AE changes!

Thanks again, Tracy. I will look into it.

My business is completely unpredictable because I am not out there selling on a daily, weekly, or even monthly basis. I am pretty specialised and can go six months or more without finding something of interest and real value. Its like waiting for buses ! I can wait for a further six months to get it sold in the right place. Therefore the Pay as you Earn nature of the AE is a god send to me.

Agree with your points about offsetting costs against profit, though. Thats how it worked for me in the UK. However, I have had to change the way I buy and sell under the AE because CA is everything - in other words, concentrate on higher profit items - and now I am used to it.. and its more interesting !

Thanks again for all your helpful answers.

Not really, it has been trial and error, I work in tourism so it also very volatile plus seasonal.

Have spent many hours at the Chamber de Metiers and the CCI who couldn't decide if I was service or service des artisanat??? visited the Hotel des Impots for info about TVA (the easiest part) and now have accountant who deals with RSI/URSSAF so that has helped a lot. The accountant is expensive - about 270€ a month (TTC) but does all my accounts every month, including all the inputting and does the TVA declaration.

Also know many EI who feel the same but think the problem stems that there is jealousy of the easier start you have with an AE and the illusion that AE's pay less in insurance and cotisations.

As EI paying all the cotisations, whether you have income or not at the beginning is a nightmare but if you have had 3 years to trial your business as AE you should know if it is going to work. Being able to offset costs against my profit is amazing and although I am on line to have same CA this year as last, I won't show hardly any profit so should not have to pay much in social charges - which are 43% of profit and the cause of all the gripes. Remember CA are everything in France, not profit.

Yes a compromise rarely pleases both sides. I have been on the scheme since 2010 and expected them to effectively move me on by bringing in a time limit and/or limiting it to a secondary activity. So from that point of view, I am delighted to see it survive. Nevertheless, the lower 'seuils' will effectively mean a 2 year time limit for some people, who are already turning over more than the new thresholds. So it is , on reflection, quite a clever compromise by the government. It is effectively a time limit, if you are seeking to grow your business and not stay small. My business, which is antiques, is very volatile and irregular in the way the income rolls in, so I could conceivably exceed the threshold one year, but comfortably underperform the next, thereby not triggering the change to another regime.

However, your comments on the EI regime are very interesting. Perhaps I am too fearful of the alternatives to AE because the people I know, who operate as Micro-Entreprises, would much prefer to be AE's. Is there a good source of information on EI you can point me to ?

It seems that this is more or less the final decision, the decret should be published in September which will be the actual law. Reading the French press it seems that this turnabout has displeased the AE's and the building trade, so no one has won.

I registered as AE at the end of 2009 but did nothing until 2010 alongside my part time job. 2010, I dabbled, 2011 did well so in 2012 went full time self employed and exceeded the limits. This year I have left AE (no choice) and registered as EI and am astounded how much less I am paying on the forfait system. I know this will go up but am confident that by the third year I will have no trouble paying the increased charges as in actuality I have had 5 years to get up and running - perfect.

AE has been amazing for me (and my husband in the building trade) as I would never have started a business otherwise and I am so pleased that the govt has not abolished it altogether.

Having read the 'les echos' link, it really does seem that this is it for now ! I imagine the reality of the consequences of suppressing the AE hit home in the end, but placating the syndicats and artisans' associations may not be easy for Pinel after all the pronouncements by her and other ministers in the run up to this decision.

Thanks very much for that, Tracy.

Are these THE changes as a result of the government inquiry into the AE regime ? in other words, is the AE safe for the foreseeable future ? I had thought that time limits were almost certainly going to be introduced, reading what the minister has said before.

If this is the sum of the changes, I am relieved and amazed at the volte face by the government.

Details in English from Valerie 'Start a Business in France'

I've just registered as a services AE as I intend to start doing a bit of Business Consultancy/light web development work again after La Rentree. It looks like the change is that if a service provider exceeds 19,000 euro for 2 years in a row then the AE will be converted to the classical regime. So where before an AE service provider could bill for 32,600 euro per annum now that is limited to 19,000. If you exceed this for 2 years in a row then they will convert you.

I only intend to do about 5 hours a week so I'd have to be extremely well paid to exceed that...phew!

Thank you Tracy. I was also trying to decipher the 'official memo' with the help of Google translate. From what I can see, if I stay below the 19k threshold (easy peasy - I earn about a 10th of that) then the changes should not affect me, being a service provider. I hope I'm not wrong...