Majority Management (SARL): Social-Protection Scheme for Self-Employed Workers

In a French SARL, a manager (gérant) who controls more than half of the share capital—alone or together with co-managers—falls under the self-employed (travailleurs indépendants) branch of the general social security system. This applies whether or not the manager is paid and regardless of whether the company is active or temporarily dormant. What follows sets out the affiliation rules, registration formalities, contribution base and rates, collection mechanics, and the main special cases, in a form suited to day-to-day decisions for majority-managed SARL structures.

1. Rules of affiliation for the majority manager of a SARL

1.1 Who is “majority” SARL Manager for social-security purposes?

A majority manager is any SARL gérant who holds, directly or indirectly, more than 50% of the share capital, whether acting alone or as part of a college of managers (gérance collégiale). In the latter case, all co-managers are treated alike: if their combined holdings exceed half the capital, each is deemed majority for social-security purposes.

• Remuneration irrelevant: A majority manager is affiliated to the self-employed scheme even if unpaid (Cass. soc., 15 July 1999, no. 97-21146).

• Employment contract incompatible: A majority gérant cannot validly cumulate a corporate mandate with an employment contract in the same company.

1.2 Shareholders (“associés”) and EURL

• Shareholders as self-employed: Associates fall under the self-employed scheme if they perform a non-salaried professional activity (or one treated as such) within the meaning of the Social Security Code.

• EURL: The sole associate of an EURL falls under the self-employed scheme only if he/she pursues a professional activity in the company (Cass. soc., 3 Apr. 1997, no. 95-12866; 12 Oct. 2000, no. 98-20399).

1.3 Cessation of activity or “standby” companies

A majority manager who ceases all activity and stops drawing any remuneration remains affiliated to self-employed old-age insurance as long as the company exists (Cass. soc., 28 May 1998, no. 96-20917; 19 Dec. 1996, no. 95-10432). If the intent is to stop contributions, the clean route is to dissolve the company (where possible) and have it struck off the RCS.

1.4 De facto managers

De facto managers (dirigeants de fait) are treated as self-employed whatever their shareholding. The assimilated-employee regime is reserved to de jure managers only; de facto management excludes it (Cass. soc., 21 Mar. 1972, no. 70-14452).

2. The self-employed scheme in a nutshell

Since 1 January 2020, social protection for self-employed persons has been integrated into the general system, while maintaining certain specific features (health/social action; mandatory supplementary pension and invalidity-death schemes).

• Non-regulated liberal professions have been progressively folded into the same base-rules as artisans and traders (same contributions, same benefits).

• Regulated liberal professions (C. séc. soc., art. L. 640-1) remain under the general system for health-maternity, and under CNAVPL for pensions/invalidity.

3. Registration formalities and timeline

3.1 One-stop electronic window

All business lifecycle formalities—creation, changes, cessation—are filed via the single electronic window (guichet unique):
formalites.entreprises.gouv.fr (or directly: https://procedures.inpi.fr).

• A creation filing triggers, via URSSAF, affiliation to self-employed social security for health-maternity, pensions, invalidity-death and family benefits (C. séc. soc., arts. L. 200-1, 1°; L. 611-1, 1°).

3.2 Date of affiliation

Affiliation is pegged to the existence of the company, not to the fact that it is already operating. Courts and URSSAF treat managers/shareholders as exercising a function of control and supervision from the date of registration (Cass. soc., 28 May 1998, no. 96-20917; URSSAF doctrine).

• If the manager is appointed after registration, the affiliation date follows the filing of the appointment with the single window.

3.3 Cessation and removal

Company directors/shareholders must declare cessation via the single window. Removal from social security occurs on the date of dissolution as notified by the liquidator (C. com., arts. R. 123-66, R. 123-70, R. 123-265).

• Presumption of no activity: A self-employed worker with no turnover/receipts and no income declarations for two consecutive calendar years is presumed to have ceased his/her professional activity (C. séc. soc., art. L. 613-4). The person has one month from notification to object (art. R. 611-2).

4. Contribution base: what income, how declared, and when it updates

4.1 The annual social-income declaration

Self-employed contributions (health-maternity, family allowances, basic and supplementary old-age, invalidity-death) are assessed on professional non-salaried income (or on a flat-rate basis where applicable), as defined by C. séc. soc., art. L. 131-6.

• Who declares? The majority manager (or member of a majority college), the non-manager majority shareholder performing a remunerated activity, and EURL profiles listed in the statute must report the data needed to calculate contributions in the personal income-tax return (C. séc. soc., art. L. 613-2; CGI, art. 170).

• Electronic filing is compulsory, even if no income tax is due. If the income return is missing or nonelectronic, a direct transmission to URSSAF/CGSS is required (C. séc. soc., arts. L. 613-2, R. 613-1-1).

Once filed, URSSAF automatically regularises year N-1 and readjusts the provisional schedule for year N. Over/under-payments are either refunded or spread across remaining instalments.

• Sanctions: Absent a declaration, contributions are calculated provisionally on a flat base, and late filing triggers statutory penalties (C. séc. soc., arts. R. 613-1-1, III; R. 613-1-2).

4.2 What counts as income?

The base is full professional income before tax-law deductions/exemptions (C. séc. soc., art. L. 131-6). In practice:

• If the company is under income tax (IR): base = share of profits attributable to the insured.

• If the company is under corporate tax (IS): base = gross remuneration paid to the insured plus the portion of dividends exceeding 10% of (i) share capital, (ii) share premiums, and (iii) amounts credited to the current account.

• The base is computed before the standard 10% professional-expenses deduction (and before Madelin/PER-TNS deductions for those who joined after certain dates).

• Lease-management (location-gérance): include the rents/royalties received.

Note – Reform flag. The 2024 Social Security Financing Act reforms the contribution base for periods from 1 January 2025: contributions will be assessed on a single simplified base aligned to the CSG base (turnover less professional expenses excluding social contributions, reduced by a 26% rate representative of a portion of contributions) (Law 2023-1250, 26 Dec. 2023, art. 18, VII). Decrees will specify adjustments—track them when budgeting for 2025 onward.

4.3 Starting out: flat-rate provisional bases

In the first two calendar years, provisional contributions are calculated on an income assumed at 19% of PASS (C. séc. soc., arts. R. 131-2-1, D. 131-1). They are regularised once actual income is known.

5. How contributions are calculated, updated, and paid

5.1 Annual cadence (N−2, N−1, N logic)

By statute (C. séc. soc., art. L. 131-6-2):

• Early instalments of year N are based provisionally on income N−2 (unless start-up flat bases apply).

• Once income N−1 is declared, the schedule is updated to include:

  • Regularisation for N−1 (final), and

  • Readjusted provisional amounts for N going forward.

Option: You may ask URSSAF to calculate provisional instalments on estimated income for the current year (subject to minimums).

Pilot mechanism (through 31 Dec 2027): Most self-employed workers (outside micro-social and certain medical simplifications) can opt to modulate monthly based on monthly activity/income, with an annual true-up. Liberal professionals under CNAVPL have access since 1 Jan 2023; exclusions exist (notably outside CIPAV).

The same collection logic applies to CSG/CRDS (C. séc. soc., art. L. 136-3).

5.2 Who collects?

• For artisans, traders, non-regulated liberal professions: URSSAF/CGSS handles all contributions.

• For regulated liberal professions (L. 640-1): URSSAF collects health, family, CSG/CRDS, professional training; CNAVPL collects pension and invalidity-death (outside CIPAV’s transition; since 1 Jan 2023, CIPAV’s collection was transferred to URSSAF).

5.3 Payment rhythm and method

• Monthly by default: 12 equal instalments. Choose the 5th or 20th; default is the 5th (C. séc. soc., art. R. 613-2).

• Quarterly (option): due 5 Feb, 5 May, 5 Aug, 5 Nov (art. R. 613-3).

• Electronic payment is mandatory; failure triggers a 0.20% surcharge on sums paid otherwise (C. séc. soc., arts. L. 133-5-5, L. 613-5; D. 133-11, D. 133-17-1).

6. Contribution rates (overview and thresholds)

PASS (2024): €46,368. Several thresholds below are expressed as a percentage or multiple of PASS.

6.1 Health–maternity (including daily allowances “IJ” for artisans/traders/non-regulated)

General case (outside CNAVPL/CNBF): base rate 7.20%, reduced on low incomes; above 5 × PASS (€231,840 in 2024), the marginal rate is 6.50%.
If annual income is < 40% PASS (€18,547 in 2024), the rate is 0.50% and the base is floored at 40% PASS (minimum contribution ≈ €93 in 2024) (C. séc. soc., arts. L. 621-2; D. 621-1/-2).

• Between 40% and 60% PASS: progressive 0.50% → 4.50% (formula in art. D. 621-2).

• Between 60% and 110% PASS: progressive 4.50% → 7.20% (formula in art. D. 621-2).

• 110% to 5× PASS: 7.20%; above 5× PASS: 6.50%.

Reform flag: The 2024 Financing Act anticipates a re-tuning of health rates alongside the new base from 2025. Watch the implementing decree.

CNAVPL liberal professions & CNBF lawyers: base health rate 6.50%, reduced below 110% PASS; daily-allowances (IJ) are separate at 0.30% up to 3× PASS (€139,104 in 2024) with a minimum base of 40% PASS (C. séc. soc., arts. L. 621-1/-2; D. 621-3).

6.2 Family allowances, CSG, CRDS

Family allowances (C. séc. soc., arts. L. 613-1; D. 613-1):

• 0% when income ≤ 110% PASS (€51,005 in 2024);

• progressive 0 → 3.10% between 110% and 140% PASS (formula in art. R. 613-17);

• 3.10% above 140% PASS (€64,915).

CSG at 9.20% and CRDS at 0.50% are assessed on the same professional income used for family allowances, increased by mandatory personal contributions deducted from the tax result and certain savings-plan amounts. They are collected together with family allowances.

Professional training (artisans/traders/liberal professions): 0.25% of prior-year PASS (0.29% craftsmen; 0.34% with assisting spouse).

6.3 Old-age (basic), supplementary, invalidity-death

• Basic old-age (C. séc. soc., art. D. 633-3): 17.15% up to PASS, + 0.60% on all income ⇒ 17.75% up to PASS, then 0.60% above. Minimum base: 450 × SMIC hour (€5,243 for 2024), pro-rated if affiliation < 90 days (art. D. 633-2). (Strengthening expected with the 2025 base reform—await decree.)

• Supplementary pension (general self-employed scheme, art. D. 635-7): 7% up to €42,946 (2024 ceiling specific to the scheme), then 8% up to 4 × PASS. For CNAVPL sections and CIPAV transitions, refer to the section rules; some liberal professions had transitional rates through 2023.

• Invalidity-death (general): 1.30% up to PASS, with minimum base 11.50% of PASS (C. séc. soc., arts. D. 632-1/-2). CNAVPL sections apply their own scales.

7. Special configurations and practical edge cases

7.1 Location-gérance (lease-management)

Income derived from leasing a business (fonds) or a fully equipped establishment is subject to social contributions when the lessor carries out commercial acts in relation to that undertaking or otherwise exercises an activity there (C. séc. soc., arts. L. 136-1-1, L. 242-1). Affiliation follows the manager’s status:

• A majority SARL manager-lessor remains under the self-employed scheme.

• Minority/equal unpaid managers may be drawn into a scheme by virtue of lease income; the form and tax regime of the operator influences the amounts declared.

Where the owner manages the operator (e.g., unpaid CEO of an SA) and receives royalties, those can be integrated into the contribution base given the effective general-management functions (Cass. civ., 2nd ch., 2 Mar. 2004, no. 02-19393). The logic is transposable to a SARL gérant who is also the lessor.

7.2 Control through interposed entities

When assessing majority status, take into account control via other companies:

• A gérant with few SARL shares can still be deemed majority if he/she controls an interposed entity holding a decisive stake in the SARL (e.g., controlling a holding at 95% with one’s spouse: Cass. soc., 21 Jan. 1999, no. 97-14196).

• Conversely, merely being CEO of a company that owns the SARL’s shares does not make you majority if you do not control that company (Cass. soc., 22 Feb. 1973, no. 72-10088).

• In joint management, if co-managers—through their other companies—together control the SARL, each is treated as majority (Cass. soc., 2 July 1974, no. 73-11165; 14 Jan. 1993, no. 90-11859).

7.3 Dormant companies and “no activity” presumption

Even without turnover, affiliation begins at registration because the function of control/supervision is viewed as a professional activity. However, two consecutive years with no revenue and no declarations triggers the presumption of cessation (art. L. 613-4), with a one-month window to contest.

7.4 Practical reminder on employment contracts

A majority gérant of an SARL cannot be an employee of that company. Attempting to draft an employment contract will not cure the lack of legal subordination and can create compliance risks. If salaried coverage is the objective, review the shareholding and governance (e.g., dilute to ≤ 50% with genuine independence of the board), or consider group employment structures compliant with French labor law.

8. Quick-reference: bases and exposure by manager type

• EURL – sole associate:

  • Active: self-employed scheme.

  • Base: IR—share of profits; IS—remuneration + dividends > 10% (capital + premiums + current account).

  • Reduced start-up base (19% PASS) applies; eligible for ACRE (exemption) subject to conditions.

• SARL majority manager (or majority college):

  • Always self-employed (paid or not).

  • Base: IS—net remuneration + portion of dividends as above.

  • Health, family, pensions per sections 6.1–6.3; CSG/CRDS on broadened base.

  • Mandatory e-payment; monthly default with quarterly option.

• SARL minority/equal, remunerated (for comparison):

  • Assimilated employee regime (art. L. 311-3), not covered here—but note: no unemployment insurance absent true employment contract conditions.

Notes:
(1) “Net remuneration” for base purposes is after social contributions and includes the 10% professional-expenses mechanism in the contribution base rules.
(2) Dividends counted above 10% of capital + premiums + current-account sums are folded into the social base under the self-employed scheme.

9. Governance, accounting, and cash-flow tips

1. Document majority status. Keep a clean cap table and, where interposed entities exist, evidence control (shareholder pacts, board minutes). URSSAF will look through.

2. Align remuneration and distributions. Under IS, model how salary vs dividends > 10% affects the social base and CSG/CRDS.

3. Track thresholds. Several rates step up at 40%, 60%, 110%, 140% of PASS and at 3×/5× PASS. Budget with these cliffs in mind.

4. File on time. The annual income declaration drives both regularisation (N−1) and provisional readjustments (N). Late filings cause flat-rate assessments and penalties.

5. Use the modulation tools. If revenue is seasonal, consider monthly modulation (pilot scheme) or request current-year estimate to avoid heavy year-end true-ups.

6. Dormancy isn’t immunity. As long as the company exists, the default is affiliation. If the business is over, dissolve and file the cessation.

7. Lease-management income: Make sure rents/royalties are reflected in the social base if you remain involved operationally; mis-reporting invites adjustments.

10. At a glance: what changes in 2025?

• Unified contribution base (aligned to CSG, minus a 26% allowance) will replace today’s mosaic for non-agricultural self-employed outside micro-social.

• Expect rate recalibrations (notably in health) via decree to neutralise or balance the shift.

• For SARL majority managers, the strategic questions remain: remuneration vs dividends, IS vs IR contexts, and the timing of distributions.

Practical advice: As 2025 approaches, run a two-scenario simulation (2024 rules vs 2025 projected base) to anticipate cash-flows. Update shareholder decisions and remuneration policies accordingly.

11. FAQ for majority-managed SARLs

Is a majority manager always self-employed, even if unpaid?
Yes. Affiliation does not depend on pay (Cass. soc., 15 July 1999, no. 97-21146).

Can a majority manager have an employment contract with the SARL?
No. The employment relationship is incompatible with the control inherent in majority management.

When does affiliation start?
On the company’s registration (or the manager’s appointment filing if later), not only when turnover begins.

What if the company is dormant?
Affiliation persists until dissolution and RCS strike-off. After two years with no income and no filings, URSSAF may presume cessation (you may object).

Are dividends always outside the social base?
No. Under IS, the portion of dividends exceeding 10% of capital + premiums + current account is included in the self-employed social base.

Who collects my contributions?
URSSAF (and CGSS overseas) for most items; CNAVPL handles pensions/invalidity for regulated liberal professions (with CIPAV’s collection now moved to URSSAF).

How do I smooth cash-flows?
Elect quarterly payment, request current-year estimates, or opt into the monthly modulation pilot. Always file the annual income return on time to avoid punitive flat bases.

Final takeaways for Frenchco.lawyer readers

• In a majority-managed SARL, the self-employed regime is the rule—pay or no pay.

• Registration triggers affiliation; dissolution ends it. Dormancy does not.

• The contribution base under IS blends salary with a slice of dividends; be intentional about the mix.

• Thresholds matter (PASS-linked progressions) and are central to forecasting.

• Use the one-stop window for all filings; choose a payment cadence that fits seasonality.

• Keep an eye on the 2025 base reform: it changes how income is measured for social contributions, even if the overall burden remains in the same ballpark.

  Avoid URSSAF Penalties and Misclassification

  Dormancy, dividend distribution, or interposed entities—each affects your self-employed status. Ensure full compliance from registration to dissolution.

  Talk to a Social Law Expert