Definition
First payment from a client: 2,500 €, the whole amount, with nothing held back.
Someone who used to be an employee, and watched income tax vanish from the payslip before the money ever arrived, looks for the same line and finds none.
Many conclude that a micro-enterprise escapes withholding tax. It does not escape it, it simply pays it another way.
Prélèvement à la source (pay-as-you-earn income tax) is how income tax is paid in France. For an employee, the employer holds the tax back and passes it on.
For a micro-entrepreneur, nobody holds anything back: the tax office itself debits an instalment from your bank account, one it has calculated on its own, monthly by default, or quarterly if you ask for that option in your personal account.
Your clients are never involved: they pay you the full invoice.
What the instalment is calculated on
The instalment is not based on your Turnover, but on the profit the tax office reconstructs from it.
To do so it applies the Standard allowance for your category. In 2026 it is 34% for a liberal activity taxed as BNC.
It is 50% for services taxed as BIC, the industrial and commercial profits category, as well as for classified tourist furnished rentals and bed and breakfasts.
It reaches 71% for the sale of goods and hotel accommodation alone.
The calculation runs in the open. You collect 30,000 € from a liberal activity during 2026, then report it the following spring on Form 2042-C-PRO.
The tax office removes the 34% allowance, that is 10,200 €, and keeps a taxable profit of 19,800 €.
That amount, added to the household's other income, goes through the progressive scale and then becomes the basis for your instalments.
An instalment always mirrors a year already declared: the one leaving your account today was worked out on what you were earning before.
The first-year trap
In your first year, no instalment is taken, because there is no earlier return: the tax office does not yet know your activity exists. Many read that silence as an absence of tax.
The tax on that first year in fact lands after your first return, as a balance to settle, at the very moment the instalments based on it begin.
Two years of tax then arrive within a few months. Set money aside from the first payment you receive, or ask for an instalment yourself in your personal account on impots.gouv.fr.
The same lag works the other way when business slows down: your instalments keep being calculated on a good year now behind you. You can lower them at any time from your personal account.
The tax office reconciles everything after the annual return in any case: anything overpaid comes back to you, anything missing is called in afterwards.
Three levies people mix up
The Flat-rate income tax is not withholding tax, and that is the most common confusion of all.
Under that option you pay your income tax as a percentage of the turnover declared to URSSAF, in 2026 1% for trade, catering and hotel accommodation, 1.7% for BIC services, furnished rentals and bed and breakfasts, and 2.2% for BNC.
Those rates cover income tax alone: social contributions come on top. Tax is settled as you go, so income covered by that option no longer generates any instalment.
It never removes the annual return, and a household with other income keeps its withholding tax on that income: the schedule appears in your personal account.
The conditions and rates of the option are set out on the official page for the micro tax scheme.
Social contributions are not income tax either. They are paid to URSSAF on your turnover, on a rhythm that has nothing to do with tax instalments.
A scheme allowing platforms to withhold contributions directly has also been announced: it is not yet generalised, and URSSAF will set out the details.
The name sounds alike, the subject is entirely different.
Frequently asked questions
Should my clients hold tax back from what they pay me?
No, never. A client pays the full invoice, and you alone remain liable for your income tax.
Withholding by a paying third party applies only to salaries, pensions and replacement income such as unemployment benefit.
I have just registered and nothing is being debited, is that normal?
Yes: the tax office calculates instalments from a past return, and you have not filed one yet.
Nothing leaves your account until that first figure exists, but the tax on this year will still be due once your first return is filed.
My instalment is based on a much better year, can I bring it down?
Yes, you can ask for it at any time in your personal account on impots.gouv.fr, stating the income you expect for the current year.
The figure is recalculated for the remaining due dates, without waiting for the annual reconciliation.
With the versement libératoire, do I still have anything to declare?
Yes. Your turnover goes on form 2042-C-PRO even under that option, in the box reserved for the micro-entrepreneurs concerned.
This entry triggers no second taxation: it feeds the effective rate and the reference tax income.