Taxation

It allows the state to fund public services (health, education, infrastructure...).

For the entrepreneur, understanding taxation is essential to:

• Avoid penalties and sanctions
• Manage cash flow correctly
• Choose the most suitable tax regime for the activity

Main types of taxes

Depending on the legal form and the chosen regime, a business may be subject to different taxes:

• Personal income tax (IR)
• Applies to individuals
• Based on income or revenue
• Applicable in particular to self-employed and sole proprietorships
• Corporate income tax (IS)
• Applies to companies (SARL, SAS, SASU...)
• Calculated on company profits

Value Added Tax (VAT)

• Indirect tax paid by the final customer
• The company acts as an intermediary between the customer and the state

There are several tax regimes:

The tax regime is based on several criteria:

• Legal status
• Revenue
• Nature of the activity (commercial, craft, liberal)

Main regimes include:

• Simplified regime
• Standard regime
• Specific regime (self-employed)

Each regime imposes different rules regarding reporting and payment.

Understanding VAT

VAT is one of the most important tax elements.

• VAT collected
• VAT invoiced to customers on sales or services
• Deductible VAT
• VAT paid on business purchases
• VAT payable

Collected VAT - Deductible VAT

• Some activities or statuses may be exempt from VAT under conditions.