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Declaration of Spouse in a French Business

Monday 08 October 2018

Sanctions are to be tightened against business owners who do not declare that their spouse works for the business.

Although currently business owners are obliged to declare a working spouse (or civil partner), according to the government around one third of owners fail to do so.

As a result, the level of social protection afforded to the spouse in the event of death of the owner or divorce is substantially reduced.

If the spouse is not registered with the business they are only entitled to the most basic pension rights, and there is no protection for them in the event of accident at work. Most of those affected are women.

Perhaps just as importantly for the government, if the spouse is not declared they do not pay social security contributions, so there is a loss to public revenues.

In order to reinforce the obligation of declaration, the business registration process is to be changed so that a business owner must explicitly state whether the spouse will be working on a regular basis in the business.
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Until now, where the authorities have discovered that an undeclared spouse works for the business, the owner has been entitled to re-qualify them as a partner.

In future, if they fail to declare a working spouse, the spouse will retrospectively be considered a salaried employee, a status that would have significant social security costs and legal implications for the business.

In addition, the penalties for non-declaration will be reinforced.

The rule on declaration of the spouse only applies where they have a 'regular' role in the business, a definition that does not depend entirely on the number of hours/days worked by the spouse, but whether they play a direct, tangible part on an habitual basis.

Where the business is run using micro-entrepreneur tax status the spouse can be declared as a conjoint collaborateur and pay a lower level of social security contributions. There is no need for them to have business separate registration.

You can read more about the status of a spouse in a small business our Guide to Micro-Entrepreneur Business in France.

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