The following may surprise or scare some people about the task that lies before them. But don’t worry, my point in spelling this out for you was to make the task easier and prepare you for any possible difficulties that could seem impossible to overcome. The classic Catch-22 situations come to mind.
The process of becoming a freelancer in France is not simple since freelancers are considered as one-person companies, and as such need to fulfil the necessary formalities. It took me 6 months to finish the process, but I was able to work in the meantime.
There’s no need to panic, because you take each step at a time and the French administration is not strict on IMMEDIATE adhesion. They realize it’s complex and give you the time to have your periodic nervous breakdowns.
Step 1- Request carte de séjour – Profession Libérale
They always want some documents that are not necessarily on the list. To ensure that you make a minimum of trips back and forth, I have made a quick list of things they expect you to know intuitively at birth.
You will need (in at least 2 copies):
- URSSAF inscription – the trick here is you need the inscription to have the carte, and you need the carte to have the inscription. A typical catch-22 situation. I had the URSSAF people sign and stamp a paper saying that I had visited them but they could not process the inscription until I had my carte de séjour. The Prefecture people gave me a paper saying my file was being processed, and the URSSAF people finally gave me the inscription, which I took back to the Prefecture people to get my carte.
Morals of the story:
YOU ALWAYS NEED A PAPER PROOF, they won’t believe you otherwise.
YOU ALWAYS NEED PATIENCE, or you wont survive the repeated visits.
- Recent diplomas (works highly in your favour) certified translated.
- Proof of financial stability – they say through bank statements, but it’s better to furnish letters or contracts of one or two clients saying that they have the intention of using you as a translator on a regular basis (even if it may not be true). Copies of invoices are also a plus.
- (This one is a bit hazy) Proof of your integration into French society. But I think if you can speak well enough to try to joke around with them, they’ll accept that.
Step 2 – Do a few jobs
You will need to have a few weeks to one month of activity before URSSAF will let you enrol as a freelancer or a one-person company. But if you are already in France before requesting a new carte de séjour, you can start doing some odd jobs, as long as it’s not your sole income. Just keep paperwork proof. This is easier to do if you were originally in France as a student.
Step 3 – URSSAF inscription
What’s good for the goose is good for the gander. Bring all the documents you took to the Prefecture for the carte de séjour. You will need to show them the proof that your request for the carte is in process. Make at least 2 copies of everything. They’re less needy than the Prefecture, but it’s still French administration.
They will send you all the information you need to include on your invoices:
- SIRET and SIREN number
- Contact with the Profession Liberale association for a new social security number
Step 4 – Visit the local Tax Authorities
This is a bit of a formality, but it’s good if you have any questions and you don’t personally know a tax specialist. Let them know you exist as a newbie freelancer, and they’ll tell you how to file your tax return and if you should charge a tax on your translations (VAT).
YES you pay French income tax.
NO, you do not pay a double tax from your home country.
(Tax treaties against double taxation)
Some interesting things I learned there*:
- for less than 27,000 € net income per year, you can file under a Micro BNC. That means you do not make itemized deductions for work expenses, instead they give you a general 37% deduction. This is good if you don’t have large expenses. They will automatically put you in the Micro BNC for your first year.
Example : You earned 25,000 € in translations this year (pretty good for a freshman)
Gross Income : 25,000 €
Automatic Micro BNC deduction : 37%
25,000€ - 37% = 15,750€ net (taxable) income
**See bottom for a quick reference on tax rates
- If you earn less than 27,000 € net per year, you do not have to charge TVA, which makes your clients VERY happy and is a good marketing point. On your invoices you will have to include the following sentence in case you’re audited one day:
article 293B du code générale des impôts exonération de TVA
(exempt from VAT under article 293B of the French General Tax Code)
- You can sign up with an association de gestion agréée that verifies your invoices and expenses for 200€/year. This makes sure your business practices and accounting are clean and they offer you a 20% tax deduction. This option is good if you are earning enough to no longer belong to the Micro BNC, which very often is not the case for the first couple of years starting out. So, this is a good idea once you’re well set up.
I’m including the following because I sometimes had some surprises, bad and good, in discovering these petty little details that I was expected to already know.
1- URSSAF contributions are at a fixed rate for the first year ( around 300 € ) and paid at the END of each quarter.
2- Social Security contributions are at a fixed rate (around 300 € ) and paid at the BEGINNING of each quarter.
3- A retirement agency will be chosen for you, and you will pay a fixed rate for the first year (around 600 €), afterwards adapted to your income.
4- A complementary retirement plan is obligatory after the first year (rate depends on what you choose), generally between 200 – 400 €.
5- URSSAF contributions include a training fund. Once you’ve paid this, you have the right to profit from it (around 45 €). This means you can take classes, seminars and such and URSSAF will pick up the bill, up to a point.
6- If you screw up and pay something too late, they will charge a hefty fee. But that’s ok, you can ask to be reimbursed by writing them a letter saying the following : “I’m stupid, I’m a foreigner. I just started, and I didn’t understand. Can I have my money back?” This generally works, but you have to write it a bit more formally than that.
7- Once a freelancer, you no longer have the right to unemployment. You can choose to have a supplementary unemployment insurance for downtimes when you can’t find work.
*The Percentages quoted here were taken from the 2004 General Tax Code, new percentages should be voted on by December 2004. They will be retroactively applicable to 2004 incomes. Upon discussion with a French tax specialist, it is considered that contrary to the last few years, the percentages will be increasing a bit. So be prepared.
**Loi de Finance 2004 -
Tax Rate Quick Reference (based on a single’s net income with no dependants )
< 4,262 € ------------------- 0%
4,262 – 8,382 € ---------------- 6,83%
8,382 – 14,753 € ---------------19,14%
14,753 – 23,888 € ---------------28,26%