Business owners who use profit and loss accounting (régime réel) pay several social insurance charges (cotisations sociales) as a percentage of their net profits.
This distinguishes them from micro-entrepreneurs, who pay a single fixed percentage of their turnover. We reported on the changes affecting the social insurance charges of some micro-entrepreneur business owners
From 2025, a major reform will transform the way company owners contributions are calculated, with the aim of simplifying the current system while improving pension rights. The changes are said to be tax neutral in terms of the total contributions payable.
The current contribution system has two separate calculation bases: one for the social charges 'CSG-CRDS' based on professional income and compulsory social security contributions (which are reintegrated into net income), and the other for social security contributions themselves (sickness and maternity, retirement, family allowances, etc.), calculated on net taxable income.
This complexity is often confusing and it can hinder the legibility of pension rights. The level of CSG-CRDS contributions is also higher than that paid by salaried workers.
The changes for next year will reduce the amount of the CSG-CRDS (which does not generate social rights), and increase social contributions, which in turn increase, in particular, pension rights.
The 2025 reform introduces a single base principle for the social contributions using professional income only as the basis for the calculation.
In future, a 26% allowance will be applied to the professional income for the calculation of the social charges CSG-CRDS. Conversely, there will be an increase in the contribution for pensions.
Where previously an owner paid 9.7% CSG-CRDS on their professional income, plus social security charges, in 2025 it will only be on their professional income, with an abatement of 26%, and a minimum and a maximum amount payable, irrespective of income.
Charges for sickness and invalidity will depend on income, starting at 0% for those on the lowest incomes, up to 6.5%.
Pension contributions will be around 26%, as opposed to the current circa 25%. There are slight variations for certain 'liberal' professions.
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