Working as a contractor in France
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Mise à jour le 4 février 2020
Independent contractors wishing to work in France must be legally registered. A portage salarial company is a third party supplier acting as an employer for contractors and freelancers. Contractors can carry out their assignments without having to set up a business.
A portage salarial company is particularly suited for a wide range of activities such as IT, consulting, coaching, marketing and other related activities.
What is a Portage salarial company ?
A portage salarial company is very much like a UK umbrella company. It acts as an employer for freelancers and contractors. A client engages with the portage salarial company rather than directly with a contractor.
As a contractor you become an employee of the portage salarial company and will be authorized to carry out a number of temporary contracts without the need to manage your own payroll.
How does a Portage salarial company work in practice ?
Here is the portage salarial process in 7 simple steps.
1. Once the contractor has secured an assignment in France and agreed on its price and duration, he or she can sign an employment contract with a portage salarial company.
2. The portage salarial company then signs a service contract with the client on the contractor’s behalf.
3. The contractor carries out an assignment for the client based on the terms of the service contract.
4. Every month, the contractor submits a timesheet signed by the client to the Portage salarial company with the number of working days /hours. The contractor can also claim a refund for business expenses. Each business expense is duly checked by the portage salarial to ensure legal compliance.
5. The Portage salarial company invoices the client based on the submitted timesheet. The Portage salarial company receives payment from the client.
5. The Portage salarial company deducts taxes and contributions from the contractor’s revenues.
6. The portage salarial company prepares the contractor’s payroll and pays a monthly salary after deductions of management fees, employment taxes and pension contributions . Any validated business expense is paid with the contractor’s salary. The Portage salarial company provides the contractor with a fully detailed payslip.
What are the benefits of working as a portage salarial employee ?
As a contractor, there are many advantages to working with a Portage salarial company :
- It is very easy to use. All you need to do is submit your timesheet and expenses and wait to get paid, the portage salarial company will take care of all the paperwork for you.
- You can claim for work related expense refunds. These are paid free of tax which will increase your take home pay.
- You have access to many benefits such as the French national health care and pension scheme. The French social security system is one of the most generous in the world. You gain professional independence with all the benefits of being an employee.
How does a Portage salarial company get paid ?
A portage salarial company will charge management fees between five to ten percent of the total amount of invoices processed each month.
What taxes do I have to pay ?
There are two main types of personal taxes in France: social security contributions and income taxes.
Social security contributions are deducted by your Portage salarial company from the income you earn. You do not need to estimate these contributions as your Portage salarial company will do the work for you. If you do not receive a salary, no social contributions will be charged.
If you are not a tax resident in France, you only pay taxes on income from French sources. If you are a tax resident in France, your must pat your taxes on your worldwide income. However, international tax treaties may provide for specific arrangements.
You will be regarded as a tax resident if you meet one of the following criteria :
- Your main residence is in France.
- The core of your financial and personal interests is in France.
- You spend in France more than 183 per calendar year.
Since 2019, income taxes are now deducted at source from your wages. It will thus be paid by your Portage salarial company directly to the French IRS.