Starting a business in France: what incentive initiatives exist?
To attract businesses and stimulate economic growth in certain areas, France has several tax and social exemptions. Are you planning to set up a company in France? If so, these exemptions may be of interest to you!
1. Zone Franche urbaine – Territoire entrepreneur (ZFU-TE)
Until 31 December 2023, companies incorporated in these ZFU-TE areas are entitled to an exemption from income or corporate tax.
The tax benefit amounts to:
- +100% tax exemption for the first 60 months
- +60% tax exemption during the following 12 months
- +40% tax exemption during the following 12 months
- +And finally, a 20% exemption for the last 12 months.
There is also an exemption from employer contributions. This exemption is calculated in the same way as the tax exemption.
The areas covered by these regulations include certain districts of Roubaix, Lille (Nord department), Saint-Quentin and Soissons (Aisne department), to name but a few.
2. Zone de revitalisation rurale (ZRR)
If you establish a business in certain rural areas, or if you acquire a business there, then until 31 December 2023, you can enjoy a temporary tax exemption on profits.
The tax benefit amounts to:
- + 100% tax exemption for the first 60 months
- +75% tax exemption for the following 12 months
- +50% tax exemption during the following 12 months
- +And finally, a 25% exemption for the last 12 months.
To benefit from the exemption, the company must be located in a revitalisation zone. This exemption may be of interest to Belgian companies, as some departments bordering the Belgian border, such as Aisne and Les Ardennes, qualify as revitalisation zones.
3. Bassins d’emplois à redynamiser [HS1] – (BER)
Until 31 December 2023, companies incorporated in a BER can enjoy a profit tax exemption for 5 years.
This scheme mainly covers municipalities in the Grand Est and Occitania regions.
4. Bassins urbains à dynamiser
Until 31 December 2023, when establishing a business in certain urban areas, you are entitled to a temporary tax exemption.
The tax benefit amounts to:
- + 100% tax exemption for the first 23 months after incorporation
- +75% tax exemption in the third year
- +50% tax exemption in the fourth year
- +25% in the fifth year.
This exemption applies in more than 150 cities, in the Nord-Pas-de-Calais department (for example: Valenciennes, Denain, Béthune, etc.).
Are you planning to set up a company in France and wondering if you qualify for any of these exemptions? If so, be sure to contact our Vandelanotte France team.
We base our advice on current legislation, interpretations and legal doctrine. This does not prevent the administration from being able to challenge it or to change existing interpretations.
