Individuals who are driven, motivated, and have a product or service they believe in should consider starting a business in France. Running your own business is an incredibly rewarding experience. In addition to setting your own hours and working on something you can be proud of, you can choose your co-workers, contractors, and clients.
There are numerous benefits to running your own company. For many people, steep start-up costs are what prevent them for pursuing this dream. Thankfully, filing the paperwork required to start your own business in France is free, and takes less than five days. This gives you the freedom you need to turn your dream into reality. If you are wondering how to set up a business in France, take a look at the guide below.
Before you can learn more about starting a business in France, you need to know if you qualify. Thankfully, it is fairly easy. All you need to have is a residence permit. Residents of the EU are also permitted to create companies in the country. It is also important to have some knowledge of the process before starting a business in France, to ensure you file everything properly.
II/ Business Categories
When starting a business in France, you need to know your category. Business categories determine which registration center you must use when filing your registration paperwork. There are five business categories:
- Commercial or industrial
- Trades and artisan
- Independent or freelance professional
- Commercial agent
Since you can file your paperwork online without consulting with registration staff, be sure you have selected the right category. Failure to do so can result in your application being rejected.
III/ Starting a business in France : choosing a Legal Structure
Once you know which is the most appropriate category, you need to then decide on a legal structure for your company. The legal structure also determines the type and amount of tax your business must pay. There are two legal structures in France: sole trader and a company. The best structure for you may depend on numerous factors, including the type of company you want to run, the level of protection you want for personal assets, and how you want to pay tax.
A) Sole Trader
A sole trader is a person who runs their company on their own. Under the law, the individual and their business are the same legal entity, with all professional and personal assets being intermingled. Instead of paying commercial or corporate tax, the profits earned by sole traders are treated as income. This means they are paid by way of income tax. Depending on the type of business you run, this could save you a lot of money. Alternatively, it could mean you spend more than you need to in taxes. Speaking with an accountant can help you make this decision.
Sole traders are permitted to file certain declarations or to set up their company using various business models to protect their personal assets. Filing a Declaration of Seizure protects a person’s home from being seized should the company fail to pay its debts. It is also possible to operate the company as an Entrepreneur of Individual Limited Liability, which protects personal assets. People who opt for this status are also permitted to pay corporate tax instead of income tax on profits.
If operating as a sole trader seems too risky for you, and your profession permits, you can choose to set up your business as a company instead. This means that your assets are kept separate and apart from corporate ones, offering an extra level of protection. When you create a company, you must also pay corporate taxes, appoint officers, and publish legal notices if you intend to change your company name.
There are two types of companies in France. The first is an EURL, which is owned and operated by a single person. A SARL is the second type. It is a company owned and operated by at least two but no more than 100 people, with liability being limited to the capital investment. This means that owners cannot lose any more than they invest in the company.
IV/ Choosing a Name
Regardless of your legal structure, you need to select a name that is not otherwise in use in France. This search can be done for free using the INPI. You can also register a company name, logo, or trademark through the same office.
If you are thinking of starting a company in the EU, doing business in France may be your best choice. Thanks to legislative changes made in 2015, setting up a business in France is now easier than ever for residents and non-citizens alike. There are fewer steps than other G20 countries, and the entire process takes much less time. In addition, your start-up expenses are lower. If you are thinking of starting or running your own business, France is the perfect place.
LegalVision will help you in your legal enquiries:
- Legal questions: Our team of lawyers is available to answer all your questions via email (firstname.lastname@example.org) or phone (05 35 54 57 42). You can rest assure we will provide you with all the answers, options and information you request.
- Business administration: Our lawyers will register a business for you in France. You’ll be enlisted rapidly, accurately and without any blunders to start your business. We will deal with the entire procedure.
- Administrative work: Enlisting a business in France demands a good amount of administrative work monthly to comply with the different French authority fiscal obligations. Also, some enrolment issues may emerge and will need to be addressed. We make sure the all process will work smoothly. We have register over 20.000 companies in France since 2014.
- Call Center: We have a team of experienced lawyers ready to answer your questions in English or French. We are open from Monday to Friday, from 9AM to 7PM.