How the Self-Employed Persons Declare their Taxes

A self-employed worker decides on the form of his activity, he is relatively free in the choice of legal status. The self-employed worker therefore enjoys obvious autonomy in the organization of his work, is not subject to a third authority and is also entitled to social and fiscal advantages corresponding to the chosen legal form.

 Differentiate between the terms

Unlike the self-employed, self-employed worker is not a social status. It only means that you are working for yourself. A self-employed person can choose the status of auto-entrepreneur. It is a question of choosing the status of sole proprietorship in this case. On the contrary, a self-employed worker is not necessarily a sole proprietorship. He can opt for the status of partner in a commercial enterprise. If you choose to be freelance, the only possible choices are the sole proprietorship (EI, EIRL or self-employed) or the one-person business. Click here for the best results.

The tax regime of the self-employed

There are two categories of self-employed workers: those exercising a liberal activity or artisans and industrialists. As a freelance worker in a liberal profession (consulting, law, medicine, architecture), your activity is said to be liberal and falls under the category of Non Commercial Benefits (BNC). Craftsmen and manufacturers are taxed on industrial and commercial profits (BIC). The corresponding legal status is that of the sole proprietorship and the most favorable tax regime must be chosen from among the following three different methods of calculating income tax:

  • Real income tax regime
  • Micro-enterprise regime
  • Withholding tax on income tax (if you are a self-employed person)

Reality regime

In this case, we take the annual result of the company that is to say the annual turnover excluding tax from which or subtract the deductible charges. The self-employed person must pay VAT. He must keep a journal book, annexes, as well as the publication of the annual accounts. If the annual turnover exceeds a threshold of 236,000 euros, additional obligations must be taken into account. Otherwise, we can speak of a simplified real regime.

Micro-enterprise tax regime

We calculate here the annual turnover excluding tax from which we subtract the tax allowance for professional expenses. This tax allowance corresponds to 34% for BNC (Non Commercial Profits). The flat-rate income serving as the basis for calculating income tax is thus 66% of annual turnover. These self-employed workers benefit from simplified accounting. However, if the turnover one day exceeds the threshold of 32,900 euros, the tax regime will have to be changed to the real regime or by creating a company.

Self-employed person: withholding tax

A self-employed worker who has chosen to be a self-employed person is subject to the micro-enterprise tax regime. An alternative is to choose the final payment of the income tax if the fiscal income of the first two years is lower than the threshold defined by the BNC. The tax to be paid as part of the withholding tax corresponds to 2.2% of monthly or quarterly turnover, depending on the option chosen.