What Is The Retrocession Of Fees?
If you are just settling in as a liberal profession, you may not have thought about vacation, maternity leave or sick leave yet. However, you will need to take a break from time to time, it is possible if you are a woman that you get pregnant, and you and everyone else will get sick.
In the event that you are temporarily unable to exercise – one is thinking of doctors in particular – you will no doubt want your patients to continue to be monitored. You will therefore have to be replaced by a colleague. During your absence, you will continue to collect receipts, and will have to pay him a part in the form of fees in return for the service rendered. This is called the retrocession of fees.
This accounting operation is provided for in the General Tax Code, in which the following definition can be read: ” retrocessions of fees or receipts the sums transferred by a member of a liberal profession, on his own initiative and in the within the framework of the mission entrusted to him by his client, either to a colleague or to another person exercising a liberal profession complementary to his own . “
Retrocession Of Fees: Who Are The Professionals Concerned?
If we often cite doctors as an example, the retrocession of fees applies to all liberal professionals who declare BNC (non-commercial profits): lawyers, veterinarians, architects, nurses, etc. are also concerned.
You are a lawyer: you may need to delegate some of your work to a colleague who is more knowledgeable on a particular subject. As in the case of the substitute doctor, you will collect your client’s income, and will have to pay part of it to the colleague who came to your aid.
Retrocession Of Fees And Subcontracting, Why Is It Different?
Be careful not to confuse the retrocession of fees and subcontracting: these are two very different things, especially with regard to the tax administration. Indeed, where retrocessions of fees are considered as deductible charges, and whatever the tax regime to which the professional is subject, subcontracting is not so for certain liberal, and in particular, the auto -entrepreneurs subject to the micro BNC regime who exercise an unregulated profession, and who will have to pay tax on the amount subcontracted.
In the event that a dentist has a dental prosthesis manufactured by a liberal professional who declares BIC (industrial and commercial profits) and not BNC, it is considered that it is not a question of retrocession of fees – the latter does not operating only between professionals imposed in the category of BNC – but subcontracting.
Another example: if as a private nurse you delegate the management of your accounts to a private accountant, this is again a matter of subcontracting, the mission not having been entrusted to it by a client but by you. Moreover, the chartered accountant is not your colleague, and chartered accountancy is not considered as a complementary profession to yours.
Retrocession Of Fees And Rental Of Equipment, Why Is It Different?
This is something that is done a lot: reserve part of its income for a colleague in return for the use of its premises. This is referred to as the rental of equipment and / or clients – in medical jargon, we also say “ chair rental ” – which should not be confused with the retrocession of fees. Here again, the rental of equipment is not considered a deductible expense for liberal professionals subject to the micro BNC regime.
The common thread between outsourcing and equipment rental is that in both cases, the two parties are bound by a contract – either as a subcontractor or as an equipment rental. Thus, if you are a speech therapist and you use a colleague’s premises to receive patients, you will only be able to do so after having concluded a rental contract with him, and you will have to pay him part of your turnover. Business registered for the exercise of your activity on its premises.
Accounting For Retrocessions Of Fees, Instructions For Use
The calculation is simple: the retrocessions of fees must simply be deducted from the total fees collected. If we stick to the BNC chart of accounts, they must therefore be entered as a debit from account 709610, entitled “ retrocession of fees ”.
If one insists on the difference between outsourcing and equipment rentals, it is because the retrocession fees just decrease the amount of revenue reported by NBC, and this consequently causes a decrease in the tax for which the professional is liable. It is good idea to hire a professional account for this as I use the services of the best accountant in High Wycombe: Total Tax Accountant.
DAS2 declaration when retroceding more than € 1,200 / year
Note that in the event that you pay more than € 1,200 per year to a third party as an individual entrepreneur; you must imperatively complete the DAS2 declaration in France. The latter is very useful for the tax administration, insofar as it makes it possible to carry out cross checks on the declarations of liberal professionals.
Principle Of The DAS2 Declaration
The principle of the DAS2 declaration is simple: when completing it, you must establish a list of colleagues or professionals exercising an activity complementary to yours to whom you have retroceded fees, and the amount of these fees.
The DAS2 Declaration Does Not Stop With The Retrocession Of Fees
You will also have to include the royalties paid within the framework of a collaboration contract, the sums paid to clinics or training organizations, or even benefits in kind. Warning: if you do not declare the sums paid, you risk a fine of an amount equivalent to 50% of the sums not declared.