Independents: how to modulate its tax at the source?

That’s it, the withholding tax is in place. Decryption of the consequences of this new system for the independents !

“No bugs! After the unemployed and retirees in late January, no less than 25 million employees discovered their payroll, net of tax. According to Bercy, the withholding tax on income tax (PAS) was “without bugs”. He is now on the rails.

In any case for people who receive a salary, an unemployment benefit or a retirement pension. Because in all these cases, the system is simple. The deduction at source is done by the paying agency (employer, employment center, pension fund).

Payment by monthly or quarterly installment

But by definition, no withholding tax is however possible when it comes to non-wage income (trader, craftsman, annuitant, farmer, liberal profession …). For these resources, the SAP is more complex because the tax administration must take a direct deposit, monthly or quarterly, on the taxpayer’s bank account.

When we talk about the self-employed, we consider people who receive industrial and commercial (BIC), non-commercial (BNC) or agricultural (BA) profits. The same is true of general insurance agents and taxpayers who collect royalties.

The remuneration paid to the majority managers of Sarl is subject to the social contributions of non-employees but imposed in the category of salaries and wages. They are also concerned by the decryption payment .

Only micro-entrepreneurs who have opted for the payment of income tax are exempt from payment of the deposit.

All these independents must pay an income tax installment. Payment is made by monthly levy or quarterlyfrom their personal current account.

To define the amount, two periods must be distinguished.

From January 2019 to August 2019, the amount is calculated on the income earned in 2017.

From September 2019, the deposit will be adjusted according to the tax return that you will fill in April May 2019.

In the particular case of a company created in 2019 , the tax will be levied at one time in 2020. But, you can already smooth your cash flow by spreading this payment as early as 2019. Just ask for setting up an estimated deposit.

Another special case: you close your activity in 2019. In this case, you can ask to interrupt the payment of installments .

Taxation of exceptional income

Regarding 2018 revenues , they will all be erased by the mechanism of the Modernization of Recovery Tax Credit (CIMR). All? Not quite. Revenues considered exceptional will be taxed.

For independents , the Fisc will verify if your 2018 revenues are higher than those of previous years (2015, 2016 and 2017). If so, your 2018 result is considered exceptional, equal to the difference between the latter and the highest profit of the previous years.

The only solution to avoid this: to justify that your result 2018 comes from an increase in activity and not an optimization of your remuneration.

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