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Status of the company
Micro and sole proprietorship: understanding the distinction
Publié le 16 juillet 2026 - Entreprendre Public Service / Directorate of Legal and Administrative Information (Prime Minister)
Micro-enterprise and sole proprietorship can often be confused. They share the same legal form since a micro-enterprise is the lighter version of a sole proprietorship: it benefits from a simplified social and tax regime. Undertake Public Service explains.
The sole proprietorship and the micro-enterprise allow to carry out an activity in their own name. Their formalities of creation and management are simpler than for a company.
There is no such thing no difference in legal status between these two entities since the micro-enterprise is a sole proprietorship whose rules have been relaxed: it is thus differentiated by its simplified tax and social system.
Please note
The micro-enterprise is subject to annual turnover ceilings. If these thresholds are exceeded, the entrepreneur switches to the traditional regime of the sole proprietorship.
Social system
The first distinction concerns the method of calculating social security contributions.
The micro-enterprise benefits from micro-social regime : its social security contributions are calculated using a percentage of its turnover. Thus, if its turnover is zero, then no contribution is due. The contribution rate applied varies according to the nature of the activity.
The classic sole proprietorship falls under the social security scheme for self-employed persons integrated into the general scheme. During the first two years of activity, his contributions are calculated, provisionally, on flat-rate basis corresponding to 19% of the annual Social Security ceiling (PASS), i.e. €9,131 in 2026. The individual contractor does not pay any contributions for the first 3 months, or 90 days. The contributions are then calculated directly on its net profit.
The individual entrepreneur must also pay a minimum amount of social security contributions, even in the absence of turnover.
Tax system
The tax system is the other major distinction between micro and sole proprietorship.
Micro-enterprise is under the micro-fiscal regime. This system consists, in particular, in calculating income tax, in deducting expenses by means of a flat-rate abatementand not according to their actual amount.
It is imposed by default according to a withholding tax mechanism, but may also opt, under certain conditions, for the payment of income tax.
Conversely, the sole proprietorship is automatically subject to a actual income tax system (normal or simplified). It is thus taxed on its actual profit, after deduction of the expenses actually borne by the undertaking.
Finally, the individual entrepreneur can also opt for corporation tax.