Characteristics of the notarial function
A notary is a legal professional who has jurisdiction to draft and certify contracts as authentic acts for their clients, giving them a legal date. They also keep records, or minutes, of these authentic acts and can provide official copies of them. Notaries are public officers appointed by the Minister of Justice.
Who operate as self-employed professionals.
Houdart A&C has extensive experience in accounting, legal and taxation regulations and requirements for notary firms.
There is a specific chart of accounts for notaries. Notaries also have to respect significant accounting requirements, set forth in Decree No. 45-0117 of 19 December 1945, which governs the activities of notaries. Our software is specifically designated for notary-related accounting processes, which are described below.
Notaries must comply with record-keeping obligations:
- The cash ledger contains daily accounting transactions, and is numbered by article. It is initialled by the president of the Chamber of Notaries or a delegate.
- The securities ledger, also numbered and initialled, contains documents attesting to client monies which are held in escrow by the notary and scheduled to be returned at a future date.
- The general ledger includes general and client accounts. It is a complete record of all payables/receivables organised per client.
- A ledger of act-related expenses is a chronological record of the acts notarised by the notary in the name of the principal and the detailed notarial fees and disbursements for each act.
- Quarterly account balance ledgers.
Notaries must provide receipts for payment indicating date of payment, name and address of the paying party, in accordance with the Ministry of Justice template.
Beyond general accounting requirements, it is key to distinguish the monies that are managed on behalf of a third party from income from notarial fees and disbursements during data entry of notary office transactions. Money in escrow that belongs to third parties must be kept in an account that is separate from notary firm’s operating account, which is overseen by the French Deposit and Consignment Fund (Caisse des dépôts et consignations, CDC).
Notaries can work as sole traders, in professional partnerships (société civile professionnelle, SCP), or in private practice firms (société d’exercice libérale, SEL, of which there are several forms, including: limited liability [société d’exercice libéral à responsabilité limitée, SELARL], and joint-stock [société d’exercice libéral par actions simplifiée, SELAS]). The law of 6 August 2015 gave notaries the possibility to be partners in a company with financial holdings made up of professionals from one or more sectors (société de participations financières de professions libérales, SPFPL).
This so-called “Macron law”, which aims to promote economic growth, activity and equality, gives people in regulated professions a choice of where they wish to set up shop; a map of areas where their services are thought to be needed is updated every two years. The law also revised the regulated fees that notaries charge their clients, and modified business activities that notaries can carry out.
If they are self-employed or work as partners in tax-transparent professional partnerships (société civile professionnelle, SCP), notaries’ income is taxed on non-commercial profits (bénéfices non commerciales, BNC). Private practice firms (société d’exercice libérale, SEL) are subject to corporate income tax. Individually-run limited liability private practice firms [société d’exercice libéral à responsabilité limitée, SELARL] are the only exception to this rule, although they can opt to pay corporate income tax as well.
Notary services are subject to standard VAT rates. Disbursements are excluded from the VAT tax base when the conditions of ordinary law are met (prior and explicit mandate, for example).
Collective bargaining agreement
The national collective bargaining agreement for notary services of 8 June 2001 applies to the profession. The full text is available on Légifrance.
The High Council for the Notarial Profession (Conseil Supérieur du Notariat, CSN) has national jurisdiction and is the highest authority of the professional organisation.
Regional councils and departmental chambers organise and supervise the profession in the French regions and departments.