The SARL de famille (family-owned limited liability company) is a legal form particularly well-suited to family businesses looking to benefit from specific tax advantages. This structure enables family businesses to optimize income while keeping social security contributions under control. In addition to tax considerations, social security contributions are a major issue for partners and managers. Understanding the applicable mechanisms helps to optimize remuneration and control social security contributions. This guide takes a detailed look at the social security system applicable to family-owned SARLs, from managers to partners, including the optimization strategies available within the framework of corporate legal structures.

What is a SARL de Famille?

The SARL de famille is a limited liability company formed exclusively by members of the same family. This structure benefits from a special tax regime, as set out in article 239 bis AA of the French General Tax Code. Partners must be related in the direct line, or between brothers and sisters, as well as their spouses and PACS partners.

The main advantage lies in the possibility of opting for income tax (IR) rather than corporation tax (IS). This option allows profits to be taxed directly in the hands of the associates, according to their marginal tax rate. The SARL de famille is one of a number of special forms offering significant tax advantages for family businesses. This special tax regime also has important implications for the social security contributions applicable to managers and partners.

Eligibility requirements are strict. All associates must have direct family ties. The entry of an unrelated third party automatically entails the loss of status and the switch to corporate income tax. This requirement guarantees the family nature of the structure and justifies the tax advantages granted.

The Social Security Scheme for Managers of Family Limited Liability Companies (SARL de Famille)

The manager’s social status depends on his or her shareholding. A manager holding more than 50% of the company’s shares is referred to as a majority manager. In this case, they are covered by the TNS (non-salaried workers) scheme, and contribute to the Sécurité sociale des indépendants (SSI).

Minority or equal shareholding managers enjoy the status of assimilated employees. They are affiliated to the general Social Security system, just like conventional employees. This fundamental distinction has a direct impact on the level of social contributions and associated social protection.

The basis for social security contributions for a majority-owned TNS manager includes his remuneration and the share of profits to which he is entitled under the IR option. Social security contributions represent around 45% of net remuneration. In the case of a minority manager who is treated as an employee, employer and employee contributions amount to around 80% of the net salary, but offer better social security coverage.

Social security contributions for non-managing partners

Non-managing partners of a family-owned SARL generally receive no remuneration for their corporate office. Their income comes mainly from dividends distributed by the company. These dividends are subject to social security deductions at a global rate of 17.2%, including CSG, CRDS and solidarity levy. This rate applies regardless of the tax regime chosen by the company.

The situation of a family limited liability company (SARL) that has opted for income tax (impôt sur le revenu – IR) is quite different. Profits are taxed directly in the hands of the partners, in proportion to their shares, according to the rules governing categorical income (BIC, BNC or BA). These profits are not subject to social security contributions for non-managing partners, unlike majority shareholders. Only the 17.2% social security contribution applies to the fraction of income considered as capital income.

A non-managing partner who works effectively and regularly for the company may receive remuneration separate from his status as a partner. In this case, he/she is subject to the general Social Security system as an employee, and pays the corresponding social security contributions (around 80% of net salary in employer and employee charges combined). This situation requires an employment contract distinct from the corporate mandate, effective legal subordination and technical functions different from those of a manager. The tax and social security authorities carefully examine these situations, to avoid any abuse of requalification.

Calculating and optimizing social security contributions

Social security contributions are calculated on the basis of the manager’s remuneration and, where applicable, his share of profits. Contribution rates for a majority-owned TNS manager vary according to branch: sickness-maternity (6.5% to 6.9%), family allowances (0% to 3.1%), basic pension (17.75%), supplementary pension (7% to 8%), invalidity-death (1.3%) and CSG-CRDS (9.7%). These contributions are deductible expenses that reduce the direct tax base.

Tax and social security optimization involves a trade-off between remuneration and dividends. High remuneration generates high social security charges, but is deductible from taxable income. Dividends incur lower charges (17.2%), but are not tax-deductible. The optimum strategy depends on the marginal tax rate and the social protection needs of each associate.

The distribution ofinterim dividends allows you to anticipate the distribution of profits. This technique offers flexibility in the management of associates’ personal cash flow. However, it requires compliance with strict conditions, notably the existence of sufficient distributable profits.

Tax allowances can also reduce the overall tax burden. In the case of a family limited liability company subject to income tax, the partners benefit from the tax allowances applicable to income in their category (BIC, BNC, BA). This optimization requires an in-depth analysis of each partner’s wealth and tax situation.

Comparison with other legal structures

A comparison of SARL de famille and SAS reveals significant differences in social security charges between SAS and SARL. The chairman of an SAS is systematically covered by the general regime as an assimilated employee, with social security contributions of around 80% of net salary. The SARL de famille offers greater flexibility in terms of the manager’s status, with a choice between the TNS regime (majority manager) and the assimilated employee regime (minority manager).

TheEURL and its social security system are very similar to that of a SARL for a sole proprietor. The sole managing partner of an EURL is covered by the TNS system, like the majority managing partner of a SARL, with social security contributions of around 45% of net remuneration. However, the EURL does not offer the advantages of family ownership of the company’s capital and the resulting tax optimization.

The SARL de famille is distinguished by its unique ability to combine tax advantages (IR option) with flexibility in the distribution of income between family members. This structure makes it possible to optimize the overall tax burden of the household by dividing income according to the tax brackets of each partner. Other legal structures do not offer this possibility in such an advantageous way, making the SARL de famille a privileged tool for the transmission and management of family assets.

Expert support and practical recommendations

Managing social security contributions in a family SARL requires in-depth expertise in tax and social security law. The interactions between the tax regime (IR or IS), the social status of the manager (TNS or assimilated employee) and the distribution of dividends create a complexity that requires professional support. An error in the choice of tax regime or in the calculation of contributions can lead to costly reassessments and compromise the optimization sought.

Optimization must be part of an overall strategy that takes into account wealth objectives, cash flow requirements and desired social protection. Choosing an accounting firm specializing in specialized business sectors can identify the optimization levers specific to your situation. Although the cost of an accounting firm represents an investment, it helps avoid costly mistakes and maximize tax and social security savings. Tax declarations must be drawn up rigorously to avoid any risk of reassessment.

Frequent legislative changes in the field of social security contributions require constant legal monitoring. Contribution rates, exemption thresholds and calculation methods are regularly modified. Regular follow-up with your tax advisor ensures that your structure is compliant and that your social and tax situation is optimized on an ongoing basis, while anticipating regulatory changes that could impact your strategy.