• France's news in English
 

France 'drops limits' on auto-entrepreneurs

Published: 13 Aug 2013 13:03 GMT+02:00

The French government had announced contentious plans in June to cut the current earning limits on the country's self-employed, or auto-entrepreneurs as they are called.

The revenue ceiling for auto-entrepreneur (AE) "artisans" was to be cut from from €32,600 to €19,000 and for AE "traders" from €81,500 to €47,100. 

The move sparked uproar from auto-entrepreneurs who claimed they would be forced to ditch the popular and simple business model. It appears their voices have been heard.

A document seen by French financial daily Les Echos suggests that France’s 893,000 registered auto-entrepreneurs, including thousands of ex-pats, will in the end, not be subject to the reduced earning limits.

The French cabinet is set to debate the bill later this month, but Les Echos, which claims to have seen a copy of the bill, says all mention of the reduced limits has been deleted from the text.

"This would be great news for auto-antrepreneurs," Nice-based consultant Andy Dennison, who runs the website MonAmiAndy.com told The Local.

"This would have pushed a lot of people off the scheme and forced them to set up a limited company."

SEE ALSO: The pitfalls of France’s auto-entrepreneur system.

Since 2009, around one million people are believed to have signed up to the auto-entrepreneur status that was launched by former president Nicolas Sarkozy.

It offers the self-employed an easy way to set up their own business and allows them to pay social charges as they earn rather than upfront.

It is appreciated by thousands of expats because it is relatively free of burdensome red tape.

Critics of the legislation claimed that although the decreased limits would have affected 11 percent of AEs, they would have dissuaded many people from signing up to it and effectively brought about its demise.

In May, The Local reported how a group called “The Chicks” set up an online movement to fight the proposed reforms.

“We cannot and we must not accept the denial of social democracy that would lead to the destruction of our businesses, jobs and the growth of entrepreneurship in France,” read a statement on the website.

Government coffers could have lost money

Dennison believes the government may have ended up losing out anyway because auto-entrepreneurs may have been inclined not to declare their total revenue.

"A lot of people would have felt forced to under-declare. People who have done everything by the book would suddenly have been told they cannot earn more than €19,000. That would have had a knock-on effect on France's social security system, which already has a gaping black hole. "

The new Socialist government wanted to introduce changes to the AE system to crack down on those abusing a system that was originally designed to help those who wanted to work more and earn a second income.

President François Hollande launched a project in the spring to gather expert testimony on tradespeople and small businesses, with a view to legislating this autumn.

Trades Minister Slyvia Pinel isset to present the reform bill to cabinet on August 21st, with the proposals coming into law in September if they pass through parliament.

Setting up a limited company has its bonuses

The proposed changes were made despite a report commissioned by the government that called for ministers to maintain the simplicity of the AE scheme.The government believes the system puts regular tradespeople at a disadvantage because auto-entrepreneurs pay less social charges.

Companies often prefer to commission auto-entrepreneurs over regular, established employees, because they will incur less costs.

Once auto-entrepreneurs go above the limit they have to set up their own limited company, which has both benefits and disadvantages, as Dennison points out.

"One of the good things about a limited company known as a SARL, is that they can run at a loss if that's ok for you. Banks and businesses are also more likely to trust SARLs than auto-entrepreneurs, which means it is easier to get a loan, and so on.

"There are, however, more costs involved and you need to make sure that you will earn a certain amount to cover those costs. You need clear objectives each year. 

"If you have that and you can reach them, then a SARL is more beneficial in the long run."

Dan MacGuill (dan.macguill@thelocal.com)

Your comments about this article

Today's headlines
Three dead after French Alps avalanche
A group of tourists has been swept away by an avalanche in the French Alps. File Photo: AFP

Three dead after French Alps avalanche

UPDATED: Three people were killed and several were injured in a massive avalanche that hit the French Alps on Wednesday afternoon. READ  

French schools scandal
Scandal of paedophile teachers shocks France
Photo: AFP

Scandal of paedophile teachers shocks France

France’s education minister promised a thorough investigation on Wednesday into "systematic failures” after it emerged that numerous teachers were employed to work in schools despite having previous convictions for paedophilia. READ  

Smoking in Paris
Paris gets tough on café terrace smokers

Paris gets tough on café terrace smokers

As Parisians continue to ignore laws that ban smoking inside closed off cafe terraces, the Town Hall has sent a reminder to police that they shouldn't hesitate to crack down on both the smokers and the cafe owners not abiding by the rules. READ  

Young French women turn to 'le binge drinking'
Binge drinking is becoming all the more common in France. Photo: Shutterstock

Young French women turn to 'le binge drinking'

More and more young French people are turning to binge-drinking, especially teenage girls, as the Anglo Saxon habit continues to be adopted by the youth of France. The country's health minister has vowed to tackle the issue. READ  

Drone porn!? The best April Fools from France
The departure board in Lille. Photo: SylvieBRawlings/Twitter

Drone porn!? The best April Fools from France

France joined in on the fun of April Fools' on Wednesday, with everything from news about giraffe yoghurt to train journeys to Sydney from northern France. Here's a selection of our favourites from France and the rest of The Local Europe. READ  

France set to keep ban on gay men giving blood
Photo: Donate.

France set to keep ban on gay men giving blood

France's national ethics committee has recommended that the country upholds the lifetime ban on gay men donating blood, stating that more research is needed before any changes are made to the law. Gay rights groups have reacted furiously. READ  

Alps plane crash video 'must' be given to police
A video has reportedly emerged showing the final moments of the doomed Germanwings flight. Archive Photo: AFP

Alps plane crash video 'must' be given to police

Prosecutors investigating the crash of a Germanwings plane in the French Alps have demanded that a video purportedly showing the final moments of the flight inside the cabin must be handed over to investigators. READ  

No charges for Sarkozy in campaign finance case
Nicolas Sarkozy seen here alongside Jean-Francois Copé who is also implicated in the campaign funding scandal. Photo: AFP

No charges for Sarkozy in campaign finance case

French judges decided on Wednesday not to charge Nicolas Sarkozy over a campaign finance scandal but placed the former president under a special status that leaves the door open for further questioning. READ  

Two babies die in France after vaccinations
Concern in France over vaccinations for gastroenteritis. Photo: AFP

Two babies die in France after vaccinations

Health authorities in France are reviewing whether a common vaccine to prevent stomach illnesses should be given to babies, after it emerged this week that two newborns died following the inoculations. READ  

April Fools!
Paris bistros crack down on loud-mouthed tourists
One of the new campaign posters in a cafe in the 10th arrondissement.

Paris bistros crack down on loud-mouthed tourists

Numerous cafes and bistros across the City of Light have signed up to a provocative campaign aimed at cracking down on loud-mouthed foreign tourists, claiming they're ruining "the sophistication of the Paris dining experience". READ  

RECEIVE OUR NEWSLETTER AND ALERTS
France's 'winter truce' has been called off, but what exactly is it?
National
April Fool's: Trains to Sydney, drone porn, noisy tourist bans...
National
What's on in France: Ten things to do in April
National
Paris bistros crack down on loud tourists. Surely it's an April Fools
National
The key reforms of France's healthcare bill
National
Here's the place to get the best baguettes in Paris
More French pensioners head abroad to settle
Is it possible to make the most of fine food in Paris on a student budget?
Travel
Everything (well 12 things) you didn't know about the Eiffel Tower
Who were the winners and losers in France's local elections?
Can the 'nightmare' of a pilot downing a plane be prevented?
National
Paris: France mulls lifting ban on casinos
Does low cost mean low safety? Questions after Germanwings crash
Gallery
IN PICTURES: A timeline of the Alps plane crash
National
Where in La Belle France do British expats avoid?
National
IN PICTURES: 'Tide of the century' draws tens of thousands
National
Paris ends smog-fighting restrictions as the air finally clears
National
The main mistakes made by French property buyers
National
International French Language day: But what does the future hold?
National
IN PICTURES: What went on behind the clouds during Friday's eclipse
National
French food porn: What is the Gallic grub that goes viral the most?
Culture
France treated to rare Northern Lights show
Politics
Shady candidates undermine French far-right's election bid once again
Politics
French minister takes a swipe at overuse of Franglais in workplace
French gastronomy set for global charm offensive
French newspaper stuns readers with porn film pics on front page
Sport
The reasons why Zlatan Ibrahimovic might really think France is s**t
National
France could soon ban skinny models from catwalks
Health
Is France's much-envied health care system under threat?
National
There are jobs in France where you don't need to speak French
National
New plan to improve life in rural France drawn up
Education
Paris universities on the up in new rankings
Sport
We meet one of the most entertaining footballers in France
National
New plan to improve life in rural France drawn up
Features
Forget Paris. Is Bordeaux the best place to live in France?
Travel
Runaway plane mows down skier on the slopes of French Alps
Society
Friday 13th: A look at France's superstitions
Culture
France is ready to end its stubborn resistance to the English language
Features
'Hedgehog' and other words that French people simply can't say
Society
The worst 'nightmares' of living in France (written by a Frenchman)
Health
French hospitals crisis: 'It's like the UK under Margaret Thatcher'
Sponsored Article
Expert US tax preparation for Americans in France
VIDEO: Footage emerges of the moment two helicopters collided
Gallery
IN PICTURES: Helicopter crash kills 10, including French sports stars
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se