Paying auto entrepreneur tax

Can anyone advise me on how to work out how much tax I should pay the auto entrepreneur I employ? He claims tax is 23.159%. Am I being entirely stupid in considering the tax on €2,500 should be €578.97 and so the total payment should be €3,078.97 and not €3,253.51 he is claiming ?

Thanks in advance for your thoughts. Paul Smith

I don't understand the question. Why is he asking you to pay his tax?

A micro entrepreneur artisan pays cotisations (mainly healthcare contributions) - nothing to do with income tax or any other tax - at approx 23 per cent of his turnover. So if he invoices you for 3k, he will declare that as his turnover and pay cotisations of approx 700€.

As his client, it is not your job to pay this. He should give you a bill for the work he's done, and you pay that, end of story. It's up to him to declare his income and pay his own cotisations and taxes. It would be ridiculous. If he charges 3k for the job, and adds on 700 "tax" and you pay him 3700, then his turnover has now become 3700; so he would have to pay another 23 per cent of the extra 700 turnover. It could go on for ever.

If he wants to invoice you for 2500€ and then ask you to pay an extra 23 per cent that is not shown on the invoice so that he doesn't have to declare it, then that is fraud. He must declare everything his clients pay him.

I agree entirely with Anna.

If he has miscalculated his rate for the job then more fool him. I would only pay the correctly invoiced (and presumably correctly devis' amount) and nothing more.

Let him go whistle for the rest but keep all your documentation in good order. If his devis and his invoice is not in french, he'll find it difficult to get a lawyer to take his case anyway.

In fact I wonder if that's what he's done - added on 23 per cent of 2500 ie 578.97 as you say, then added 23 per cent of that 578 which would be around 130, then added 23 per cent of the new 130, etc, etc, until he got to 3,253.51 and gave up - my maths isn't up to checking! but it sounds possible!

It reminds me of having to work out radioactive "half lives" in physics at school - the calculation is infinite because there is never a final answer, you just keep adding on tinier and tinier amounts.

No. As Graham says, every artisan, no matter what business structure he uses, has to take all his business overheads into account when he fixes his price for the job, and if this guy didn't then more fool him. The price quoted for the job is the price that should be invoiced for and the price the client should pay. The artisan subsequently pays his cotisations and taxes out of what he earns but that's his business and nothing to do with the client.