Support for business start-ups in the French overseas departments and territories (DOM-TOM / DROM-COM)

Are you a contractor living in the French overseas departments and territories (DOM-TOM / DROM-COM)?

It's important to find out all you can about business development assistance in the French overseas territories of Martinique, Guadeloupe, French Guiana, Mayotte, Saint Barthélémy, Saint-Martin, Saint-Pierre-et-Miquelon and Réunion.

They come in various forms (social, fiscal, financial), and it would be a shame to miss out on this valuable support for your company's development.

In order to help you identify these aids, but also to shed light on the steps you need to take to obtain them, this article focuses on the existing aids for business start-ups in the DROM-COM! 

Social assistance

A number of social benefits are available to entrepreneurs in the DROM-COM

The possibility of a 24-month exemption from social security contributions: individuals developing or taking over an entrepreneurial structure in the French Overseas Territories can obtain a partial exemption from the social security contributions normally payable by such a business, for a maximum period of 24 months, in accordance with Article L756-5 of the French Social Security Code.

However, such a structure must have revenues below a clearly defined amount.

The existence of specific procedures for calculating social security contributions for the self-employed: from the third year of business, companies are considered to be in "cruising mode".

Once this system is in place, self-employed contractors are required to pay a certain number of Social Security contributions.

In the DROM-COM region, a deduction can be made from the latter for entrepreneurs whose income is less than 250% of the PASS or Plafond Annuel de la Sécurité Sociale (annual social security ceiling).

Social assistance for micro-entrepreneurs: as in mainland France, micro-entrepreneurs are subject to monthly or quarterly social security contributions. The rates for these contributions are specific to DROM-COM.

Tax incentives

There are two types of tax incentives: investment incentives and ZFA-related incentives.

Investment grants: in several business sectors, companies liable for corporation tax (impôt sur les sociétés - IS) or income tax (impôt sur le revenu - IR) can obtain tax assistance for their "productive" investments.

The definition of overseas departments as ZFAs (Zones Franches d'Activité): any company located in a DROM (and not in a COM) by December 31, 2019, will be eligible for partial or total exemption from a number of taxes, subject to a number of conditions:

• Income tax
• The CET or Contribution Economique Territoriale, comprising the CFE or Cotisation Foncière des Entreprises and the CVAE or Cotisation sur la Valeur Ajoutée des Entreprises.
• Property tax on built-up areas

Financial assistance

Finally, companies located in the French overseas departments and territories (DROM-COM) can benefit from financial assistance.

Here again, financial assistance can take two forms

• Aide au " Projet d'Initiative Jeune " or PIJ: this is aimed solely at young entrepreneurs, but also at young business owners located in the French overseas departments and regions (DROM), and enables them to obtain assistance of up to €7,320. An amount that can prove useful when launching a new business.
• National financial aid: like "loans of honor", business start-ups and takeovers in the DROM-COM can be awarded national aid depending on their status. These can take several forms, depending on the department to which they belong.

In conclusion, setting up a business in the French overseas departments and territories can offer entrepreneurs numerous social, tax and financial advantages.

However, it's important to bear in mind that it takes much longer to set up a business in the French overseas territories than in mainland France. So don't forget to plan ahead!