Running small business in France – 5 steps for accounting

We have made a brief and practical list regarding accounting if you’ve decided to start a business in France.

  1. Select your business form
    • The options are basically to operate as a self-employed or to register a limited company SARL. There are also other less common business forms.
    • Evaluate if you need to be VAT registered. It is not necessary if your annual turnover doesn’t exceed certain limits.
  2. Choose the most suitable income tax regime
    • SARL corporate tax is always based on the actual taxable profit it shows. The corporate tax rates are from 15% to 33,3%.
    • The self employed can opt to be taxed on certain percentage of the turnover of the business (tax status of micro-entrepreneur). The turnover means the gross revenues without any deductions. They also need to pay considerable social security payments based on the turnover.
    • The other option for the self employed is that the taxable income is based on the actual profit of the business.
    • The amount of income tax is assessed on a household’s total taxable income which means in practise that if your family lives permanently in France the tax is based on the total income of the family. The system is quite complex and there are also a lot of possible tax reductions and credits. The tax authorities calculate the accurate tax amount. Altogether the total of income and social taxes can be very high compared to many other European countries.
  3. Open a business bank account
    • You have a liability to open a separate bank account for your business purposes. It is important to keep the private transactions and business transactions apart from each other.
    • When choosing the bank group it is advisable that you make sure the bank can produce you the bank statement in XML format. That’s the standard confirmed by EU and it can be a basis for an effortless and affordable accounting.
  4. Organise the accounting
    • Invoicing software is very important tool if your sales are mainly based on billing the customers. Be sure to choose a modern digital invoicing software which is location independent and cost effective.
    • Basic bookkeeping is an essential part of the accounting and business management. It is smart and advisable that you organise your books to understand what is the real profit of your business, whatever is the taxation regime applied to you.
    • AutoAccount by Digibalance is an effortless and affordable bookkeeping system which is based directly on the transactions in your business bank account.
  5. Archive
    • The accounting of the business is based on the documents to confirm the transactions. It is important to remember to archive the documents. Most of them can nowadays be saved as electronic files on cloud services.
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Free consultation in Nice area

Internations LogoHello! This time we have started a new campaign with InterNations targeted to entrepreneurs in France. If you have started your business in France and want to know more about financial management and running your business in general, we are now offering a free consultation meeting in the Riviera area. The meeting can also be held on Skype.

Even if you haven’t started your business yet and need help in the setting-up your books and other practical details, we are very happy to meet you and give you guidance in entrepreneurship.

Click here to read more and schedule a meeting

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Article about Digibalance in Finnair’s Blue Wings magazine

We are happy to announce that Digibalance Ltd. was featured in this month’s issue of Blue Wings magazine by Finnair, published on 3rd March 2017.  The article gives a brief explanation of our priorities in accounting and why we think utilising automation is useful. The article also mentions our upcoming mobile application. If you don’t have access to a physical copy of the magazine, you can read the article below:

Image of Digibalance article in Finnair Blue WingsDigibalance produces digital bookkeeping services for European micro-entrepreneurs

The Finnish company Digibalance has already developed a completely digital bookkeeping service for European small businesses. Now, this pioneering company will also launch a mobile app for small businesses; a tool for business owners to monitor financial performance that can be carried in your pocket.

Digibalance is a Finnish-owned accounting firm, established in 2008. Its vision is of producing Finnish origin online bookkeeping for small businesses in the entirety of the EU. The company’s primary target group consists of European start-ups, micro-entrepreneurs, and businesses of 1-4 employees in size. “This target group includes many people that employ themselves as entrepreneurs in unfamiliar environments. At the moment, we at Digibalance offer online accounting services in Finland, Estonia, France, the UK, and Italy, but our goal is to duplicate our services in all of the European SEPA countries. We are the best in on-going monthly accounting. For special taxation questions and Financial Statements, we use local expertise”, says the Chairman of the Board Mikko Ilves.

Automation keeps costs down

In practice, what does ‘digitalised bookkeeping services’ mean? “In the AutoAccount service we have replaced the arduous paper phases of accounting with automation. The service is effortless and affordable for the entrepreneur. Thanks to the digitalisation and automation of the process, the client does not pay for anything unnecessary. The service is also ecological and location independent, because all documents are transmitted online. In spite of the digital process, the client also gets assistance in case of need; since contacts with our team are conveniently handled online, for instance through Skype, and the service language is English.” Ilves reveals that online accounting, at its least expensive, costs € 40/month. “In addition, the monthly fee does not depend on the number of transaction documents; hence, a growth in business activity and the number of transactions does not automatically raise the monthly fee. This brings predictability into the everyday life of the entrepreneur.”

Online monitoring in your pocket

Now Digibalance is launching a mobile application – Digibalance mobileApps, a tool for small business owners to monitor financial performance. “Young entrepreneurs are especially used to taking care of their daily affairs through mobile devices. That is why we want to offer European small business owners the chance to handle business matters by mobile device as well.” Ilves says that Digibalance mobileApps works both-ways between Digibalance and the client. “The client can send us additional information and we in turn produce reports for the service. The idea is that when the micro-entrepreneur opens the mobile service, they see a view that reveals both the present situation of the business and a financial forecast. As a new feature, we also generate taxation forecasts in the service. Later, other services, in connection with entrepreneurship offered by various cooperation partners, can also be added to the service. We will launch the mobile service for clients during the spring.”

Text by Mia Heiskanen / Blue Wings.

 

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Free consultation meeting in Finland

Internations LogoHello! We have started a new campaign with InterNations targeted to entrepreneurs in Finland. If you have started your business in Finland and want to know more about financial management and running your business in general, we are now offering a free consultation meeting in our office in Helsinki or Turku. The meeting can also be held in Skype.

Even if you haven’t started your business yet and need help in the setting-up process and other practical details, we are very happy to meet you and give you guidance in entrepreneurship.

Click here to read more and arrange a meeting

 

 

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Starting Micro-entrepreneur Business in Finland – 7 Points to Take into Account

Image of a start-up meeting

We have made a brief and practical list of things you need to think through if you have decided to start a business in Finland.

  1. Select your business form
    • The options are basically to operate as a sole trader called “toiminimi” or to register a limited company called “osakeyhtiö”. There are also other less common business forms.
    • The registration process depends on which business form you selected.
    • Be sure to register in prepayment register (“ennakkoperintärekisteri”) and also in VAT register if you know your business is VAT liable. The employer registration is not recommended if you are not employing other people on a permanent basis.
  2. Organize the accounting
    • Basic bookkeeping is an essential part of the accounting and financial management. You should start co-operation with an accounting agency which utilises digital tools to keep your bookkeeping affordable and effortless.
    • Taxation is based on the books and can be handled by the same accounting agency electronically when you have given the appropriate authorization.
    • Invoicing software is very important tool if your sales are mainly based on billing the customers. Ask your accountant contact for help when choosing the software.
    • If you’re planning to employ other people it makes sense to choose an accounting company who can also offer payroll services.
  3. Open a business bank account
    • You have an accounting liability concerning your business. As a part of that it is important to keep the private transactions and business transactions apart from each other.
    • Choose the bank group and appropriate bank services based on your accountant’s advice.
  4. Make the insurance agreements of at least the obligatory pension insurance (YEL)
    • Your accountant might be able to recommend you an appropriate insurance company.
    • If you will be employing you need also other obligatory insurances
    • As a part of risk management it might be wise to consider other voluntary insurances.
  5. Have a look if you’re entitled to the start-up grant
    • More information at the TE Office
    • Note! If you apply for the start-up grant you cannot start your business before the application is handled.
  6. Be sure of other possible permits
    • Some entrepreneurs see Finland as a bureaucratic country, some don’t. It depends on the line of business you are in. Find more information on the necessary permits especially if you are, for example, in the restaurant business.
  7. Start
    • Remember that the most important thing is to know what you sell and to find customers! You also need to keep your archives in order and respect the deadlines of invoices. There is support available for business administration but you have to be careful and buy only affordable services.
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Remote work is a way of life for Carina

Digibalance accountant Carina Björnvik works from her home in Florence, Italy via remote work.

Digibalance's "office" in San Frediano, Florence

Entrance to Carina’s “home office” in San Frediano, Florence.

Carina “Cia” Björnvik has been working in Digibalance since 2015. Her work includes bookkeeping for different companies in different countries. Carina is originally from Finland, but she has chosen to remote work from Italy, where she moved in the beginning of the millennium. The flexible nature of the work made it possible to move to her husband’s home town, Florence. The family lives in the old central district San Frediano and they own a summer place in the countryside, just 20 kilometres from Florence, where work can also be done during the school holiday times.

Usually Carina starts working at 8 o’clock in the morning, when her son leaves for school. The first thing she does is checking and answering emails. Carina does bookkeeping for micro enterprises and self-employed from different fields of business. Also the customers’ backgrounds are often from different cultures.

For Carina, remote work enables the use of time more freely than in regularly scheduled work. Work can be done even in the villa or the work may be scheduled to do at an appropriate time, for example, when children are in school. However, even in remote work there must be some sort of a routine for the day.

In Carina’s opinion, the downside of remote work is that you do not see your colleagues very often or at all. You have to fill your social needs in somewhere else than work. You also must have some kind of self-discipline and the ability to create daily routines for yourself, since no one else is going to do it for you. In addition, especially in remote work, the importance of technological functionality is emphasized. If the Internet connection is down or your computer is broken, you have to figure everything out yourself, since you cannot just call the IT department to come and fix everything.

Prior to starting at Digibalance, Carina was already used to remote working in an international environment. She has worked in different countries and is familiar to the accounting practices in not only Italy and Finland, but also in the other Nordic countries. According to Carina, the Italian way of bookkeeping is still often very manual. In many companies the benefits of automation are not yet used in practice. Even though automation and remote work are slowly increasing in Italy, the biggest problem seems to be that the information is usually not in electronic form, which means both more manual work and massive paper consumption. However, Carina is continually making effort that Digibalance’s AutoAccount practices would be more widespread in Italy.

While Carina and her family make visits to Finland frequently, their plan is to stay in Italy permanently. However, the Nordic culture is far from forgotten! They often meet up with Swedish families who also live in Florence. Together they celebrate traditional Nordic festivities such as Saint Lucy’s Day.

Carina doing bookkeeping via remote work from her home in Italy.

Carina working remote from her home in Italy.

According to Carina, the possibilities of working from home have become a lot easier, when comparing to what it was before. For example programs like Teamviewer have made the internal workplace communication easier. Nowadays, being employed in a Finnish company is relatively effortless, even if you live abroad. As the technology and society develop, also remote work opportunities are constantly getting better.

Once you are used to remote work, you don’t want to go back to the office work and 9-to-5 schedule.” Carina says. “Remote work is a way of life, which may not suit everyone, but for me it is just right.

The majority of Digibalance's international customer's bookkeeping is done here.

The majority of Digibalance’s international customer’s bookkeeping is done here.

 

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Migrant entrepreneurs in Europe

More than a million refugees arrived in Europe last year and this great migration has continued this year. There are also millions of migrants in European countries who are not refugees instead they have voluntarily moved in their current country. The main reasons are usually work or personal relationships.

The lack of work is the most common reason for the immigration problems. There are a huge amount of people who are willing to work and adapt in their new country but they cannot find work. They might also possess expertise which would meet the local demand but the local employers do not have courage to employ them due to limited language skills, cultural differences or just some non-specific prejudice.

European Commission has also realised the potential of migrant entrepreneurs. They are one of the main target groups when promoting entrepreneurship:

Entrepreneurship is a powerful driver of economic growth and job creation: it creates new companies and jobs, opens up new markets, and nurtures new skills and capabilities.

The European Commission aims to support an environment attractive to all forms of entrepreneurship, where also business support services reach all potential entrepreneurs, including those from more vulnerable groups, with the aim to make the EU in its entirety stronger and more cohesive.

Within the EU, migrants represent an important pool of potential entrepreneurs, but can face, as other more vulnerable groups, specific legal, cultural and linguistic obstacles. These issues need to be addressed in full to give support equitable to that received by all other entrepreneurial groups. “

Migrants have been included in EU’s Entrepreneurship 2020 Action Plan.

The entrepreneurship percentage of migrants is higher than with the EU citizens with non-migrant background. The total amount of micro enterprises in EU is about 21 million. According to the estimates made in Digibalance, over 3 million of them are run by migrant entrepreneurs. Digibalance Limited is actively promoting migrant entrepreneurship in all the EU countries where its AutoAccount bookkeeping service is available.

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Thank you for attending our customer event in Helsinki!

Digibalance Customer Event

On Thursday the 22nd September 2016, we held an informal event for our customers to meet us and mingle with other entrepreneurs, and to have a good time overall. The event was held at the beautiful bar Sköne in Helsinki, Finland.

We sincerely want to thank everyone who came. It was really nice to meet you all!

Hopefully we can arrange more similar events in the future!

 

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Entrepreneur, humble yourself and start selling

Published in Kauppalehti/Debatti on 22nd February 2016
Guest writer: Mikko Ilves

One of the most challenging tasks in having a business is creating turnover. That is is based on sales and customer service. As an entrepreneur myself, I try to examine this also from a customer’s point of view. I’m sure that everyone has had unforgettable customer experiences, my own top 3 would be the following.

I was being a support person for a patient at a private clinic. After a small operation, the patient was in a near fainting condition, when the clinic employee noted that maybe the patient should be taken to a public health-care centre!

An employee in a smaller Swedish bank wanted to terminate the banking services of a small enterprise. Even if the small company was joining a bigger corporation, it would not have an effect on the decision. It seemed that the most important thing for the employee was to get rid of the customer, instead of upselling, because maintaining the customership was currently too troublesome!

As my third memorable experience of customer service, I want to list the whole industry of boat selling. I have rarely encountered as arrogant service in any other field. I have bought three brand new boats and will definitely choose another brand when I’ll buy the fourth one. However, I’m hoping to encounter this time a sales person, who will change my opinion of the field of boat selling. It is good to keep in mind that if the customer’s purchases are being too minimal, you can always start thinking about the potential next purchase the customer will make.

All the aforementioned examples are about the employee being also a representative to the company and the whole brand. Therefore, I have been thinking if the company management or a potential entrepreneur understand how customer service works in his/her company. A few times I have mentioned about the quality of the customer service, but usually the complaints have not had any effects. If the manager does not have the courage to interfere with the employee’s way of working, the company can lose a lot of potential sales. The connection between customer service and making profit is even clearer for a private entrepreneur.

For example, if an IT consultant promises to solve a network problem, but suddenly decides to disappear, the customer will not necessarily call after him. Or if an agreement has been made about electrical installation and the customer finds that the job has been left half done. A long-time cooperation partner could turn a blind eye once or twice for this kind of behavior, but they probably will start thinking of changing business partners and spread the word about the service. Taking a customer for granted is the worst mistake a company can make in terms of maintaining and increasing sales.

Also a customer can demand unreasonable things. If you pay only the minimum price, it is acceptable to expect a good and satisfactory service for your needs, but then you cannot demand a full-service package. An entrepreneur has to be humble while explaining this, and even then you will sometimes get negative feedback. One’s character will be put to test when the feedback is unfair. In these situations, you can think over if you want to be right and get the final word or make a sale. If you find that you lack the humility, then maybe you are not the right sales person for your company.

To end up with a positive experience – The service of our software provider has been slow for a long time. After a message to the CEO, he answered quickly with an apology and in the afternoon the delivery problems were fixed. However, things can’t always be handled by contacting the top management, but it is important to also spread the positive word.

 A column in Kauppalehti by Mikko Ilves: "Entrepreneur, humble yourself and start selling"

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