Business in France: how to open Auto-entrepreneur (Micro-entreprise) status and not get confused about taxes
For foreigners in France, the simplest way to start working for yourself is through the Auto-entrepreneur (Micro-entreprise) status — it does not require share capital. Taxes and social contributions are paid as a percentage of turnover, rather than as a fixed amount regardless of income.
International Law Firm "Zahist" assists clients in France with Auto-entrepreneur registration and subsequent tax matters. In our experience, it is precisely at the stage of choosing between the versement libératoire and the ordinary progressive scale that entrepreneurs most often lose money.
The reason is usually simple: the decision is copied from acquaintances instead of calculating one’s own situation — taking into account marital status and expected turnover, the figures can differ several times over.
Below we cover all the key stages: from choosing the format and registration through to calculating social contributions, income tax, and specifics for Ukrainian citizens.
Business in France — which formats are available to foreigners
Business in France can be conducted in several organizational forms: Auto-entrepreneur (Micro-entreprise), ordinary EI, EURL, or SAS.
For most foreigners at the outset, the simplified status is optimal — it does not require share capital and allows work to begin within a few weeks.
EI without the Micro-entreprise regime, EURL, and SAS require full accounting and suit those who from the very start plan large turnovers or bringing in partners.
| Form | Accounting | Share capital | Liability |
| Auto-entrepreneur | simplified | not required | with personal assets |
| EI (ordinary regime) | full | not required | with personal assets |
| EURL | full | from 1 euro | limited to the contribution |
| SAS | full | from 1 euro | limited to the contribution |
Auto-entrepreneur vs Micro-entreprise — what is the difference and why they are the same
Auto-entrepreneur is the former name of the regime, while Micro-entreprise is the official term used in legislation since 2016; in practice it is one and the same status.
Confusion persists because both terms still appear on government websites and in entrepreneurs’ everyday speech.
From a legal standpoint there is no difference: the rules on registration, taxation, and social contributions are entirely the same regardless of which name a particular website or bank uses.
Small business in France — who can register Auto-entrepreneur status
Small business in France in the Micro-entreprise format may be opened by an adult EU resident, as well as by a foreigner with a residence permit that allows self-employment.
Holders of temporary protection and certain other statuses are entitled to register as Auto-entrepreneur if their residence permit does not contain an express prohibition on entrepreneurship.
Minors may also obtain this status with the written consent of their parents, but in practice such cases among foreigners are rare.
Combining Auto-entrepreneur activity with employment under an employment contract is permitted by law without restriction, provided it is not prohibited by the terms of the particular residence permit.
Such a combination is often chosen in the first year: a stable salary reduces risks while a small business is still building clients and steady turnover.
How to start a business in France — Auto-entrepreneur registration step by step
How to start a business in France is easiest to understand step by step: the entire procedure takes place on the single portal formalites.entreprises.gouv.fr, which has been operated by INPI since 2023.
- Create a personal account on the portal and select the type of activity
- Complete the declaration of commencement of activity online
- Indicate the place of business address and bank details
- Wait for assignment of SIREN and SIRET
Registration is free of charge, and processing usually takes from a few days to a month depending on the type of activity and the workload of the authority.
For liberal professions, SIREN is usually assigned within one to seven business days, for trading activity — within three to ten days, and for craft activity — up to several weeks.
Starting your own business in France — documents for a foreigner upon registration
Starting your own business in France is possible for a foreigner with a standard set of documents: identity document, residence permit, proof of address, and bank details.
For certain types of activity — construction, beauty services, catering — proof of qualifications or professional experience is additionally required.
If there is no official address yet, it is permitted to indicate the address of a domiciliation company — a lawful practice used by many newly arrived entrepreneurs.
Translation of documents into French is not always mandatory at the registration stage, but it will be useful later — when opening a bank account or dealing with the tax authority.
SIRET and SIREN — what they are and why they are needed for Auto-entrepreneur activity
SIREN is the nine-digit number of the enterprise itself, while SIRET adds to it the code of the specific place of business; both are assigned automatically after registration.
The SIRET number must be stated on all invoices and documents — without it one can neither issue an invoice to a client nor open a professional bank account.
Upon cessation or suspension of activity, the numbers are not deleted entirely but remain in the INSEE register in archived status in case of future checks.
Separately from SIRET, an APE code is assigned, which defines the main field of activity and is used by statistical and tax authorities.
After receiving the numbers, it is advisable to open a separate bank account for professional activity straight away — this simplifies record-keeping and is mandatory once annual turnover exceeds EUR 10,000.
Taxes in France for Auto-entrepreneurs — how the system works
Taxes in France for Auto-entrepreneurs are assessed on turnover, not on profit — this is the main difference between the simplified regime and ordinary company taxation.
This system is convenient in that it does not require complex bookkeeping: it is enough to record receipts and file the turnover declaration on time.
Types of taxes in France for Auto-entrepreneurs — what and how much to pay
Types of taxes in France for this status amount to social contributions and, if desired, income tax — both calculated as a percentage of turnover.
| Type of activity | Social contributions 2026 | Versement libératoire |
| Sale of goods | 12.3% | 1.0% |
| Services (BIC) | 21.2% | 1.7% |
| Liberal professions (BNC) | 23.2–25.6% | 2.2% |
VAT may be added to these rates if turnover exceeds the exemption threshold — EUR 37,500 for services or EUR 85,000 for trade in 2026.
Separately, from mid-2026 the ACRE relief for new entrepreneurs is reduced — exemption from part of the contributions in the first year has been cut from 50% to 25%.
For liberal professions belonging to the CIPAV fund, a separate higher social contribution rate of 23.2% applies, differing from ordinary BIC-category services.
The exact rate for a specific type of activity should be confirmed upon registration, since the APE code sometimes assigns the same service to different categories depending on the wording.
An error in choosing the APE code at the outset sometimes leads to overpayment of contributions for several months until the entrepreneur notices and files an application for correction.
Versement libératoire — when this option is advantageous and how to activate it
Versement libératoire combines payment of income tax and social contributions into a single payment and is available if the household’s reference income does not exceed the established threshold.
An application to activate the option is submitted through Urssaf by the end of September so that it takes effect from January of the following year.
The option is advantageous for those whose ordinary income tax under the progressive scale would be higher than the fixed percentage, but it removes entitlement to certain tax deductions and benefits.
You may opt out of the versement libératoire each year by the end of September if your situation has changed and the ordinary progressive scale has again become more advantageous.
A simple calculator on the Urssaf website allows you to compare both schemes in advance based on expected turnover and family situation, without waiting until the end of the year.
Auto-entrepreneur social contributions — cotisations sociales
Cotisations sociales cover health insurance, pension and other social rights of the entrepreneur, and their amount depends directly on actual turnover.
If there was no turnover at all, no contributions are charged — unlike in many other countries where the law requires minimum payments regardless of income.
The turnover declaration is filed monthly or quarterly at the entrepreneur’s choice, and the chosen interval affects only the frequency of payments, not their total amount.
Contributions confer entitlement to basic health coverage through the caisse primaire d'assurance maladie and gradually build pension entitlements under the general French system.
In addition to social contributions, a small percentage is withheld separately for vocational training (CFP) and, for certain types of activity, a trade levy.
Micro-entreprise turnover limits — when you need to switch to another regime
Micro-entreprise allows turnover of up to EUR 203,100 per year for trade and up to EUR 83,600 for services and liberal professions.
If the limit is exceeded for two consecutive years, the entrepreneur automatically switches to the ordinary tax regime with standard accounting and recognition of actual expenses.
A one-off excess of the threshold within a single year does not result in immediate loss of status — the law provides a form of transitional period of two consecutive calendar years.
It is useful to estimate expected turnover a year ahead: approaching the limit is a signal to seek advice in good time on switching to another legal form.
What happens to social contributions when turnover is zero
When revenue for the reporting period is zero, the declaration must still be filed, but the contributions payable will be zero — no penalty is provided for this.
Failure to file the declaration itself, even a zero one, usually incurs a penalty, so reporting must be submitted on time regardless of whether there was income.
Prolonged zero turnover — two consecutive years without a single income declaration — may lead to automatic removal from the register of active entrepreneurs.
Temporary suspension of activity is arranged by a separate application on the same portal and allows you to retain status without filing zero declarations every month.
Income tax in France — how it applies to an Auto-entrepreneur
Income tax in France for an Auto-entrepreneur is calculated either through the versement libératoire or in the individual’s overall tax return together with other household income.
In the latter case, turnover is first reduced by a fixed allowance — abattement forfaitaire — and only the remaining amount is added to the household’s other income.
The choice between the two options should be recalculated each year: at low household income the versement libératoire is more advantageous, while at high income the ordinary progressive scale is.
Income tax in France for individuals — progressive scale and rates
Income tax in France for individuals is levied on a progressive scale: 0% up to EUR 11,600, 11% up to EUR 29,579, 30% up to EUR 84,577, then 41% and 45%.
- 71% allowance on turnover for trade in goods
- 50% allowance on turnover for BIC-category services
- 34% allowance on turnover for BNC liberal professions
The rate is not applied to the entire income but in bands — each successive tranche is taxed at its own rate, which reduces the overall tax burden.
The number of family quotient shares directly affects the final amount: a family with children pays less than a sole entrepreneur with the same turnover.
The annual return is filed in the spring of the following year via the personal account on impots.gouv.fr, where Micro-entreprise income appears as a separate line.
Taxes in France for foreigners — tax residence and its consequences
Taxes in France for foreigners depend on tax residence status: a resident declares worldwide income, while a non-resident declares only income from French sources.
An Auto-entrepreneur who works and lives in France on a permanent basis is almost always treated as a tax resident from the first full year of activity.
A non-resident pays tax only on French business income but cannot claim many family and social deductions available to residents.
Resident status also opens access to the universal health insurance system PUMA from the first months of lawful activity in France.
Taxes in France for foreigners — specifics for Ukrainians
Taxes in France for foreigners from Ukraine follow the same general rules, but the interstate double tax treaty is also taken into account.
Knowledge of these nuances is especially important for those who still retain income or assets in Ukraine alongside a business in France.
When a Ukrainian becomes a French tax resident
Residence is determined by several criteria: the family’s main place of residence, presence in France for more than 183 days a year, main professional activity, or the centre of economic interests.
Meeting any one of these conditions is sufficient — all criteria need not be established at the same time.
A change of status often occurs unnoticed by the entrepreneur, so it is worth periodically reviewing your situation, especially when the family relocates.
Official confirmation of status is the attestation de résidence fiscale, which the French tax authority issues on request when needed.
Ukrainian banks or partners often require this document to confirm where exactly the entrepreneur pays tax on their income in the current year.
France–Ukraine double taxation: how to avoid it lawfully
A double tax treaty is in force between Ukraine and France; it determines in which country a particular type of income is taxed.
As a rule, income from a business registered in France is taxed there, and the treaty merely prevents the same income from being taxed again in Ukraine.
If part of the income is nevertheless taxed in both countries, the treaty provides a credit mechanism for tax already paid, rather than a simple second charge of the same amount.
In practice, applying the treaty usually requires a certificate of tax residence and proof of amounts paid — these documents should be kept systematically.
When residence changes during the year, a tax return is sometimes filed in both countries for partial periods — this is a separate procedure that requires care.
Legal assistance when starting a business in France
Registration without standard French documents, tax disputes or a switch to another regime are situations where it is difficult to navigate alone and easy to make mistakes.
Lawyers at International Law Firm "Zahist" help choose between Auto-entrepreneur and other forms, prepare registration documents and support business structuring.
We also help navigate double taxation between Ukraine and France and prepare documents for the treaty where the client still has income in both countries.
- Checking eligibility to register under the current residence permit
- Choosing between the versement libératoire and the ordinary progressive scale
- Preparing documents where French income certificates are unavailable
- Support when switching to another tax regime
Each of these issues is easier to resolve before filing an application than to correct after a refusal or an error in a declaration.
If you plan to register status in France and want to understand the tax burden in advance, contact Mezinárodní advokátní kancelář "Zahist"— we will review your situation in a consultation.
An initial consultation helps choose the optimal format from the outset and avoid overpaying tax or a registration refusal due to formal errors.
We work with clients remotely and in person, so you can obtain advice before moving to France or after starting activity on site.
