventory, increasing social security contributions, etc.).
if I were Auto businessman And you have exceeded the VAT exemption cap, you must request a VAT number on the online tax platform, via your professional area. You will then have to charge your customers VAT. It is then necessary to declare the VAT collected to the state and then pay it. You can recover VAT on your business purchases, if applicable.
What else is new for individual companies?
tax and social measures
In order to take inflation into account, the Finance Act of 2023 adjusts the upward scale brackets for income tax. Thus, admission to each of them is increased by 5.4%.
Social contribution rates for microenterprises have also been revised downward since October 2022:
- 12.3% for the activities of buying and selling goods;
- 21.2% for trade or craft services;
- 21.1% for other services and liberal professions belonging to the general system for their retirement;
- 21.2% for Cipav’s affiliated liberal activities.
The Social Security Cap (PASS) sets the cap used to calculate the maximum daily allowance paid in the course of sick leave, an accident at work, or even maternity and paternity leave. Increases in the minimum wage (by 1.8% compared to 2022) and the PASS (by 6.9%) have increased these daily allowances, including for the self-employed.
An interest-free loan for the purchase of a low emission vehicle
1 agoany January 2023 All individuals as well as small businesses located in low emission zones can take advantage of an interest-free loan to purchase a low-pollution vehicle (electric or hybrid). This measure is valid for two years.
The loan can be up to 30 thousand euros, and it will be repaid in seven years. For this, your tax reference income must be less than or equal to €14,000. The acquisition cost of the vehicle must be less than or equal to €45,000 for the car, and €60,000 for the truck.
Publish date: 02/14/2023
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