In the life of a micro-enterprise, in addition to the core business, there's the management of quotations, invoices, bookkeeping, sales declarations... and the moment of tax declaration, which crystallizes a lot of questions. One such question comes up regularly: what impact does marriage have on a micro-entrepreneur's tax return? Or conversely, what is the impact on the joint tax return of sums received under the micro-business regime? Let's take a look at the consequences of being a married micro-entrepreneur when it comes to declaring your taxes.
The basic tax regime for micro-entrepreneurs
As sole traders, micro-entrepreneurs are not subject to corporation tax, but to income tax (IR). Sales are therefore taken into account when calculating the average tax rate, in the same way as the taxpayer's other income: salaries, unemployment benefits, retirement pensions, etc.
The tax calculation for auto-entrepreneurs depends on several factors.
Flat-rate allowance for professional expenses
The micro-tax system is automatically assigned when the micro-enterprise is registered. Unlike other types of status, it is not possible to deduct expenses or equipment purchases from sales. In return, the tax authorities grant a flat-rate allowance, which varies according to the nature of the activity, to cover professional expenses. It should be noted that it is possible to opt out of the micro-enterprise tax regime, in particular to deduct actual expenses. In this case, it's a matter of deciding what is most advantageous.
The micro-business tax regime covers two main categories of profit: BIC and BNC. A distinction is also made between sales activities and the provision of services. The flat-rate allowance rates are as follows:
- In industrial and commercial profits (BIC), 71% of sales are deducted for sales activities.
- For industrial and commercial profits (BIC), the allowance is 50% for activities involving the provision of craft and commercial services.
- For non-commercial profits (BNC), the flat-rate deduction is 34% of sales for the liberal professions and non-commercial services.
To qualify for the micro-tax regime, businesses must meet annual sales thresholds determined by type of activity.
The family quotient
After applying the flat-rate sales allowance, the tax authorities add the sum obtained to other taxable income. Then, based on the composition of the household, the tax department determines the family quotient (QF ).
The number of shares is used to adapt the amount of tax to the taxpayer's personal situation and any family responsibilities. Single, civil union, marriage, number of dependent children or disabled children... These data are taken into account when taxing the sales of a micro-business.
The main effect of marriage on micro-entrepreneurs' taxes is that they form a tax household. Filing a joint tax return and combining income as a married couple can therefore increase or decrease the tax bracket.
Two auto-entrepreneurs with the same activity and the same taxable income will therefore not necessarily pay the same amount if they are single or married. Similarly, married couples with or without dependent children pay different shares.
The income of the whole household is added together, then divided by the number of family quotient units. The tax authorities then apply a progressive scale by bracket.
Another option for married couples: payment in full discharge
This is a specific option for micro-businesses, but similar to withholding tax. By choosing this option, micro-entrepreneurs pay their taxes when they file their monthly or quarterly sales declarations.
The advance payments levied are based on a percentage of sales declared to Urssaf, according to the nature of the business:
- 1% for sales or accommodation services
- 1.7% for BIC service activities
- 2.2% for services or self-employed activities falling under the BNC tax regime
The payment is final and non-refundable. This system is particularly attractive for tax households that pay income tax under the traditional system. However, to qualify, reference tax income for the year N-2 must not exceed a certain threshold.
Micro-business and marriage: how do you file your tax return?
In the year following a marriage or civil partnership, spouses or partners file their tax returns together. This can be done directly via the online personal space of one of the spouses. Information such as the date of the event, the partner's tax number and marital status must be provided.
Even if you have opted for payment in full discharge, you are still required to declare your income from your micro-business. This is done on the joint tax return, using form 2042 C Pro "Déclaration de revenus complémentaires des professions non salariées". The gross annual sales figure is indicated as BIC and/or BNC, depending on the case, along with any capital gains or losses for the year.
Good to know: for the year of marriage or civil partnership, it is still possible to file a separate tax return with an irrevocable option.