As promised in my last blog post about surviving as a freelancer in France, I’m going to look at some of administrative pitfalls you may trip into and how to avoid them, or at least get a little less stressed.
The administrative jungle
The auto-entrepreneur status is a dream come for anyone, like me, who can’t think of anything duller than spending hours doing paperwork. However, the moment you move beyond this income-restrictive entrepreneurial bubble, you’ll quickly find yourself in an unforgiving jungle of organisations, organisms and obligations.
A rocky start
I admit that I may not have done excessive amounts of research when creating my new freelance status, but, by taking on the services of a friend-of-a-friend accountant, I thought that it would be plain sailing. I couldn’t have been more wrong. Everything that could go wrong did go wrong. I wouldn’t like to say to what extent this was my own fault, that of my blasé accountant or the French system that seems intent on making life difficult for freelancers.
All for one, and one for all?
Logically, there would be one organism looking after freelancers, their healthcare, retirement and social contributions. But, no, there are of three them and they don’t seem to communicate with each other, at all. Any information needs to be sent to each one separately and sometimes more than once. Part of the problem seems to have derived from the fact I changed statuses rather than starting from scratch, but this doesn’t make my temporary administrative “inexistence” any less infuriating.
Out of sync
Even in the best-case scenario, there is a two-year delay in readjusting your social contributions based on what you actually earned – you will pay contributions for your earnings in 2015 in…2017! So, make sure you set plenty of money aside – your bank manager might be happy, but you probably aren’t as rich as you think. This can create BIG problems you earn a lot one year and a lot less the following year(s).
A new string to your bow
Now let’s get serious and talk about your accounts. Yes, you can do your own accountancy – this is without doubt cheaper but also time consuming and increases the likelihood of making mistakes. Having said this, if you go for the do-it-yourself option, your AGA (Association de Gestion Agréée) will check your accounts for you before sending them off. You would obviously need to take some kind of accountancy course first – it’s worth checking whether these provided by your AGA.
How to avoid paying 25% more tax
This is very important.
Make sure that you become a member of an AGA, otherwise you will be taxed on 125% of what you earn. Yes, the government have found a clever way to make sure people don’t fiddle their taxes too much by penalising anyone who doesn’t sign up to a state-controlled AGA.
Finding Mrs or Mrs Right
I would highly recommend getting an accountant. Not only do they save you lots of time, they can also give you plenty of advice about what to do & not to do. It can be hard to find the ideal candidate. After a disappointing (& costly) first choice, I recently changed to a small accountancy firm that works exclusively with freelancers like me. So far, so good.
Admin & beyond
Never fear, even if you get an accountant, you’ll still have plenty of admin to keep you busy. Remember to keep all your receipts and make copies – my professional bank account is linked to an app that records all the any in-goings and outgoings. I simply have to add photos or scans of the relevant docs. If in doubt, make a note of it and, I’m sure you don’t need to be reminded, keep on top of your invoices and any delays in being paid! And, last but not least, remember to declare any payments from clients within the EU at: https://pro.douane.gouv.fr
Phew! My rant about French administration has come to an end. And, I haven’t even touched on issues such as choosing your freelance status. The moral of this story? As a freelancer in France you may be FREE from the constraints of being an employee…
But, you aren’t FREE from hours of administrative tasks and paperwork!
Do you have any advice to share? Need answers to your questions about freelancing in France? Please do get in touch.