About Creating a Business in France
Many individuals
delight in the idea of creating a new business in France, or extending
an existing one into France. There is a kind of frontier feeling
about it, opening up new territory, bringing over new ideas or technology.
We have advised many individuals and companies as to the best way
to set up their business in France, avoiding pitfalls.
A foreigner setting up business in France will
come head to head with a system much different from that in his
or her home country. In addition to language and cultural differences,
France has a complex and potentially onerous tax and social security
structure. Its bureaucracy is daunting. Despite these obstacles,
with thought and planning, many headaches can be avoided.
Correct choice of the appropriate legal
form for the business is indispensable. Some of the factors to be
taken into account are:
- Ease of obtaining the appropriate visa
- The nature of the intended business activity.
For example, translators, consultants and art dealers often opt
to become self-employed; a sales venture normally calls for the
corporate form.
- Tax considerations.
- The number of business investors.
- Whether a clientele is already identified
or has to be developed.
- The amount of initial investment required.
- Whether limitation of liability is a factor.
- Whether the need for simplicity of administration
outweighs other factors.
An understanding of the French system is fundamental.
Tax and social security implications as well as the hazards of hiring
and firing employees need to be studied.
We are often queried as to whether a foreign-based business can
operate in France.
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Self-Employment Issues
("Travailleur Indépendant")
- We help you decide whether the self-employed
form of doing business is best for your needs.
- Your visa application - we prepare
it and submit it for you to the appropriate authorities.
- Tax issues - we explain all tax issues
affecting you as a self-employed - income tax, CSG, VAT,
doing business taxes.
- Social Security issues - we explain
this high-cost item and look for possible exemptions.
- Legal formalities - we help you to
register your self-employed activity with all necessary agencies.
- Tax returns - we prepare all U.S. and
French tax returns.
- Estate issues - we advise self-employed
on the impact of French and/or U.S. estate issues.
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Creating a Corporation
- We help you decide whether to create
a separate corporation or branch office.
- Choice of French corporate form - we
compare the various corporate forms (SARL, EURL, SA, SAS),
to identify which is suitable to your business needs.
- Representation office (Liaison office)
- we explore whether this form of non-taxable entity is suitable
to your business needs.
- U.S. or other affiliate - we explore
whether a multi-corporate structure
is appropriate for your business.
- Formalities: We create the French entity,
register its name and complete all other formalities.
- We help
with all phases of getting your new business off the ground,
including opening your bank account, negotiating a business
lease, defining and explaining the role of the legal manager
("gérant"), hiring employees, et al.
- We help you to understand the special
income tax and Social Security problems of the owner-employee.
- We explain and assist with visa and
work permit applications for you as owner/manager as well
as other employees.
- We assist with business tax issues
such as TVA, social security charges, taxe professionnelle,
and others.
- We prepare your U.S. and French personal
income tax returns and, if you create a French company, prepare
Form 5471 for the U.S.
- 1901 Association (tax-exempt) - we
explain what this is and how it works.
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Creating a Partnership
- We explain how French partnerships
differ from U.S. partnerships - legal and tax issues.
- We create the partnership agreement
and assist with filing formalities.
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Income Tax Issues
- We advise on the full range of income
tax issues affecting the individual who is operating a business
in France.
- We help you to understand the French
tax system as it applies to your particular business entity
and, if you are an American, we help you to report your business
income correctly to the IRS We show you how to take advantage
of all exclusions, tax credits, differences in the two tax
systems. We show how to utilize start-up losses for maximum
tax benefit, how to maximize the available of exemptions,
exclusions and deductions under French and U.S. tax law.
- We explain the "avoir fiscal" system
that helps to reduce tax on dividends.
- We prepare all necessary tax returns
for France and the U.S.
- We explain how supplementary taxes,
such as the CSG and the "taxe professionnelle",
will impact on your business.
- We explain how business assets are
exempt from the French wealth tax.
- We guide you through the French gift
and inheritance rules that apply to business owners.
- We prepare tax returns for the business
and the business owner, and work with accountants who maintain
account, advise on day-to-day operations and prepare French
corporate returns.
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Social Security Issues
- We help secure the benefits of the U.S.-France
Social Security Treaty -- which allows Americans to remain
in the less expensive U.S. Social Security system for for a
limited period of time.
- We explain the French Social Security
system and help, if possible, to minimize exposure to this
often-burdensome tax.
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Tax Returns
- As explained in other places in this
website, we are able to assist you in the preparation of tax
returns required by both the French and U.S. taxing authorities,
such as income tax returns, compliance returns for the IRS
reporting the ownership of foreign corporations, reports of
foreign bank accounts. In some specialized areas, such as filing
French VAT forms, French social security forms required for
employees, and the like, we help you to locate qualified accountants.
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About Visa and Work Permits
We work hand in
hand with you (and your employer if you are coming to France
as an employee) to:
- Review your situation and options
- Advise on available choices for your
intended type of work and/or sojourn in France
- Assist in the preparation of applications
for you and your family for visa/work permit/resident permit
- Track application and keep you informed
- Accompany you and your family during
French registration procedures
- Monitor and assist with renewals
- Respond rapidly to your needs and questions
as they arise during or after the visa/work permit/resident
permit application process
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