Portage salarial company salary calculation

Every professional activity generates expenses, either from commercial prospection, professional trips or simple your internet billing. In contrary to micro-entrepreneurship, all professional expenses can be included in your final salary as expense reports.

There are two ways we can define professional expenses in umbrella companies. There are expenses linked to your mission with a client, and the expenses linked to your freelance activity.

Professional expenses linked to my freelance activity

These expenses involve all the bills and charges that are directly linked to my independent company as a freelancing consultant, these are not invoiced to my client, but you can still claim your money back as they are business expenses. These expenses under certain conditions are not taxed. The reimbursement of overheads is regulated by URSSAF, with strict rules and should not exceed 30% of your gross salary.

These expenses can result in extra income on your monthly salary and you should not hesitate to include them in your calculations.

A few examples of expenses linked to your freelancing activity:

• Mobile or internet bills (professional mobile, ADSL)
• Your communication expenses (LinkedIn Premium account, domain name for your website)
• Coworking spaces
• Stationary expenses (flyers, pens, paper) for small amounts
• Your professional prospection to obtain new clients (you need to fly to your client’s office to meet him in person)

Professional expenses during your mission

Contrary to your activity expenses, mission expenses don’t have a limit and you fully get those expenses back.

Mission expenses include all the spending you’re going to have to negotiate with your client in addition to your actual consultancy fee, these must be stipulated in your commercial contract.

All expense reports must be forwarded to your client, unless you have established a bundle fixed price.

Here are a few examples of mission expenses:

• Travel expenses (train, plane, taxis, uber etc.)
• Mile counts (if you use your own personal car)
• Meal expenses
• Accommodation fees (hotels, if you must travel far from home)

Declaring your professional expenses to your portage salarial company

Every month you have to declare your professional expenses to your portage salarial company. You must send in your expense reports with dates and originals to your HR representative or via your online personal account. Ad’missions has the legal right to deny some expenses if they present a legal or social risk to the company. Your human resources counsellor will check them every month.

Don’t hesitate to compare different salary simulations with or without expenses to see the differences in your net income.

In France since January 2019, revenue taxes are directly taken from the source (from your monthly salary). In umbrella companies, it works the same way as regular employee contracts. Every month, the administration communicates your tax rate to the portage salarial company. This rate will be applied on your monthly income.

How does it work?

Tax at source, as it clearly states, is taxes directly taken from the source of your income every month. The payment of your taxes is now done over 12 months. Every spring you still have to declare your annual revenue from the previous year. This lets the administration adapt your tax rate and communicate it to your portage salarial company. This rate is calculated on the declaration of your yearly income, your deductible charges, the members of your family, situation changes or any expenses that are open to tax deductions.

Your tax rate can be different:

• Personalized tax rate:

The personalized tax rate is applied automatically to your income and is calculated by the administration every after your annual tax declaration. It is personalized because it is calculated from data that you have given to the state about your income and family status. For example: your personalized rate for September 2020 will be based on your income for the year 2019. You can adapt your personalized rate on your online account “Gérer mon prélèvement à la source” at impots.gouv.fr.

• Neutral tax rate:

The neutral tax rate is applied when your personalized tax rate is unknown from the administration and has not been transferred to your portage salarial company. You can also choose not to communicate your personalized rate; your employer will then apply a neutral tax rate to your salary. Be warned that neutral tax rates are usually a bit higher than your personalized tax rate.

You can also not be taxable; your portage salarial company will then apply a neutral tax rate of 0% on your monthly salary.

What is the role of your portage salarial company?

Your portage salarial company in this case is your employer and does not intervene in the management of your taxes. Therefore, with your human resources counsellor, he/she can help you in your approaches.

All approaches linked to your income tax, how to change your personalized rate, changing your marital situation or any other information can be done on your online account at www.impots.gouv.fr.

Two types of contracts in portage salarial companies

When you start working with a portage salarial company, you have to define the type of contract, either CDD, which is a contract with a determined end date, or a CDI which is a contract with an undetermined end date. These contracts determine the working conditions. As soon as it is signed, the consultant can start his mission with the client. There are different specificities between the two contracts, the CDD can’t exceed 18 months and the CDI cannot exceed 36 months with the same client.

Contract with a determined end date

The CDD (as it is called in France), has a few different specificities through umbrella companies:

• It includes payment conditions
• The expertise and skills of the consultant
• And details of the services offered by the consultant

Contract with an undetermined end date

The CDI in portage salarial companies is no different than a classic contract between an employer and an employee. Therefore, certain clauses allow for consultants to follow educational courses. Contrary to the original CDI, in portage salarial companies, it does not mention salary amounts and only mentions the salary instalments of the consultant.

There are a few differences between the CDI and the CDD in portage salairal companies, there is no subordination between the employer (umbrella company) and the consultant. The portage salarial company does have the right to look into the negotiated services provided by the consultant, they can also make you recommendations. Every month, the consultant must send in a monthly activity report, that must be signed by the client, this will enable your salary, the consultant can access this report directly on his online account.