If you are freelancing or consulting in France, this is usually the first real decision you face, and unlike the SAS-vs-SARL choice for larger ventures, it genuinely depends on how much you expect to earn and how you want to be covered socially.
Revenue ceilings: the hard limit that decides everything
Micro-entreprise (the regime auto-entrepreneurs operate under) caps annual revenue at €203,100 for sales activities or €83,600 for services (2026 limits), which covers most consultants and freelancers. A SASU has no legal revenue ceiling at all; it can scale to millions without a change of structure. If you are confident you will stay under the services threshold for the foreseeable future, this alone does not force your hand, but if you expect to grow past it, starting as a SASU avoids a disruptive conversion later.
Social charges and coverage: flat-rate simplicity vs. full employee-style protection
Auto-entrepreneurs pay flat-rate social charges of 12.3% of revenue for sales, 21.2% for commercial services and about 25.6% for liberal professions (2026 rates): simple, predictable, and low when you are just starting out. A SASU president who takes a salary is instead affiliated with the general Social Security regime, with coverage equivalent to a salaried employee: health insurance, maternity/paternity cover, and AGIRC-ARRCO complementary pension. That coverage costs more in contributions but is meaningfully better if you plan to rely on it long-term.
Tax treatment
Micro-entreprise uses a simplified system: a standard deduction (71%, 50%, or 34% depending on activity type) is applied before your remaining income is taxed, no real expense tracking required, but also no way to deduct actual costs above that flat rate. A SASU is subject to corporate tax (15% reduced rate up to €42,500 profit, 25% above; see our guide to French corporate tax) and lets you deduct real business expenses in full.
VAT: a threshold that catches people off guard
For 2026, VAT registration thresholds sit at €85,000 (standard) / €93,500 (increased) for sales, and €37,500 (standard) / €41,250 (increased) for services. Below these, micro-entrepreneurs neither charge VAT nor recover it on their own purchases, which is simple, but means you cannot reclaim VAT on business expenses like equipment or software either.
Setup speed: not a small factor
Declaring a micro-entreprise activity is fast and simple, often the same process, done in a single sitting. Setting up a SASU is a genuine company incorporation: bylaws, share capital deposit, registration through the Guichet Unique (see our company formation guide). More paperwork, but the structure you will likely want anyway once revenue grows.
What happens when a micro-entrepreneur crosses a limit
The two limits do not work the same way.
- Revenue ceiling. Going over once does not end the regime. You leave it only if you exceed the ceiling for 2 years in a row. The change then takes effect on 1 January of the year after the second year.
- VAT. If you pass the standard threshold, you charge VAT from 1 January of the following year. If you pass the increased threshold, you charge VAT from the first day you go over it. There is no grace period.
While you are below the VAT thresholds, every invoice must carry the line "TVA non applicable - article 293 B du CGI".
Three micro-entreprise details to set up early
- Income tax paid with your contributions. With the "versement libératoire" option, you pay income tax as a share of revenue at each declaration: 1% for sales, 1.7% for commercial services, 2.2% for liberal professions. It is open only if your household's reference income of two years earlier is under a limit (€29,579 for a single person). A new business must opt before the end of the third month after the month it starts. Otherwise the deadline is 30 September for the following year.
- ACRE. This start-up reduction on social charges is not automatic. It is reserved for certain profiles, such as jobseekers and people aged 18 to 25. You must apply to Urssaf within 60 days of your start date. The reduced rate is 75% of the normal rate, until the end of the third calendar quarter after the one you start in.
- CFE. This local business tax is not due for the year you start. You still have to file form 1447-C-SD by 31 December of that year. Later, you are exempt when your revenue for the reference year was €5,000 or less.
Two things to know about a SASU president
A SASU president is treated like an employee for Social Security, with one exception: there is no unemployment insurance. Private cover can be bought separately.
Dividends are another way to take money out. An individual shareholder pays a flat 31.4% on them: 12.8% income tax and 18.6% social levies. You can choose the progressive income tax scale instead, with a 40% allowance, on your yearly tax return.
Our honest take
If you are testing a freelance idea, expect to stay under the services threshold, and do not need employee-style social coverage, micro-entreprise is the pragmatic starting point. If you are already confident in steady, growing revenue, want real expense deductions, or want the social protection of a salaried-style regime, starting directly with a SASU avoids paying for a conversion later.