Pickles Posted September 29, 2012 Share Posted September 29, 2012 According to Midi Libre, (here) the budget proposals announced yesterday (Friday 28th Sept) include the intention to align the cotisations of AE with those of a sole trader. So what would be the point of having the AE regime? Or is that the point (to end AE)? Link to comment Share on other sites More sharing options...
NormanH Posted September 29, 2012 Share Posted September 29, 2012 It certainly seems like it if an AE will have to pay a fixed amount as social charges rather than a % of the takings, since many AEs earn very little and the fixed charge may well be a much higher sum than they have been paying.Grégoire Leclercq et Cyrille Darrigade, respectivement président et Vice-Président de la FEDAE ont réagi vivement : « Le régime sera tué car le mode de calcul des cotisations sociales sera forfaitaire et remet en cause le pilier fondateur du régime qui prévoyait une exonération de charges en l’absence de chiffres d’affaires.La réforme n’améliora pas la protection sociale des bénéficiaires du régime dans la mesure où cette protection était déjà identique à celle des autres travailleurs indépendants. » http://www.federation-auto-entrepreneur.fr/auto-entrepreneur/actualite/2012/09/28/actualite-alerte-le-budget-2013-casse-le-regime-de-lauto-entrepreneur.html Link to comment Share on other sites More sharing options...
Chancer Posted September 29, 2012 Share Posted September 29, 2012 Interesting that they talk of an economie of 130 million Euros, its not as if they are paying out that sum to the AE's, au contraire its the extra cotisation that they will impose on them and are greedily awaiting.What of course will happen is that the vast majority will just cease AE and either return to the black or worst still claim unemployment benefit so it will actually add a massive cost not make a saving.What I dont get is that there should be no saving at all, AE's pay the same cotisations as anyone on the micro BIC regime its just that AE is much fairer and equitable in that they don get hammered for cotisations on notional income in the early years which al settles out in later years.Sounds like they will impose a minimum forfait but I bet unlike a micro BIC it wont be refundable.Not sending out a good message to business in general and especially would be entrepeneurs. Link to comment Share on other sites More sharing options...
AnOther Posted September 29, 2012 Share Posted September 29, 2012 Those registered as AE simply to secure health care will have to do the sums to see if the cotisations are higher than the premiums for private health insurance.A reprise of 2007 looming perhaps ? Link to comment Share on other sites More sharing options...
NormanH Posted September 29, 2012 Share Posted September 29, 2012 "What of course will happen is that the vast majority will just cease AE and either return to the black or worst still claim unemployment benefit so it will actually add a massive cost not make a saving."Can people who have been AE claim unemployment? I really don't know but I rather doubt it. A genuine question if anybody does know... Link to comment Share on other sites More sharing options...
Daft Doctor Posted September 29, 2012 Share Posted September 29, 2012 Hi, reading the comments attached to the article linked to in the initial post, the French seem to think that the consequence of fixed cotisations will be an exodus from AE in favour working on the black and/or going on the dole. The cost in lost cotisations and increased benefits payable will likely be much greater than the alleged 130 million euro gains. From a personal viewpoint (my wife is an AE) on the issue of healthcare, the fixed cotisations payable under a revised AE regime would have to be of the order of 10,000 euros per year to be more onerous than the cost of compulsory private medical cover for me, my wife and my son, and that's assuming that non of us has a pre-existing medical condition and that health insurance providing truly comprehensive cover is indeed available (previous threads have cast doubt on whether such a product exists - enough to satisfy the French in terms of qualifying for re-entry to CPAM after 5 years residency in any case). What may be clearer in 2 or 3 years time is whether (after the relatively recent EU directive on the matter) having had prior health cover through an S1 or via RSI would permit subsequent access to healthcare through CPAM before the 5 year residency period is complete. In that case it may be a case of what costs the less in cotisations, CPAM or AE. Incidentally, does anyone know what the fixed cotisations are currently for Micro-BIC? Link to comment Share on other sites More sharing options...
NormanH Posted September 29, 2012 Share Posted September 29, 2012 From a personal viewpoint (my wife is an AE) on the issue of healthcare, the fixed cotisations payable under a revised AE regime would have to be of the order of 10,000 euros per year to be more onerous than the cost of compulsory private medical cover for me, my wife and my sonBut don't you also have to pay 6.6% CSG and .5% CFDT on the whole household income, your pension included, since you are à la charge de La France for health care?I don't know, but if you do that could be a considerable extra burden on top of the new fixed côtisations.. Link to comment Share on other sites More sharing options...
Daft Doctor Posted September 29, 2012 Share Posted September 29, 2012 Hi Norman, I and my son are not yet à la charge de La France for healthcare, we have S1 cover until Jan 2014. My wife gets her healthcare through an RSI as an AE and it is true that unless the rules change we will piggy back after onto her healthcare when the S1's run out. I don't know what extra social charges that will entail directly or indirectly, but even if an extra 7.1% is indeed payable on the household income taxable in France (a substantial part of our income is from UK property, i.e. income taxed wholly in the UK and not liable to French tax or social charges), then if my assumption that starting cotisations under micro-BIC are approx 3,000 euros for the first year, adjusted accordingly afterwards according to profit, the total will still be nowhere near 10,000 euros, my estimate for private healthcare cover for us all. There is bound to be a substantial cost for healthcare in France somewhere down the line and its right that we pay it, it is just best to be prepared for these eventualities and plan accordingly. I'm more than happy to pay our way properly in France, the 6 months spent here already tells us that this is the place we want to stay. Link to comment Share on other sites More sharing options...
NormanH Posted September 29, 2012 Share Posted September 29, 2012 Fine I just wanted you to have the information you need to make the calculations[:)] Link to comment Share on other sites More sharing options...
Daft Doctor Posted September 29, 2012 Share Posted September 29, 2012 Much appreciated Norman, it's a bit of a minefield and the mines are being moved constantly at the mo! [:D] Link to comment Share on other sites More sharing options...
EmilyA Posted September 29, 2012 Share Posted September 29, 2012 We had a micro-entreprise (before AE started). We did not have to pay the high charges up front after Year 1. We went to RSI with a spreadsheet of our estimated revenues and they adjusted the cotisations accordingly. Though many of our transactions with RSI were pretty nightmarish, this was one of the easy ones. As this provided our health care, we did pay the minimum amount for full cover, though. Link to comment Share on other sites More sharing options...
Debra Posted September 30, 2012 Share Posted September 30, 2012 I'm probably being a bit dim (I'm full of cold at the moment so I'm not at my mental best!) but I thought that if one of the family was entitled to healthcare via being active in France then the whole family had to go with that method and piggy back on the entitled person. I didn't realise you could have Dad and son on an S1 but Mum entitled in France via an AE......? Link to comment Share on other sites More sharing options...
5-element Posted October 1, 2012 Share Posted October 1, 2012 Debra, I am not quite sure if this will answer your query: my husband has an S1, and I do not anymore since I started claiming my very tiny French pension. So he is not à la charge du régime social here, but I am - even though the bulk of my income is from a UK state pension. There was no choice for me, I couldn't remain on my S1 - from the moment I claimed my bit of French pension, I was automatically switched onto the French regime. So I should be paying CSG and the other social charges from all of my income, whereas my husband will not. This gets a bit complicated when filing our tax return, which naturally, is a joint one... Link to comment Share on other sites More sharing options...
Daft Doctor Posted October 1, 2012 Share Posted October 1, 2012 Hi, unlike the tax system which involves households, as I understand it everyone is treated individually with respect to their healthcare in France. My OH doesn't have a choice in the matter, as an AE she must get her cover (in her case) through RSI. I on the other hand, as an inactif with an S1 had in theory a choice. I opted to use the S1 route for my son and I until it expires in 2014, as there is uncertainty about the future of AE and healthcare rights. Indeed when I spoke to the DWP about my S1 they intimated that the French would expect me to use it rather than piggy back. After the S1 expires however, I will have no healthcare rights of my own so will legitimately be able to piggy back on my OH's as a dependant. Link to comment Share on other sites More sharing options...
AnOther Posted October 1, 2012 Share Posted October 1, 2012 Like Debra I too was under the impression that strictly speaking an S1 was only appropriate where health care could not be secured by other means, i.e. on the back of AE in this case. I'm not surprised the French are happy for you to be on your own S1 though, it means they get money from UK whereas under AE they only stand to get a percentage of the standard deduction which of course they will already be getting anyway.The convoluted tax situation 5-element mentions is one of the less obvious consequences of working in France and I'm pretty sure that many currently registered as AE do not appreciate the potential future implications of their decision. Link to comment Share on other sites More sharing options...
NormanH Posted October 1, 2012 Share Posted October 1, 2012 The convoluted tax situation 5-element mentions is one of the less obvious consequences of working in FranceYes you are right. As I worked enough in France to qualify for a small pension I like 5e am à la charge of France for health cover and so have to pay côtisations on my income.The rule is that if you get a pension from the country you live in it is that country which is responsible for your care, even if you worked much longer elsewhere.On the other hand if you worked in several countries it is the one where you made the most contributions which is responsible.This will possibly mean that those who have worked a bit in France and built up entitlement to a pension will find themselves in the same case as 5e and I...paying social charges in France. Link to comment Share on other sites More sharing options...
Debra Posted October 1, 2012 Share Posted October 1, 2012 [quote user="AnOther"]Like Debra I too was under the impression that strictly speaking an S1 was only appropriate where health care could not be secured by other means, i.e. on the back of AE in this case. [/quote]I'm pretty sure that when we first came over and had our forms to register with CPAM, it said on them that if either of us starting an activity then they would no longer be valid. However that was just after all that 2007 stuff and they changed the form names so I don't know if they say that now. Link to comment Share on other sites More sharing options...
Debra Posted October 1, 2012 Share Posted October 1, 2012 [quote user="NormanH"]This will possibly mean that those who have worked a bit in France and built up entitlement to a pension will find themselves in the same case as 5e and I...paying social charges in France.[/quote]Would a non taxable (but ordinarily taxable only in the UK) HM Forces pension be taxable for 'social charges'? Link to comment Share on other sites More sharing options...
idun Posted October 1, 2012 Share Posted October 1, 2012 [quote user="NormanH"]The convoluted tax situation 5-element mentions is one of the less obvious consequences of working in FranceYes you are right. As I worked enough in France to qualify for a small pension I like 5e am à la charge of France for health cover and so have to pay côtisations on my income.The rule is that if you get a pension from the country you live in it is that country which is responsible for your care, even if you worked much longer elsewhere.On the other hand if you worked in several countries it is the one where you made the most contributions which is responsible.This will possibly mean that those who have worked a bit in France and built up entitlement to a pension will find themselves in the same case as 5e and I...paying social charges in France.[/quote]Not quite NH, as 5E said and you your self have said, you are both under french health care, even though you paid most elsewhere. We, now living in the UK, will be eventually under UK health care when the UK pension eventually starts, even though that is the smallest part, residence apparently has a lot to do with it too.[:)] Link to comment Share on other sites More sharing options...
Debra Posted October 1, 2012 Share Posted October 1, 2012 [quote user="idun"][quote user="NormanH"]The convoluted tax situation 5-element mentions is one of the less obvious consequences of working in FranceYes you are right. As I worked enough in France to qualify for a small pension I like 5e am à la charge of France for health cover and so have to pay côtisations on my income.The rule is that if you get a pension from the country you live in it is that country which is responsible for your care, even if you worked much longer elsewhere.On the other hand if you worked in several countries it is the one where you made the most contributions which is responsible.This will possibly mean that those who have worked a bit in France and built up entitlement to a pension will find themselves in the same case as 5e and I...paying social charges in France.[/quote]Not quite NH, as 5E said and you your self have said, you are both under french health care, even though you paid most elsewhere. We, now living in the UK, will be eventually under UK health care when the UK pension eventually starts, even though that is the smallest part, residence apparently has a lot to do with it too.[:)][/quote]Aren't you saying the same thing as Norman did, Idun? Aren't you under UK healthcare already though, being a UK national and resident there? Link to comment Share on other sites More sharing options...
NormanH Posted October 1, 2012 Share Posted October 1, 2012 [quote user="Debra"][quote user="NormanH"]This will possibly mean that those who have worked a bit in France and built up entitlement to a pension will find themselves in the same case as 5e and I...paying social charges in France.[/quote]Would a non taxable (but ordinarily taxable only in the UK) HM Forces pension be taxable for 'social charges'?[/quote]This is a thorny question that I think parsnips has answered by saying that such pensions are exempt from these charges, although the OAP and any French pensions are taxable.I find my self going round and round to find the text which substantiates this, but the Government site says thisVos revenus sont soumis à la CSG et à la CRDS si vous êtes : domicilié en France pour l'établissement de l'impôt sur le revenu, et à la charge, à quelque titre que ce soit, d'un régime obligatoire français d'assurance maladie.CSG et CRDS sont prélevées sur pensions de retraite, pensions d'invalidité.http://vosdroits.service-public.fr/particuliers/F2971.xhtmlSomewhere parsnips (who is usually spot on on such matters) was able to assure me that the UK Gov Part could NOT be included in this In any this is of course only the case for people whose French pension makes them à la charge of the French. Link to comment Share on other sites More sharing options...
Daft Doctor Posted October 1, 2012 Share Posted October 1, 2012 My NHS pension is non-government, so taxable in France, but I thought that for as long as I was entitled to health cover via my early-retiree S1 I wouldn't pay CSG and CRDS on it? After the S1 expires in 2014, I expected I might be liable for the 7.1% charged currently, but I'm not sure whether where I get my health cover from would then matter. If I am piggybacking as a dependent onto my wife's cover through RSI would I still pay CSG & CRDS, or would it only be if I was able to remain in the system through affiliation to CMU (if by that stage such a move is permitted)? Any insight would be useful for forward planning. Link to comment Share on other sites More sharing options...
NormanH Posted October 1, 2012 Share Posted October 1, 2012 If I am piggybacking as a dependent onto my wife's cover through RSI would I still pay CSG & CRDS, or would it only be if I was able to remain in the system through affiliation to CMU (if by that stage such a move is permitted)Surely in either case you are part of the French system.It is only people with S1s who are exempt...but it is really a very muddy area where none of us seem able to be definitively sure Link to comment Share on other sites More sharing options...
Chancer Posted October 2, 2012 Share Posted October 2, 2012 Looks like a storm in a teacup: http://tempsreel.nouvelobs.com/economie/20121001.OBS4174/exclusif-fleur-pellerin-les-fondements-de-l-auto-entrepreneuriat-sont-preserves.htmlAlthough cotisations will probably rise.Pretty poor (initial) communication from the goevernment, more what I would expect from a dictator or has it always been that way in France? Link to comment Share on other sites More sharing options...
NormanH Posted October 2, 2012 Share Posted October 2, 2012 This is what she says about côtisations:En revanche, le projet du gouvernement prévoit que les taux de cotisations sociales passent de 12% à 14% pour les activités commerciales, de 18,3% à 21,3% pour les libéraux, et de 21,3% à 24,6% pour les services. Le chiffre d’affaires annuel moyen d’un auto-entrepreneur étant d’un peu plus de 9.200 euros, cela représente entre 15 euros et 25 euros par mois et par auto-entrepreneur en fonction des statuts. Link to comment Share on other sites More sharing options...
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