Establishment of « maison d’hôtes »
Many English people set up very small businesses in France. A common one is a bed and breakfast business or “chambre d’hôtes”. This article summarises the main French formalities.
1. Registration at the Mairie
According to the article L. 324-4 of the French tourism code, before opening a bed and breakfast activity you must register at the local Mairie. Failure to declare can result in a penalty of 450€.
Your registration has to specify:
The identification of your place of residence,
The number of rented rooms,
The maximum number of people who can be accomodated,
The planned periods when you will be open for business.
2. Registration at the chamber of commerce
Where the activity of a guest house is exercised “habitually”, it is deemed to be a commercial activity.
You have to register at the Registry of Companies (RCS) and the Center of Formalities of Companies (CFE), which costs between 26,68€ to 41,50€. Failure to comply exposes
you to a 4.500€ fine and 6 months of imprisonment.
3. Membership to the Social Security
If your taxable income exceeds 5.165€, you must be affiliated to the social security as a non-salaried workers (TNS).
In case of a lower income, there is no obligation to join. The income generated by the business is then subjected to Social Security contributions on the income at the global rate of 17,2%.
The income will be taxed as follows:
When the activity of a guest house is exercised habitually income tax will be due (except if the income is lower than 760€),
You have to collect VAT at the rate of 10%, charged to your customers,
Territorial Economic Contribution (CET), based only on the rental value of properties subject to the land tax. This tax is due in every municipality where a bed and breakfast activity is carried on.
If television sets are present in rooms, you will must pay a “contribution to the public broadcasting” between 90€ to 139€.
Tourist tax on tourist hosting. If the bed and breakfast is situated in a “tourist municipality” where the tax is levied. The price must be posted in the bed and breakfast and is about 0.80€/person and per night.
Housing tax and land tax: Housing tax applies to premises rented because they are a part of your personal house. Land tax applies, because you are the owner of the house. These two taxes vary according to location.