Each year, the Government votes a new “Loi de Finance” or Finance Act with changes impacting existing and future businesses. Here is a summary of the key changes that could impact your business in 2022.
Lower corporation tax in France
In 2022, the final stage of the 2018 corporation tax reform came into effect. The standard corporation tax rate has been lowered to 25%. This is a steady improvement compared to the 28% back in 2018. Bear in mind that your first 38,120€ of profits are still liable for a lower incorporation tax rate of 15%. The new rule therefore applies to all benefits above 38,120€.
Deadline extension to opt for a different tax regime
This one is a little tougher to explain, but again it is very good news. Sole traders such as micro-entrepreneurs are under a regime called micro BIC. It basically means that they are paying fixed social charges based on their sales. The next regime up is called “entreprise individuelle reel simplifié”, where you pay your social charges based on your profit.
Until now, you could only switch regime until the 1st February, for the change to be applied for the same year. The loi de finance 2022 makes it possible to increase the duration of this option period. As of 1st January 2022, it is possible to opt for regime reel until the deadline for filing the overall income tax return. In practice, this means that you can decide to switch until May or June of the following year.
This also means that someone under regime reel wanting to switch back to regime micro would also have until May-June to request this change.
You can read more about this here (in French) and I recommend that you speak to an accountant if this is something you want to do.
Amount doubled on tax credit for entrepreneurs' training
The tax credit for training entrepreneurs and managers has doubled in 2022. I’m afraid that this only applies to businesses under regime reel, so this is entreprise individuelle au reel (not micro entrepreneurs), EURL/SARL, SAS/SASU. If you are a company director who wants to acquire new skills, you can benefit from a tax advantage in the form of a tax credit on your training expenses.
Loi de finance doubles the amount of tax credit for the managers of companies meeting the following conditions: fewer than 10 employees and a turnover or balance sheet total of less than €2 million. If you are on my blog, this is definitely you! You can find out more about this here. Also ask your accountant.
Simplified access to online services for businesses
I’m not sure whether I should cheer or cry about this one. New government websites tend to give me headaches about bugs and lost customer files. Still, the intent is definitely good, as there are currently too many sites to use (think guichet unique, info Greffe, URSSAF, Impots) and none of them talking to each other. The idea of getting a site with both Impots and Urssaf together does sound like a utopia to me, but I’m ready to try it!
In order to simplify the search for information and the completion of online procedures for businesses, three new websites will be launched in 2022. Yep, THREE! Can you see my eyes rolling…
Creation, registration, modification, closure, declaration, payment... many procedures that are currently carried out by businesses on a multitude of sites will now be centralised on these three sites. Alleluia!
- Formalites.entreprises.gouv.fr launched on 1st January for business registration, modification, closure or to publish your loss and profits account (for SARL/SAS). This new site will pool the resources of around ten different sites (!!) including those from the Centre de Formalité des Entreprises (CFE i.e. Chambre de Commerce, Chambre de Metiers, URSSAF, Guichet Unique, etc), and will replace them as of 1 January 2023.
- Entreprendre.service-public.fr . From February 2022, this site will be the reference for information and guidance for people wishing to create or run a business. It will bring together, reliable, up-to-date, personalised and free resources, all the useful information and tools for creating, running and developing their economic activity on a daily basis. It looks like a mixture of information from two previous reliable sources economie.gouv.fr and BPI France.
- Portailpro.gouv.fr Planned for mid-February 2022, this third site will simplify and unify the declaration and payment procedures for professionals. Entrepreneurs will be able to access within a single space the services offered by the tax office, Urssaf and Customs. Designed as a tool for day-to-day management, it will make it easier to complete all tax, customs and social security procedures. This is definitely the one that I am looking forward to having a look at - the tax office AND Urssaf together, as well as customs, this would a clear revolution!
According to the press release “Thanks to a unique identifier, it will be possible to monitor one's situation in real-time, summarised in a single dashboard. A single secure messaging system will enable dialogue with the public services concerned: Urssaf, Customs or Public Finance”. Yes, please!
This one is a big change regarding business setup and management, so I will test them over the next few months and will cover it on a regular based on my fortnightly emails.
Read more about Loi de Finance 2022 (in French)