Starting a Business in France 2026: Legal Structures Compared

Starting a Business in France

France has significantly simplified the process of starting a business in recent years. The creation of the Guichet Unique (one-stop shop at formalites.entreprises.gouv.fr) in 2023 consolidated all business registration procedures into a single online portal. Whether you are a freelancer, a tech entrepreneur, or opening a shop, choosing the right legal structure is the most critical decision you will make.

Auto-Entrepreneur (Micro-Entreprise)

The auto-entrepreneur regime (officially micro-entreprise) is France's most popular and simplest business structure, governed by Articles L.613-7 and following of the Code de la sécurité sociale and Article 50-0 of the CGI.

Key features:

• Revenue thresholds (2026): EUR 188,700 for commercial activities (achat-revente); EUR 77,700 for services and liberal professions
• Simplified social charges: calculated as a flat percentage of turnover — approximately 12.3% for commercial activities and 21.2% for services
• Tax options: standard income tax (micro-BIC or micro-BNC with automatic deduction) or versement libératoire (flat tax of 1% to 2.2% on turnover, if eligible)
• No VAT below the franchise en base threshold (EUR 36,800 for services; EUR 91,900 for commerce)
• No minimum capital required
• Unlimited personal liability — your personal assets can be at risk (though since 2022, the principal residence is protected by default under Article L.526-1 of the Code de commerce)

Best for: freelancers, consultants, small-scale service providers, side projects. Not suitable for activities requiring significant investment or when turnover exceeds the thresholds.

SASU — Société par Actions Simplifiée Unipersonnelle

The SASU is a single-shareholder simplified joint-stock company, governed by Articles L.227-1 to L.227-20 of the Code de commerce. It is increasingly popular among entrepreneurs who want limited liability and flexibility.

• Minimum capital: EUR 1 (symbolic)
• Limited liability: your personal assets are protected — liability is limited to your capital contribution
• President status: the president (director) is treated as an assimilé salarié (similar to an employee) for social security purposes, affiliated to the régime général
• Social charges: approximately 65-80% of the net remuneration (higher than TNS status, but provides better social protection including unemployment-like benefits)
• Corporate tax (IS): 15% on the first EUR 42,500 of profit; 25% above (Article 219 of the CGI)
• Dividend taxation: dividends paid to the shareholder are subject to the flat tax (PFU) of 30% (12.8% income tax + 17.2% social contributions) or can be opted into the progressive income tax scale
• Flexibility: the bylaws (statuts) can be drafted very freely

Best for: solo entrepreneurs who want liability protection, plan to reinvest profits, or want the social security coverage of the régime général.

SARL — Société à Responsabilité Limitée

The SARL (or EURL for a single-associate version) is governed by Articles L.223-1 to L.223-43 of the Code de commerce. It is the traditional choice for small and medium businesses in France.

• Minimum capital: EUR 1
• Limited liability: limited to contributions
• Manager status: a majority manager (gérant majoritaire) is a Travailleur Non Salarié (TNS), affiliated to the Sécurité Sociale des Indépendants
• Social charges for TNS: approximately 40-45% of net remuneration — significantly lower than SASU, but with reduced social coverage (no unemployment insurance, lower pension)
• Corporate tax: same rates as SASU (15% / 25%)
• Dividend trap: for majority managers, dividends exceeding 10% of (capital + current account + share premium) are subject to social charges at the TNS rate, in addition to the flat tax
• Bylaws are more rigid than SASU — governed by law rather than contractual freedom

Best for: partnerships, family businesses, or entrepreneurs who want lower social charges and accept the TNS trade-off.

SASU vs SARL: Quick Comparison

• Social charges: SASU (~75%) vs SARL/EURL (~42%) — SARL is cheaper but with less protection
• Dividend treatment: SASU dividends are not subject to social charges (only flat tax); SARL majority manager dividends above 10% threshold are subject to TNS charges
• Flexibility: SASU bylaws are freely drafted; SARL bylaws are more constrained by statute
• Unemployment: SASU president can potentially qualify for ARE (unemployment benefits); SARL majority manager cannot

The Registration Process

Since 1 January 2023, all business registrations go through the Guichet Unique (formalites.entreprises.gouv.fr). The process involves:

• Step 1: Choose your legal structure and draft the bylaws (statuts) — for SASU/SARL
• Step 2: Deposit the share capital at a bank, notaire, or Caisse des Dépôts, and obtain a certificat de dépôt des fonds
• Step 3: Publish a legal notice (annonce légale) in a certified journal — cost approximately EUR 150-250
• Step 4: Complete the online registration on the Guichet Unique, uploading all required documents (ID, proof of address, bylaws, legal notice, certificate of deposit)
• Step 5: Receive your SIRET/SIREN number and Kbis extract (company registration certificate) typically within 1-2 weeks

For auto-entrepreneurs, the process is simpler: register online via the Guichet Unique with just your ID and proof of address. No bylaws, no capital deposit, no legal notice. You receive your SIRET number within a few days.

Ongoing Obligations

Once registered, businesses in France must comply with ongoing obligations including:

• Annual accounts: SASU and SARL must file annual financial statements with the greffe du tribunal de commerce
• TVA declarations: monthly or quarterly, depending on turnover
• Social declarations: DSN (Déclaration Sociale Nominative) for companies with employees
• Corporate tax: advance payments (quarterly acomptes) and annual settlement

How DroitAI Can Help

DroitAI can help you compare business structures for your specific project, estimate your social charges and tax liability, understand the registration process, and identify your obligations as a business owner in France. Describe your entrepreneurial project and our AI will guide you through the applicable legal framework.