AE - deductions for expenses

As a relatively new AE working as Batiment general

It has been pointed out to me that i am wrongly declaring All my turnover to the RSI every trimester. I have been told by a friend that I am allowed to make a deduction for my expenses before making the RSI deceleration. Can anyone please comment on this?


Hi all, new here, just trying to get my AE set up,(building services) went to see Louise in Domfront (government funded administrator) we discussed SARL and AE, with the new changes to tax charges SARL now starts at £3500 for the first year and £6000 for the second year, meaning that I would have to [pay £9000 in the first 13 months of set up, who can start like that?

That's why i'll be going down the AE route, even though that's changing slightly too

Happy hunting

Complete numpties!

yep, they got it wrong for us too - 12.000€ this year :-O

It does if you declare online as I found out!

But when you are an employee, the company must pay the charges on the salary which is even more expensive than paying it on your own profit/income. In France there is no such thing as paying nothing in business, the best you will get is if you are unemployed and qualify for reduced cotisations - also available as AE or set up in various regeneration zones.

As a 'travailleur independente' apparently we pay 'reduced' cotisations as we are not entitled to chomage and only minimal sick pay (practically none).

Unless you have large outgoings or a large amount of money to live on until your business is up and running minimum three years, AE is the way forward.

Bargain at half the price Andrew, my forfait was 6000€ in year one as was my husband this year; RSI did get mine wrong though so I paid 11000€ this year to make it up. Add on the increase in TVA which meant I paid 2200€ to les impots that was a lot of money to lake as a self employed person before I could start paying my costs and actually earning any money.

To put it all in proportion my husband and I don't earn enough to pay income tax but the state certainly gets their share from us.

Yes Tracy, never got that. No way midday means anything...

And note the date they send you as a deadline has a cut-of point of midday as far as I remember! Stupid idea.

and the changes are usually against you, John, when we set up our snc we could take dividends without paying charges sociales - we never got to benefit from that as that was abolished before the end of our first year!!! :-(

Tony, you'll pay 48% charges sociales on everthing you take out of the sarl as income, not on profit. If you leave profit in the company then you'll pay IS (impôts sur la société) on that but not charges sociales, unless of course you take the profit as income. Yes, changes are expensive, I'm changing the share distribution and so the statuts have to registered again at la greffe so a minimum 450€ to pay there plus the cost of changing the statuts...! BTW my initial forfait was 4500€ a year as was my OH's.

True on both counts Andrew and Tony. Yes, several things are afoot and I think there will be some major changes to a sarl for under 10 employees soon..... however please note that a SAS for example its manager is part of the General System and not of the TNS and is therefore considered an employee.

If you earn nothing you pay nothing (at least for the first few years) , now THAT is better than AE isn't it?

Now beware, if your company is to turn over large sums and you would like a large take home pay, the SARL could be the way to go....

Again, never go on gut feeling, ask a pro and yes, I know it costs money to ask but it could save ou SOOO much money!

Many accountants recommend against the status of AE, for a number of reasons, but it all depedns what suits your own particular circumstances.
Setting up and/or modifying an SARL can be quite costly (just to take over an existing one cost me around €1200), and the HUGE inconvenience is that ALL of the partners will have to contribute to the RSI (that's the NI service for self-employed people) — which is currently coming in fro a lot of flak and is to some extent in turmoil; they are notorious for their inefficiency, mistakes, and strong-arm tactics when it comes to recovering their money.
As a rough guide, the RSI contributions will be around 48% of your PROFIT; of course, you can arrange your accounts so you don't make any profit, BUT there is still a minimum contribution of something like €1800. I don't quite know how they calculate it, but it seems this minimum contribution applies to EACH partner; so if you start an SARL as say a husband and wife team, even if in your first year you don't make any profit at all (on paper or even in reality), you will still have to fork out a fairly hefty sum to the RSI.

So depending on the nature of your business as well as its scale, you might find AE is a good way to start up. I was originally a micro-entreprise, and I was struggling to find €600 a month to pay the RSI, given that my freelance income is highly variable from month to month. When I changed over to AE, not only did my overll charges drop slightly, but also, I only had to pay a percentage in any month I had actually earned something — and I had a month to pay it in. To me, that was a life-saver.

There are many changes affot, it is high time the whole system was reformed, so make sure you do have the most up to date information!

Good point, John, but most here are on small start-ups/turnover and the forfait for charges sociales would sink them before they start hence the autoentrepreneur being ideal for them. Some of us have moved on from there - I now run a SNC and employ and Tracy is now in a mainstream régime too. People seem to get hung up on the expenses side of things but often don't realise they're alreay calculated into the equation with charges sociales at half what it is in the mainstream régimes...! AE is not the best way to go if expenses are high (unless you can get the client to pay the expesnses, materials etc, direct) but it is risk free which the mainstream régime aren't. ;-)

Hi All,

I hear of AE all the time but there are indeed many other types, SARL for example is a french limited company that not only allows you to make deductions but the key factor is in the fact that the company actually pays the contributions AND your complementary health insurance!

Now, doesn't that sound better?

My advice would be, do not JUMP down the AE route straight away, ask a professional or a company (see blog) who could really help you decide and save lots of money!

you could try making a mistake

First of the month each quarter by the calendar. Believe or not, it is sent out automatically at midnight as the calendar turns. Consequently my notification arrived as the first email of 2015 a few seconds into the year. One has until the last day of the month to pay up, 31 January (actually Monday 2 February this time because 31 is a weekend this quarter).

Tony/Brian, thanks for the info. Once registered as an AE, we will do the paperwork over the weekend, do the AE people set the dates for Quarterly returns?

That is very diplomatic of you Steve, I would suggest a list of expletives followed by impossible would sum it up, but not help anyway :-(

Oh you mean the CUSTOMER'S accountant. I thought you meant YOUR accountant. If it all came in one cheque yes, difficult.