C. THE LEVY AT SOURCE OF INCOME TAX BY THE PLATFORMS: NOT A VIABLE SOLUTION AT THIS STAGE
1. The reform providing for a levy at source of income tax has no effect on the proposed mechanism
The levy at source of income tax , provided for by Article 60 of the 2017 Finance Act 76 ( * ) and whose application is, under current law, scheduled to begin on 1 January 2018, is neutral for the proposed mechanism .
Indeed, unlike the income tax due on salaries, pensions and replacement income, the tax due for self-employed activities or real estate income cannot be collected by third parties and must, therefore, be paid according to specific procedures. The income tax for the current year will therefore be paid in instalments, calculated by the authorities on the basis of the income of the previous year 77 ( * ) , and paid monthly or quarterly by direct debit on the taxpayer's bank account.
In this context, the income received through online platforms is no different nor does it require any specific treatment compared to other income from independent activities or real estate income. Once paid by the platform to the users bank account, it would be directly debited, calculated on the basis of all the income from self-employed professions (after the application of the fixed tax-free allowance of EUR 3,000 on the part of this income derived via platforms).
The only particularity, of very limited scope, could be the greater variability of income derived from online platforms, if they are for sideline or occasional activities (rental of a car etc.). This could lead the taxpayer to requesting a change in the amount of his instalments more often 78 ( * ) , provided for in the reform, but since it concerns sideline income, it is by no means certain that this would be necessary. With regard to the professionals present on online platforms, for example private hire drivers or self-employed workers present on platforms such as Hopwork or Stootie , the reform adopted last year would have no impact on them.
2. Using platforms as collectors of tax instalments: not such a good idea
It is true that the use by a self-employed worker of an online platform introduces a specific situation: the presence of an intermediary between the seller and the buyer, which offers a contact service but very often, a payment service too.
Since the operator of the online platform offer knows, in real time and to the nearest euro , the amount of gross income paid to the user, that it must moreover send him of in the form of an annual summary (Article 242 bis of the General Tax Code) and soon report to the tax authorities, it could be envisaged to entrust it, also, with the levy at source of income tax .
This solution, discussed several times during the Working Groups hearings, however, does not appear to be appropriate:
- firstly , were it the case that the platforms had to apply a tax rate, they could not however determine whether the taxpayer has crossed the EUR 3,000 threshold , and, when he has crossed it, given the possibility that an activity can be undertaken on several platforms. The amount of the tax depends however on the application of this tax-free allowance 79 ( * ) ;
- secondly, in the case of opting for the real charged benefits tax regime instead of the micro-tax regime , this would amount to the platform deducting the amount of the expenses incurred by the taxpayer, which adds further complexity;
- thirdly, the levy at source could result in many mistakes due to the characteristics of the collaborative economy, for example the tax being levied on income in fact derived from a second-hand sale or cost-sharing;
- fourthly, an in particular, automatic reporting already offers very high reliability: the risks of fraud are extremely low , for a mechanism that is much less intrusive, costly and complex to implement.
For all these reasons, it would appear that automatic reporting of income is preferable to collecting income tax at source .
3. One exception: the payment in discharge of income tax by micro-entrepreneurs
That said, the levy at source of income tax by the platforms would be technically possible in one case: that of micro-entrepreneurs who have opted for the payment in discharge of income tax , and have authorised the platform to levy at source the amount of social contributions, in accordance with the reporting system and automatic levy created by the Social Security Financing Act for 2017 (see above). Since income tax in this case is paid at the same time as social contributions, at a fixed rate of 1% (BIC goods), 1.7% (BIC services) or 2.2% (BNC services), this operation does not technically pose any problem, and represents a service for the user .
Conversely, the fact that the law does not currently include this possibility actually deprives micro-entrepreneurs present on online platforms from choosing both the automatic levy and the levy in discharge. The Working Groups proposal therefore meets a simplification objective .
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Proposal No. 9 For users under micro-entrepreneur status, and with their agreement, allow the platforms to collect not only social contributions, but also the flat tax discharging the payment of income tax. |
Should the income derived from the economy collaborative be subject to a fixed levy in discharge, collection at source by the platforms would become possible. That said, for the reasons set out above, linked to the constitutional principle of equality before taxation, the Working Group has ruled out this solution.
* 76 Article 60 of the Amending Finances Act No. 2016-1917 for 2017 of 29 December 2016.
* 77 More specifically, the amount of the instalment for year N will be calculated in September of year N-1, on the basis of the income of year N-2 reported in the spring of year N-1.
* 78 In the event of a change of situation leading to a significant foreseeable variation in the tax, the taxpayer may, if he wishes, request on impots.gouv.fr a change in the amount of the instalment in the course of the year.
* 79 It should be noted that this problem would arise even if the Working Groups proposal were not adopted because there is already a fixed tax-free allowance of EUR 305 under the micro-tax system. Since the income from collaborative platforms is often of a modest amount, it would not be prudent to assume that this threshold is systematically crossed.