When setting up a business, it is necessary to decide on its legal status. To choose it well, you have to think about your project and find the one that will be best suited. It is essential to be aware of the different forms that exist, but also of their advantages and disadvantages. At the same time, you must take into consideration many criteria that will allow you to make the right choice, such as the type of activity carried out or the number of people who will work in the company.
The legal form of a company is decisive. It has fiscal and social consequences on the activity and directly impacts the private lives of entrepreneurs. To find the right status, several criteria must be taken into account. Here is a non-exhaustive list.
Self-entrepreneur status offers the possibility of creating a simplified business. This auto-enterprise (AE) also called micro-enterprise allows you to start your own activity or to have a part-time activity in addition to being an employee. This status offers administrative, accounting and tax relief. Revenues are limited. Social charges are calculated on the basis of turnover and an allowance is applied to taxable profit.
A Sole Proprietorship (IE) is easy to set up. All you have to do is register at the business formalities center (CFE). This exercise in own name does not distinguish between the legal entity and the entrepreneur. Moreover, professional and personal assets are confused. The entrepreneur does not pay himself a salary.
The sole proprietorship with limited liability (EIRL) works like the sole proprietorship. However, it allows the entrepreneur to protect his personal property.
Like the EIRL, one of the advantages of the sole proprietorship with limited liability (EURL) is that entrepreneurs can limit their liability in the event of the bankruptcy of their activity. This single-member company helps project leaders to launch themselves without risk.
The simplified joint-stock company (SAS) has many advantages and above all great freedom in operation and organization. The partners define, draft and sign the articles of association together. This approach requires knowledge.
The one-person simplified joint-stock company (SASU) offers the same advantages as the SAS but for one partner only. Its responsibility is commensurate with its contribution. It should be noted that the SASU is the most popular legal status for start-ups, also called innovative companies.
A limited liability company (SARL) allows its partners to protect themselves. No family or personal assets are involved. The SARL is the most used legal form in France since nearly 40% of companies have opted for this status. It has between 2 and 100 partners. The contribution of share capital is mandatory but the amount is free.
The public limited company (SA) is the legal form of large companies. To create an SA, it is imperative to have a minimum capital of €37,000 and at least 2 partners. Please note that an SA listed on the stock exchange must have at least 7 partners. It is not uncommon for a SARL or SAS to become an SA because to operate, this legal form requires economic development.
The status of liberal practice company (SEL) was designed for people exercising liberal professions. The latter can come together and carry out an activity together. This opportunity makes it possible to reduce operating costs and create a common clientele.
The liberal exercise company comes in different forms:
The status of young innovative company (JEI) is intended for companies that devote a significant part of their budget to research and development. This legal form is accompanied by tax and social exemptions.
A young university enterprise (JEU) is subject to the same constraints as the JEI. It must also belong to research professors or students up to 10%. The main activity of a GAME revolves around research work previously undertaken.
