Validating a business creation project: what are the stages?

Setting up your own business is never a smooth ride.

Whether legal, fiscal, financial, social or - quite simply - administrative, all questions need to be validated at this point, before you take the plunge.

For many entrepreneurs, this is a crucial moment.

To successfully launch your project, no question should be left to chance.

Your legal status

There are a number of points to consider when making the right choice:

• The compatibility of your legal status with your chosen tax regime.
• Its compatibility with the manager's social status.
• Its compatibility with the company's specific characteristics, such as the number of associates or the amount of share capital .

If you wish to limit your liability to the amount of your contributions to the company, opt for a SARL, EURL, SAS, SASU, SA or EIRL.

If you wish to be remunerated in the form of dividends, opt for a SAS, SASU, SARL with equal or minority management, a EURL with a non-partner manager or a SA. It is also possible to opt for another status offering remuneration in the form of a salary.

In an EIRL or SARL, managers are non-salaried workers. On the other hand, the chairmen of SAS and SA companies, and the minority and equal partners of SARLs and EURLs, are treated as salaried employees.

Your tax situation

You can choose to be taxed either on income tax or on corporation tax. If you opt for income tax, profits are taxed directly in the name of each partner. Sole proprietorships, EIRLs, EURLs, SNCs and non-trading companies are taxed under the IR system by default.

In the case of a company subject to corporate income tax, it is the company that bears the tax burden.

Associates are remunerated through dividend payments

EURLs with a single legal entity shareholder, SARLs, SASs, SASUs, SAs and SCAs are taxed under the corporate income tax regime by default.

The choice between these two options is made with a view toreducing your tax burden. Consider the impact of each on the payment of social security contributions.

Your head office

The choice of your head office address is a strategic point, reflecting your company to all your stakeholders.

There are several options to choose from:

• Commercial domiciliation enables a company to obtain a head office address through a domiciliation company. They take care of many of the day-to-day tasks involved in employee life, such as receiving, processing, scanning and forwarding mail. This alternative allows you toset up your business at a lower cost, as the services of a domiciliation company start at just a few dozen euros a month.
• Renting commercial premises is a more expensive solution, and commits you to a contract. And paying rent isn't always easy for a start-up. You also need to find a guarantor, or tie up assets with your bank.
• The executive's personal residence is a false friend. It may appear simple, but it has many hidden disadvantages. Confusing registered office with home means you have to make your personal address public. Finally, not all private rental contracts allow you to domicile your company at home. Sometimes, co-ownership regulations prohibit it.

Your business start-up grants

A number of government grants are available to entrepreneurs, depending on their status and project:

• ACRE is evolving this year, and it is now possible to benefit from it as a self-employed worker or through a company. Among the eligible types of company are SA, SARL, SAS, SARL, SELARL, SELA and SELAS. Under certain conditions, the company is exempt from social security contributions.
• ARCE is the "Aide à la reprise ou à la création d'entreprise" (support for business start-ups), which entitles the entrepreneur to 45% of the amount of his or her remaining benefits when starting up a business. A second payment is made six months after the first. A 3% deduction is applied to the capital sum.
• NACRE is a 3-year minimum support scheme to facilitate the creation or takeover of a business. A wide range of services are provided, from project set-up to structuring the financing plan, including operational advice on launching the business. It's even possible to obtain financing directly through this scheme, with a zero-interest loan of between €1,000 and €8,000 for up to 5 years.

Checking each of these steps is crucial to launching your project, and optimizing its chances of success.

To make the best choice, don't hesitate to seek the advice of a professional, who will be best able to guide you.