Side business: micro-enterprise or company, which structure in 2026

Quick answer. For a side business launched alongside a job, the micro-enterprise remains the right starting point: free to set up, contributions on the turnover actually collected (so zero with no receipts), 2026 thresholds of 203,100 euros (sales) and 83,600 euros (services). A company (single-member or multi-member limited company) becomes relevant to protect your estate, deduct real charges and gain credibility, at the price of more formality. Combining with a job requires respecting the duty of loyalty and any exclusivity clause.

Launching an activity alongside your job has never been more common: consulting in the evening, online sales on weekends, content creation, crafts. The first decision is not commercial, it is structural: should you set up a micro-enterprise, simple and reversible, or a company, more protective but heavier? And how do you combine the project with your employment contract without breaching it? The micro-enterprise regime is governed by the French tax code and described by the administration (see Service Public). Here is our reading grid for 2026, with a worked example.

The micro-enterprise is the natural route to validate a side business. Its logic is simplicity: a start-of-activity declaration in a few minutes on the single window, lightened accounting (a receipts book, plus a purchase register for sales activities), and above all social contributions calculated as a percentage of the turnover actually collected. No receipts in a given month means no payment: this is the decisive advantage for a project in test phase.

The 2026 micro-regime thresholds are 203,100 euros of turnover for the sale of goods and accommodation, and 83,600 euros for services (BIC) and self-employed professional activities (BNC). At the start of a side business, these thresholds are rarely a brake.

Two confusions come up systematically. First, these micro-regime thresholds are not the VAT-exemption thresholds, which are lower and separate. Second, the contribution rate depends on the nature of the activity: a category error distorts the whole calculation. The detail of the obligations is in our article on micro-enterprise accounting in 2026.

The social contribution rate (micro-social) varies depending on whether you sell goods, provide BIC services or run a self-employed professional activity in BNC. This single rate already includes the CSG-CRDS social levy: you must never add further social charges on top.

The micro tax allowance covers your charges on a flat-rate basis: tax is calculated on turnover less this allowance (minimum 305 euros), not on a real profit. This is precisely the point that tips the decision, because it ignores your actual expenses. For BNC, the micro-social rate was raised to 25.6% on 1 January 2026: one point more than before, to factor into your forecasts.

The VAT exemption follows its own thresholds: 85,000 euros (with an increased tolerance at 93,500 euros) for sales, and 37,500 euros (tolerance at 41,250 euros) for services and professions. Below these, you charge no VAT and reclaim none; above, you become liable. For a services side business, that 37,500 euros threshold is often reached well before the 83,600 euros micro ceiling: it is the real first level to watch. The thresholds in force are published by the Urssaf.

One last 2026 point: the ACRE, a partial first-year exemption from contributions, drops from 50% to 25% for businesses created from 1 July 2026. If your project is ready, creating before that date keeps the 50% rate.

The company answers needs the micro does not cover. Creating a single-member or multi-member limited company legally separates your personal estate from the activity, which limits your exposure in case of debt or dispute. It allows real charges to be deducted (purchases, equipment, subcontracting, rent, subscriptions), where the micro applies a flat allowance indifferent to your expenses. It also brings credibility with large-account clients or partners, and the option to take on partners or raise funds.

In return, it requires real accounting, articles of association, a capital deposit, annual accounts to file and recurring creation and management costs. The choice between forms deserves a separate analysis: we detail it in our comparison sole trader or single-member company and, more broadly, in the article choosing between sole trader and company to start out.

For an employee, the director's social status also matters. The president of a single-member SAS is treated as an employee: with no remuneration, they pay no minimum contributions. The majority manager of an EURL or SARL is self-employed (TNS) and remains subject to a minimum contribution even without remuneration. This detail weighs for a low-volume side activity.

The choice depends on the scale of the project and the weight of your real charges. The table below summarises the structuring differences.

Our view: it is the weight of real charges that decides#

For a side business, the micro-enterprise is almost always the right starting point: it allows testing with no risk or cost, and switching to a company later if the activity takes off. In our files, the real switch criterion is neither stated ambition nor the wish to "look serious", but the ratio between your real charges and the micro's flat allowance.

Take a BNC services activity at 30,000 euros of annual turnover. In micro, the 34% allowance assumes your charges represent roughly 34% of turnover. If you work from home, with no purchases or subcontracting, your real charges are far lower: the micro is unbeatable, and you are also VAT-exempt as long as you stay under 37,500 euros. Conversely, a sales activity with significant stock, subcontracting or premises quickly generates real charges above the allowance: the company, which deducts those charges in full, regains the edge. The question is therefore not "micro or company" in the abstract, but "do my charges exceed the allowance, and do I need to protect my estate?".

Launching an activity while employed remains possible, but framed. The employment contract is performed in good faith (Labour Code, article L1222-1, see Legifrance), and the employee remains bound by a duty of loyalty to their employer, expressly restated in article L1222-5 of the same code. Case law has clarified its scope: not running a competing activity, not soliciting the employer's clients, not using the company's resources (equipment, files, working time). These prohibitions do not appear word-for-word in the articles: they flow from how the courts apply them.

Some contracts include an exclusivity clause prohibiting any other professional activity. To be valid, it must be justified by the nature of the role and proportionate to the aim, failing which it is unenforceable. Above all, article L1222-5 of the Labour Code neutralises this clause for one year in favour of the employee who creates or takes over a business: the employer cannot rely on it against them during that period, even where a contractual stipulation says otherwise (the employee still remaining bound by loyalty). It is better to re-read your contract and, in case of doubt, discuss it with your employer rather than take a disciplinary risk.

Two particular situations deserve attention: public-sector staff are subject to their own combining rules (authorisation, declaration); and a part-time employee or a jobseeker may keep part of their benefits under conditions. The reflex is to secure the contractual and social side beforehand.

An employee consults us with the idea of setting up a single-member SAS from the launch of a still-uncertain side business, to "look serious" to their first prospects. The analysis showed that at the test stage, the micro was largely enough: modest forecast turnover, no significant real charges (working from home, no stock), and no immediate need to protect the estate. Checking their contract confirmed the absence of a blocking exclusivity clause.

They started as a micro, collected their first invoices with no sunk contributions, validated their market, then switched to a company the following year when volume and charges justified it. A company created from the outset would have cost incorporation fees, accounting and minimum contributions (had they chosen the EURL), for a project that might never have succeeded. The right time to change structure is decided on figures, as we explain in our article on the right time to move from micro to company.

In practice: securing the launch of your side business#

• Re-read your employment contract: exclusivity clause, non-compete clause, duty of loyalty; if needed, ask your employer for written confirmation.
• Classify your activity correctly (sales, BIC services, BNC professions): it sets the contribution rate and the allowance.
• Estimate your real charges over 12 months and compare them with the micro allowance: that is the switch indicator.
• Watch the VAT-exemption threshold (37,500 euros for services, 85,000 euros for sales), often reached before the micro ceiling.
• If you create in 2026, time the date with the ACRE in mind (50% before 1 July, 25% afterwards).
• Open a dedicated account for the activity from the first euro collected, so as not to mix flows.

• Never confuse the micro-regime thresholds (203,100 / 83,600 euros) with the VAT-exemption thresholds (85,000 / 37,500 euros): they are two distinct mechanisms.
• The micro-social rate already includes the CSG-CRDS: do not add any social levy on top.
• A wrong activity classification (BIC instead of BNC, for instance) distorts the contribution rate and the allowance.
• The flat allowance is only advantageous if your real charges are below it: beyond that, you pay tax on margins you do not make.
• An exclusivity clause or a breach of loyalty can lead to a disciplinary sanction: this risk would ruin the point of the project. The benefit of the one-year suspension of the exclusivity clause assumes you genuinely create or take over a business, on the conditions set by law.
• Creating a company too early locks in costs (incorporation, accounting, minimum contributions in an EURL) that the micro avoids until the project is validated.