Micro-enterprise regime is an ultra-simplified tax regime open to sole proprietorships, EIRLs and EURLs that do not exceed certain turnover thresholds. The micro-enterprise regime allows the entrepreneur to benefit from relatively reduced accounting and declaration obligations, to fall under the simplified micro-social regime, to be exempt from VAT and to opt under conditions for the final tax payment.
Before the Sapin 2 law came into force, only individual entrepreneurs, including those who opted for EIRL, could benefit from the micro-enterprise scheme.
Since the entry into force of the Sapin 2 law, single-member EURL or SARLs with a single associate manager who is a natural person can also benefit from the micro-enterprise scheme.
The revenue thresholds of the micro-enterprise scheme
The micro-enterprise scheme is only open to enterprises which do not cross certain annual revenue thresholds. Companies which exceed these thresholds for two consecutive calendar years cannot benefit from the micro-enterprise regime and therefore come under a real tax regime (real simplified regime or real normal regime). For that a proper Tax refund estimate is also important.
For the years 2020, 2021 and 2022, the revenue thresholds for the micro-enterprise scheme are set at:
- 176,200 euros for the sale of goods, objects, supplies and food to take away or to consume on site, or the provision of accommodation (hotels, guest rooms, furnished tourist accommodation),
- 72,500 euros for other service provision activities relating to industrial and commercial profits (BIC) and liberal professionals relating to non-commercial profits (BNC).
If the company carries out several activities, the rules are as follows:
In the case of mixed activities, the total amount of income must not exceed the limit of 176,200 euros, and the amount of income relating to the provision of services must not exceed the limit of 72,500 euros.
In the case of separate activities, the rule applicable in the case of mixed activities applies if the activities fall under different thresholds (sales activity and service provision activity, for example). If the activities fall under the same thresholds (two distinct service provision activities, for example), the limits applicable to the activities are assessed in relation to the company’s overall turnover.
The option for the micro-enterprise scheme
As long as the conditions are met to be able to benefit from it, it is possible to opt for the micro-enterprise regime. The option for the micro-enterprise regime is made directly on the declaration of creation of the enterprise. This is the P0 form for sole proprietorships and EIRLs, or the M0 form for EURLs.
The operation of the micro-enterprise regime
The creation of a micro-enterprise
The micro-enterprise is not a legal status but a tax system of taxation. The creation formalities therefore depend on the legal status of the company, which can be a sole proprietorship, an EIRL or a EURL when one wishes to benefit from the micro-enterprise regime.