I've tried to be a good girl, Mr. Tax Man (or Tax Woman). Honestly I have! I informed the UK I was leaving, I informed France I was arriving, I checked what I needed to do online and over the phone and I have notified all necessary authorities that I intended to continue carrying out my business in a new country. I had also been told that the newish 'auto-entrepeneur' system would mean fewer nasty backdated payment surprises and a simplified process for registering yourself as self-employed, if you have an annual income of less than 32,600 Euros.
Perfect! I thought.
Simple, I anticipated.
But, just like getting your residence permit, buying a car with the right kind of licence plates, getting car insurance or internet access, having your gas connected or your roof repaired, nothing is ever simple in this part of the world.
Here is how setting up your own business works in the UK: you decide to become self-employed, you inform HM Revenue and Customs as soon as possible, and they send you a self-assessment form after you have been operating for about a year.
Here is how it works in France:
1) You find out if you can become an auto-entrepreneur, as not all types of activities are covered. If you want to work freelance for the local 'mairie', for instance, as a gardener and driver, you have to choose which of the two activities you will pursue, as they belong to different areas (different chambers) and are taxed differently. Switching activities can be expensive and a logistical nightmare.
2) You have to give an exact account of your most recent activities and income for the past two years, as this will impact on your ability to register for the auto-entrepreneur status. Have you been working freelance, were you in full-time employment, were you studying or receiving unemployment benefit? There are certain restrictions, to discourage people to keep on starting up new businesses (and thus pay less taxes) or to discourage employers from using casual workers instead of properly insured and protected employees.
3) You need to find out where to register. If you're opening a shop, you will inform the Chamber of Commerce and Industry CFE, if you're a jewellery maker or boulanger, you will inform the Chambre de Métiers CFE, if you're a consultant or language teacher, you'll be informing the URSAFF and so on.
4) You fill in a form online and send it off. This really is simple. Except that the form has many options that you don't really understand, so you tick things somewhat randomly.
5) A few days later you will get a phone call from an adviser at the CFE asking if you really intended to charge VAT and whether you qualify for the régime micro-social simplifié. I thought it was my language ability holding me back, but when I attended a course on setting up your own business, where 99% of the attendees were French, I found the others really struggled to understand all the differences and implications too.
6) You will then become a target for letters, some of it junkmail, but some of it demands for payment. Your cotisation. The URSAFF, the RSI, the CIPAV, Groupe Mornay, INSEE and many others will be in touch. Some are optional, but it's not always easy to tell which when you see rather solemn-looking invoices attached. Of course the Inland Revenue will be in touch very soon too, even if you don't have to pay any taxes for a few months.
7) It gets even more complicated if you want to apply for help (tax relief) for starting your business, the so-called ACCRE, which applies to the unemployed workers or young people aged 18-25. Another form to fill and your circumstances will be checked before a decision is made.
8) Throughout the year, there will then be a complex pattern of different dates for different sums, some of them upfront (regardless of amount of revenue), some of them based on your declared income, plus different dates for declaring your chiffre d'affaires (which is overall revenue, rather than just profit).
In conclusion, accountants must be doing a booming business here! In the UK I was doing my own accounting, but the risks are too high here of getting something wrong with all this complexity. Best if you see this is a personal crusade against the tyranny of bureaucracy, to put you in the right frame of mind!
Second observation, the local chambers of commerce for your ‘département’ organise regular workshops or information sessions on becoming self-employed. I strongly recommend attending one of these and asking lots of questions.
Finally, there are some useful websites out there, although none of them quite 100% as clear and straightforward as us of little minds would like to see them:
http://www.autoentrepreneurs.com/
http://www.cci.fr/web/auto-entrepreneur
And, if you prefer some information in English, I would also recommend the following:
http://www.startbusinessinfrance.com/index.php/news/category/auto-entrepreneur
http://www.frenchentree.com/france-employment-work-jobs/DisplayArticle.asp?ID=20544
http://paris.angloinfo.com/countries/france/business.asp
