Advice/help on starting up in business

[Rob G]

I am resident in France (Haute-Normandie) and am thinking of setting up my own home-based business.

I am well aware that setting up in France is no easy matter, and do not underestimate the impact of bureaucracy, social charges, tax etc. etc. There is no shortage of advice on this forum and elsewhere as to the dangers, the need to be realistic, how hard it is - all of which is good advice, but.....

...it needs to be balanced by positive and optimistic advice too. There must be someone out there who has "successfully" set up in business, manages to make a decent living (I know that's subjective) and is happy doing what they're doing. If you fit this description and would be happy to share some of your experience and advice with someone contemplating going the same way, please send me a PM.

Thanks,

Rob

[Butchx5]

Hate to suggest it but what's that saying:

'silence says a thousand words'

PLEASE someone respond in a positive way and give us all hope!

[Val_2]

How can anyone respond when we don't know much in the way of details such as the type of business etc. A lot of us on this forum have businesses here but without knowing details we cannot give info relevent to our own experiences but what I will tell is whatever you set up in here be prepared to earn a lot less than you can in the UK and pay heavily in social and other charges here.

[Eslier]

If you have money in the bank to cover your social charges for the first year and you build this into your business plan then, providing you have a business which will make some decent income then there isno reason why you should not find it easy.

You will need to allow about 4000€ for social charges  in year one  (regardless of whether you have any income or not) and probably best to allow another 1000€ for accountants fees etc.

The problem in France isn't the setting up of a business, it is finding a business which will generate enough income to provide enough gross profit to cover your overheads.  Prepare your cashflow projection spreadsheet and see what it looks like. If you think you can make enough money then go for it. Using an accountant will take all the bureacracy away and all you have to do is sign the cheques !   

[zeb]

Hi Rob and Butchx5

We're happy!

[chris pp]

I'm with Zeb,  we manage OK, difficult to add much more without knowing what you intend to do, it doesn't have to be as bad as some like to paint it, but then I"m happy without to much.

Chris

[Rob G]

I didn't go into details in my post, as I was looking for someone who might be able to give general

advice along the way, rather than discussing all the details now.

That's why I asked for anyone willing to help to send me a PM.

I never said I was looking for it to be easy! I know enough about

running a business, and enough about France, to know that this would be

fantasy. What I was looking for is the approach that zeb and others

have given - positive but tempered by realism.

Anyway, thanks to those who have replied positively.

I am looking into working on a freelance basis in one, some or all of

the following areas: technical translation, building web sites (French

and English), teaching English, and possibly one or two other areas as

well.

Rob

[Remy Martin]

You're right to stay positive and believe in yourself Rob.

The simple fact is that you're likely to be less well off over here but that you'll find you don't need to spend on those "must have" things in the UK.

I started here in 2003 and whilst the cotisisations are heavy I manage to feed my family of four and will do my utmost not to get dragged back into the 9-5 (actually 7.30-8.00) corporate world.

Best of luck my friend.

Graham

[Rob G]

Hi Graham,

Thanks for your encouragement. You have summed up my philosophy entirely.

By the way, I had a look at your website - it looks fantastic. As an

ex-marketeer in the UK, I think you've done a really good job. And what

a great business to be in.....

Rob

[tj]

Hi Rob

There are vastly more experienced expats in France than myself, unfortunatly they are too busy getting on with their lives to be reading these columns.

Myself. I look in now and again to see if there is anything useful, we are new to this, coming upto the end of our first year. What I can tell you is that it is relatively easy to register a business here, you will here people calling it bureaucracy, but the real issue is lack of language and understanding, imagine the language here was english, how easy would it be? You need to find someone who speaks both english and french and its a piece of cake!

You will hear people talk about some 4000euros in social charges for the first year, correct from one point of view, but not entirely, as with any tax system and I include health, social and income tax, at the end of the day you pay a percentage of your income. But when you are just starting out here worried, and uneasy about the future, someone says you need to pay 4000 euros before you even start, not good!

I can tell you, if neccessary, you certainly do not have to pay the cotisations, except for a approx 1000 euros to maintain pension and health rights, which you have to pay even if your income is nil. If you have a liability payments can also be arranged to suit you, upto a point, so its not all doom and gloom.

If your here for the duration then dont worry about it!

best of luck!!!

Tim 

Rules, for the obedience of fools and the guidance of wise men.

 

 

[Rob G]

Hi Tim,

Thanks for your post and your useful insights. I have the benefit of

speaking fluent French, but I certainly understand how daunting the

language barrier makes the whole thing for many people. On the whole,

since I spent a year in France 13 years ago, I see noticeably less

bureaucracy and pointless hoops to jump through than I did back then

(I'm talking about in general, not specifically in relation to

registering a business).

We went down to the URSSAF office the other day and spoke to a very

helpful chap who gave us lots of info and explanations about the

process of registering, the different bodies we would have to pay

cotisations to, etc. I'm going to start going through it all in detail

tomorrow.

Clearly the big question for anyone contemplating starting up in

business is what if I don't make any/enough money? This is where the

question of yr 1 social charges comes in. I'm interested in your

comment that you can reduce these right down to about 1,000 euros - are

you referring to the year 1 "exoneration" whereby new businesses can

defer their payments and then pay them over the following five years,

or is this something else you're talking about? I'd be very grateful

for any more specific information you can provide.

Thanks again,

Rob

[tj]

Clearly the big question for anyone contemplating starting up in business is what if I don't make any/enough money? This is where the question of yr 1 social charges comes in. I'm interested in your comment that you can reduce these right down to about 1,000 euros - are you referring to the year 1 "exoneration" whereby new businesses can defer their payments and then pay them over the following five years, or is this something else you're talking about? I'd be very grateful for any more specific information you can provide.

No!

I am talking about paying exactly what is due, I am about to pay the charges on our little enterprise's activity last year, and it basically is the minimum charge for pension and health, and nothing to Urssaf, thats it, nothing deferred. The trick is this, when you register you can elect to pay cotisations after declaration of the first years trading.( I should say that we have registered a micro enterprise, I did that because Chamber of Commerce said it was the cheapest, haha) As a micro enterprise we just need to declare the total income, the tax office then deduct 72% for our costs ( depends on the kind of business ), expenses etc and the cotisations and tax liabilty are calculated on the remaining 28%, there is a ceiling on this type of system, I think its 27,000 euros or there abouts. A great way to start out, get into the system, health cover etc etc. And as things progress the chosen system or regime as they like to call it, will need to be revised.

The main point is, the only thing you need to worry about in the first year or two is earning!!

I have to ask others reading this, because something bothers me a little, I keep hearing about how expensive it is, how the social charges are overwhelming, and especially from one poster, how to expect to earn a lot less here than UK! if its all so bad how are they surviving and why not go home?

regards

Tim

[Debra]

I suspect because they are home.

[Will]

Although it is possible to pay reduced cotisations in the first years, this has to be approached with considerable care. For one thing, you are only deferring what is due - what you don't pay in the first year or two will have to be paid at a later date. Also, if you claim a low payment based on an estimate of your earnings, then find you have earned more, you can be penalised quite heavily (unsurprisingly, it doesn't work the other way round). Do get yourself a good accountant early on who can guide you through such things.

I think the reason why things are perceived to be so complicated and expensive is that in Britain you pay tax and NI to, in practical terms, just one body, in arrears, which covers all your basic deductions and makes it easier to budget. Other things, like private medical insurance and additional pensions, are optional. In France, you have to pay to countless different bodies, many direct and some under the URSSAF or similar umbrella. Most are compulsory - you cannot avoid or defer them. In many cases it is unclear exactly what you are paying for - there are three or four things under the general heading of 'viellesse' (old age) for example. So until you get used to it it just looks like constant outgoings, some, like medical cover, paid partially in advance, others, like taxes, in arrears, so it makes cashflow predictions very difficult.

Also, many British seriously underestimate the amounts, think they can undercut other tradesmen etc to get work, then find after a year or two of trading that they have been seriously undercharging. It is very difficult to put prices up once quotes have been given, so a big problem.

With good advice, a good service or product offered, good marketing and a lot of luck there is no reason why a business in France should not work. But to be realistic, a lot of newcomers do get it wrong, and it often feels as if the system is geared to deter enterprise (which in some ways it is) when it really ought to be encouraging it, in order to help France's serious unemployment problem. And there's another paradox - if you can somehow declare yourself unemployed then there is help available for business startups. But because most people wanting to start a business have not been employed in France, so cannot, strictly speaking, become unemployed, this help is not available to many.

[Bob]

 Hi Rob,

My hubbi, Bob, pointed me to your question re: setting up a business.

I find this subject quite interesting as I am in the process of applying to start my own business as I am a qualified holistic therapist.

I studied in the UK for 5 years at extreme expense to myself to get qualified.

I have since discovered that to gain employment in my particular field here in France, I would have to re-qualify with the equivalent French body, which is further expense and more years of studying (the same subject, may I add). So, no go there....

I registered as un-employed some months ago without any hassle. The only info my local ANPE required to allow me to register was copies of my last P45, and  any details that I had of my salary and employment in the UK.

So, not having secured employment since I registered, my Councellor at ANPE has directed  me to my local Chamber of Commerce for assistance in setting up as self-employed. I have been told that  because I have been registered un-employed for 6 months, the up-front costs are zero.

I have yet to find out the validity of this when I go to the Chamber of Commerce next week. (No doubt some readers will know different......)

But, if I find anything of value to you, or indeed, anyone else in my situation, I will pass the info on......so....watch this space......

Sorry I cannot help further at this stage...

Bob's better half...

[Rob G]

Hello Bob's other half (sorry, I don't know your name!),

You qre more or less right that you will be entitled to "exoneration"

of the first year's social charges. This is true of new start-ups where

the owner is either in receipt of unemployment benefits, or failing

that, they have been registered as unemployed for at least six months.

I think you will find that there are still some first year charges you

have to pay - tax (although should be mininal if you register as a

"micro-entreprise"), and one or two other bits like a contribution to

national debt repayment etc. Shouldn't be much though.

I thought about going down the whole chamber of commerce route, but as

I'm looking at going into what is termed "les professions liberales",

my first point of contact was the local URSSAF office, who were very

helpful and informative. The CCI offer a five-day course in starting a

running a business, but I think this may be a bit overkill for me. (I

think most CCIs run the same course - it's called "5 jours pour

entreprendre" and where we live it costs 150 euros.)

Anyway, unfortunately I can't avoid the first year charges unless I

wait until I've been registered unemployed for six months - this would

be July. I can't afford to wait that long, so I think we'll be taking

the plunge sooner rather than later, charges and all! Having spent

about two whole days last week reading through various web sites about

social charges and the different "regimes", my head was virtually

spinning at the end of it.....but hopefully I will soon become an

expert in the field!

By the way, given that you can't exercise your desired profession in

France without re-qualifying, what line of business are you going to go

into?

Let us know how you get on.

Rob

[Ty Korrigan]

Dossier ACCRE.

[Rob G]

Hello Ty,

Thanks for the suggestion - I've already had a look into it and it appears I don't meet any of the conditions which would allow me to qualify.

Rob