# Request for some clarification on deduction of disbursements for AE



## van_suso

*Request for some clarification on deduction of disbursements for AE*

Hello,

I was studying this link: https://www.assistant-juridique.fr/deduction_charges..., and I came across the part where it says that "Un auto-entrepreneur peut déduire les débours/A self-employed person can deduct the disbursements". I've two questions:

(1) I'm not sure I'm quite clear on this one. I understand that as an AE, I can't claim charges, as written in "Par conséquent, toutes les dépenses professionnelles (emprunt, achats de matières premières, loyer, assurances, téléphone, frais de véhicule, cotisations sociales...) restent à la charge de l'auto-entrepreneur." On the other hand, it also says where it talks about 'debours', "achat de marchandises dans le cadre d'une prestation de service : produits d'entretien, fournitures diverses, équipements, matériels…" falls under débours. So I'm not sure if I've to buy a new computer (which is a material I suppose?) for my AE activity, would that be counted as a 'débours' or 'charges'? Explanatioj appreciated.

(2) Being a novice, I'm really not clear on "Règles de déduction des débours". Does this mean if I've to buy a new PC for my AE activities, I've to ask my client to reimburse me for it and use the facture and reimbursement corresponding to purchasing that PC as a proof of my disbursement? But then again, if my client already reimburses me for my purchase, then why should I claim any further deduction at all, showing that disbursement? Sorry if my questions are too elementary but I'm trying to get some clarity on this.

(3) *Related:* If I pay a person by CESU to do part of my own activities, can that be claimed back in any form to save money? Say for example I provide online tutoring and

Thank you in advance!


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## EuroTrash

This explanation may help








Déduction pour achat matériel en auto-entrepreneur : est-ce possible?


Retrouvez toutes les informations concernant les achats de matériels et autres frais en auto entrepreneur.




pole-autoentrepreneur.com




*Un auto-entrepreneur peut déduire les débours*
_Les débours sont les sommes avancées par l'auto-entrepreneur, remboursées ensuite par le client. Les frais de débours correspondent alors à l'achat de marchandises dont la mise en œuvre s'accompagne d'une prestation de services._

Say your client agrees to supply you with a computer so that you can work from home, and tells you to go out and buy one. You pay 1 000€ upfront, out of your own pocket. Your client reimburses the cost. The reimbursement will normally go through your accounts because your client will need the papertrail in order to claim the 1 000€ on his own business expenses. So say you normally invoice your client for 5 000€ per month, on this occasion you will invoice your client for 6 000€ comprising 5 000€ services plus 1 000€ debours for the pc, and when the invoice is paid that month you will receive 6 000€. Normally all monies received by you from your clients are regarded as turnover, on which your cotisations are based. A micro entrepreneur's annual income declared normally exactly equals total annual receipts (I just checked my figures for last year, and it did)..
But in this case, you can deduct the 1 000€ and on your declaration you would only declare your turnover as 5 000€ as usual. So ultimately it's as if the client paid directly for the pc; the only reason it went through your books at all was because logistically it was less hassle for you to buy the thing yourself.

The essential difference is that debours is distinct from a business expense of your own. It is a business expense of a different business. The pc you bought for 1 000 because your client specifically instructed you to buy it on the understanding that they would bear the cost, and they reimbursed you, is their business expense. If your client didn't specifically instruct you to buy it, didn't agree to bear the cost and doesn't reimburse the cost, then it's your own business expense and you can't deduct it. 
Likewise if you pay a subcontractor, then unless your client has instructed you to do this and agreed to bear the cost, it is your own business expense and not deductible. 

Does that make it clearer?


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## EuroTrash

Just found this which clarifies further


https://www.cci.fr/ressources/micro-entrepreneur/le-chiffre-daffaires-du-micro-entrepreneur/frais-de-debours


- I didn't know this but it appears to be important that when you buy the computer or whatever it is, the invoice is made out in the name of your client that is going to bear the cost, with their siret number etc, and not in your own name and business details.
Whoops, in the past I've deducted frais de debours for hotel bills that my client refunded but I had the bills in my own name. Hey ho. We live and learn.


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## van_suso

EuroTrash said:


> Just found this which clarifies further
> 
> 
> https://www.cci.fr/ressources/micro-entrepreneur/le-chiffre-daffaires-du-micro-entrepreneur/frais-de-debours
> 
> 
> - I didn't know this but it appears to be important that when you buy the computer or whatever it is, the invoice is made out in the name of your client that is going to bear the cost, with their siret number etc, and not in your own name and business details.
> Whoops, in the past I've deducted frais de debours for hotel bills that my client refunded but I had the bills in my own name. Hey ho. We live and learn.


Many thanks to your answer, I skimmed through for now and find it really helpful - appreciate it! I'll read it in detail again and may ask some follow up questions - thanks again!!


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## van_suso

> Likewise if you pay a subcontractor, then unless your client has instructed you to do this and agreed to bear the cost, it is your own business expense and not deductible.
> 
> Does that make it clearer?


Yes it's very clear now, thanks again! The only part that's not clear yet is the subcontractor part: where I raised some quick follow-up questions?

"Likewise if you pay a subcontractor, then unless your client has instructed you to do this and agreed to bear the cost, (cost of what exactly though?) it is your own business expense and not deductible."


Say I work for a client and I subcontract part of the work. I can't see how the client has to pay anything extra for this subcontract, because at the end there'll be no added cost to pay to the subcontractor, who'll be filling in my part, so the subcontractor's income from my client will _first_ go to my account, from which I'll pay the subcontractor myself, if I'm not mistaken. I can surely obtain a letter from my client stating that I'm the principal contractor for the project and I'm hiring a subcontractor to fill in for me, but this'll not incur any cost that I've to bear and the client has to reimburse, does it? Of course I'll have to pay the subcontractor at the end (using CESU or other means perhaps), but I'm not sure if I can show somehow that paying the subcontractor was essentially a disbursement (?) I'll be happy to be wrong here!

P.S. I'll ask a question on a related topic soon, on BNC réel tax regime where one can declare expenses, but not sure if it applied to auto-entrepreneurs. If not, I won't ask it soon.


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## EuroTrash

I think you have full info about frais de debours in the links above. I can't see a way to make this work, or at least not without a whole series of potential problems (that would make this a very long post indeed and I don't have time right no) but if you can see a way, go ahead. 

But I do not follow your logic. You said 


van_suso said:


> *this'll not incur any cost that I've to bear and the client has to reimburse*, does it? Of course I'll have to pay the subcontractor at the end (using CESU or other means perhaps), but I'm not sure if I can show somehow that paying the subcontractor was essentially a disbursement (?)


But if it does not incur a cost that you have to bear and the client has to reimburse, then it is not a frais de debours is it, because that's what a debours is.
I think the paper trail you need is set out in one of the links, si in this case, assuming the subcontractor you use is another freelancer, you would need firstly the invoice from your subcontractor made out to the client not to you, and secondly your own invoice to the client, to which you attach the subcontractor's invoice, would need to show a separate line requesting reibursement of the exact amount of the invoice. 

Possibly you could work it, though as I said I see several potential problems, but the crucial thing is that you would have to deal separately with the hours you taught and the hours the subcontractor taught. You said "the subcontractor's income from my client will _first_ go to my account, from which I'll pay the subcontractor myself" but this would not be a debours. If you want to make out it is a debours you would not be able to invoice for the full amount of teaching. Everything that the client pays to you in respect of services provided, is classed as your turnover and you cannot deduct anything from that. What you would have to do, I think, would be to invoice the client only for the hours you yourself taught, then just that would be your turnover. The fee for the subcontractor's hours would appear separately on your invoice as frais de debours, ie not part of your turnover. So yes, if the subcontractor is paid the same hourly rate as you then the cost to the client would be exactly the same, but the paper trail would be different and that's what's important.
I seems to me you would be simply be doing a lot of unpaid admin work, since the subcontractor's invoice has to exactly match the request for reibursement on your invoice. You cannot take a percentage or mark up on a debours or it no longer qualifies as a debours.

As a side issue, as a business you would use TESU not CESU. CESU is for private individuals.


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