How To Be An Auto Entrepreneur In France
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You don’t need to have a rich uncle to start and build a business in France. You just need to be bold.
In France, you don't need to have a rich uncle to start and build a business.
There are 5 startup laws in France:
- The Law of Commercialization
- Law of Residence
- TheLaw of Procurement
- Law of Public Assistance
- The Law of Translation
There are also three other laws that pertain to you and your auto business:
- Taxes on Insurance Companies (ESF)
- Tax on Operating Automobiles (ACTA)
- Loss for theft (ASSP)
Legal tips to keep you a step ahead of the others
Here are some tips to keep you a step ahead:
Sell vehicles as an auto entrepreneur
France has a very tight vehicle restriction system which you will need to take advantage of. For instance, you need to enter a yearly agreement with your local prefecture to purchase a set number of vehicles.
You cannot just start selling any vehicles you want, because you would be breaking the law.
You can find a good auto management company in France. The most important thing is to educate yourself on the process before you go into it.
As an auto entrepreneur you have to be honest, truthful and make sure you are not breaking the law.
Stay organized and prepare properly
One of the most important things to remember is to stay organized. You don't want to lose a day because you did not prepare properly.
You have to stay in contact with everyone in the company and you have to ensure that you have all of your operations done and not rely on others to finish your work.
Be safe always
What happens if a gas station or workshop burns down? The laws in France are strict and if you don't have proper insurance, then you could be looking at a huge fine.
If your business is built upon money making vehicles, then you have to take extra precautions.
Start your business with a limited warranty
You can get a limited warranty in France if you are a young business owner. Your limited warranty will run from 90-180 days depending on the product.
Taxes on the vehicles purchased
There are three different types of taxes you can be charged:
- Auto leasing
The taxes are a flat rate per year and you have to pay the taxes all year. Taxes on the vehicles will vary depending on the year the vehicle was imported.
Loss of vehicle or theft
You can lose a vehicle without even realizing it. You just need to file a police report if it's stolen.
If you can find a salvage yard in the area, then you can take your vehicle there to try and recover the money spent on repair costs.
In addition to the above laws, there are three other important things to take into consideration.
- Loss of goods (loss of car)
- Nationalization of debts
- Insure each part of your vehicle
Loss of goods (loss of car)
This is the most expensive and time consuming. When you sell a vehicle in France, you need to have a written statement from the buyer that they have a full and complete warranty.
If the buyer fails to provide this, you can't re-sell the vehicle, even if you get a loan to re-purchase it. The buyer can sue you for the loss of the vehicle even if they are protected by a warranty.
Nationalization of debts
If you get into financial trouble and have a loan in France, the lender will become the owner of your car and you will not be able to sell it. You will have to find a buyer and pay the lender to reclaim their loan.
In addition to all of the laws listed above, there are also more crucial items things to consider.
Homework for private sales
If you do not have a vehicle that is air-conditioned, then you will need to bring an ice machine. Likewise, if you need to move a vehicle, you have to notify your boss and give them 72 hours notice.
If the city decides that the vehicle is a danger to the public, then you can be fined.
VAT on your vehicles purchased
When you buy a vehicle in France, you need to make sure that you do not sell it in the same city that you purchased it. It is quite possible to find an increase in the price of your vehicle because the new taxes have just gone into effect.
You can add about 6% VAT to the price of your vehicle
VAT is also charged on additional accessories you add to your car. The VAT applies to anything that you buy that costs $500 or more. In some cases, the VAT can increase the price by 30% to 50%.