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Tiny businesses- how do they do it?


Viv
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I am aware from reading post here that setting up a business is far more difficult and costly, with 'up front' fees than in the UK. But, my local market has a number of traders [ eg Mum's selling home made jewellery during school hols -clearly not illegally as the local police are always mooching around!] and they cannot possibly be making much money at all.

How do they get round the huge fees / red tape etc?

I ask because I would like to do something similar but not if its going to cost me an arm and a leg upfront.

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I'm wondering the same thing. Have spent the last two hours reading postings in this forum about taxation for the self employed. Am moving to France in two months and have a small business that brings in less than £3000 gross per year which I was hoping to take with me.

Everything seems shrouded in mystery which only an accountant can unravel...

Can anyone advise please whether having the business as a MicroBic means that you just fill in a tax return at the end of the year as you do in the UK - or do you still have to pay the huge amounts (quoted as almost £2000 in one posting) in your first year regardless of your income?

Many thanks for any help given.

Jane
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Why on earth is it so complicated here...?

How did this complex system of paperwork evolve...?

ONE CHUFFING PROCEDURE IN THE U.K! and that can take place 3 months after you start up!

And yet there are ****** all controls on my barn renovation!

World turned upsidedown...eh?

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I think it's complicated because you are actively discouraged to be enterprising. I've given up on the idea of self employment as I've been 'lucky' enough to find work with a french company. With my minimum salary I have a range of add ons and tax insentives that my french neighbour is taking me through. His tax bill for last year was 31 Euros. I'll have to see how it pans but like for like I may be better off than in the UK.

In other words I am encouraged to earn as little as possible. As a capitalist and ex self employed guy I find this as frustrating as the next person. The flipside is that France, well where I live at least is like Britain was 50 years ago (I imagine) before the masses had access to house ownership and high levels of disposable income which seems to have turned the UK into a rather selfish, mean and brutal country. 

Perhaps, and I can't believe I'm stating this, It may be better if France stays like this so we will all stay poor and not have to worry about the new model BMW our neighbours just bought.

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All I want to do is have a little ebay shop / market stall and not get hammered....at least until I know how its going to pan out.

Does anyone know when selling on ebay starts to attract attention? especially when its all conducted in the fuzzy stateless internet world.

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Re ebay .. it seems that you can't really do that in France? set up a business and wait to see if it takes off....

EBay is regularly scanned by the IR in the UK, just as other Internet sites are for businesses that may be evading tax. The upside is that, invariably, they haven't enough manpower to do anything about cases that may well prove not to be cost-effective if taken to court. They do however record the information and if your name comes up at a later stage (for something else - eg. an audit on your books that looks suspicious ) they can link the two together.

I haven't a clue what they do with regard to ebay sellers in France though!

Surely this whole way of treating small start up businesses in France is contributing to their high unemployment figures and thus reducing their overall revenue?

I really need to find out more about MicroBics - have to make a decision in the next few days ... I am getting nowhere and I have read so much that I can feel a headache coming on :-)

I can empathise with "Perhaps, and I can't believe I'm stating this, It may be better if France stays like this so we will all stay poor and not have to worry about the new model BMW our neighbours just bought." though ... you may be right!

Jane
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Perhaps, and I can't believe I'm stating this, It may be better if France stays like this so we will all stay poor and not have to worry about the new model BMW our neighbours just bought.

Try living down here in Montpelliershire - goddam shiny mud-free 4x4s in town, mamans do the school runs in them and everything, just like England!   House prices are getting towards UK prices (believe me, I know!).   New building going on everywhere, traffic is getting to be a real problem all day long...... how glad am I that there are still some Poor People for me to be friends with! 

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As I see it, the most mysterious aspect of payments the self employed will have to make in France is not the actual tax - it's the Social contributions. We're frightened because we don't know precisely how much we will have to pay and whether our income will actually cover the charges. Also, even with a good knowledge of French, understanding the tax legislation forms may be beyond us and so the cost of a French accountant is also frightening (coupled with the fact that we have read that accountants advise differently .. so will we even be getting the correct advice?)

In David Hampshire's book 'Living and Working in France 2005' he states:

"Recent legislation has provided some more than welcome respite for the newly self-employed, who, instead of making crippling social security contributions from their start-up, now make contributions (as well as income-tax) as their business generates income. Eg, if you earn less than 27000 euros from a non-salaried source, you can declare it as a MICRO-BIC income on your tax return and you may be entitled to exoneration from part or all of the social security contributions on this income..."

He also says:

"If you're continuing a business you were conducting in your previous country of residence, where you were making social security contributions until the date of your move, you will be charged contributions in your first year of residence in France at a basic level equivalent to 30 per cent of the minimum contribution (around 1,100 euros). In your second year, you will be charged contributions according to your declared income for Year 1 on a pro rata basis (eg 50% if you moved to France on 1st July). Your Year 3 contributions will be calculated on your full year's salary in Year 2 and so on in subsequent years"

David Hampshire has a good reputation so I suspect we should believe the above...?

However..

I'm not sure whether the 1,100 euros mentioned as the basic level is actually 30 per cent or whether he means 30% of 1,100 euros...

After reading comments from others on this forum (Splash Internet and others) I'm not sure how to ensure that the French system actually treats your business in this way... notice the use of "may be entitled" in the first quote above :-)

Any helpful comments on simplifying all of this really will be welcomed - the name of an inexpensive accountant who speaks both French and English.. in the Normandy area.. also welcomed.

Jane
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Re: the E-bay suggestions, France may not be the best country to register in with E-Bay. I don't know much about them but I do know that when I wanted to sell some books and tried listing on Amazon France, they add-on TVA even for second-hand ones.  Difficult to make it worthwhile and I would suggest checking to see what E-Bay do re TVA.
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