Getting Closer to the Goal
Mountain 4: Share Capital
In order to open a business bank account you’ll need EUR 4000. This is contrary to the EUR 1 minimum the law actually authorizes, but most banks ask for a payment of at least EUR 4000 in share capital to know that you are serious about doing business.
So now you have now to pay the share capital is the company’s bank account. But as the company is not yet registered, the account is not activated. Therefore your money is blocked. This is a wonderful example of the French system - it asks you for money you haven’t earned yet because your business hasn’t opened, and then it blocks that money because your business hasn’t been registered.
But don’t worry - the capital will be unblocked as soon as the banker receives the certificate of your newly formed company (approximately 2 weeks). Then you can use this money to trade and start your activity straight away.
Mountain 5: Legal Publicity
This mountain is like a pleasant little walk in the park – all you have to do is publish an announcement in an authorized newspaper.
Have a look in the business section classifieds of Le Figaro. It’s like the births and deaths announcements but for companies. Your advert will be to announce that your company is almost ready to be ‘born’ or to trade.
Mountain 6: Incorporation
This is your equivalent of scaling Everest because things can get a little complicated – especially if you’re not French.
It’s the part where your application has to get stamped by all the different French government offices and this is where enlisting an expert guide such as a company formation agent can really help.
Your application will need to go to:
- the tax office (for the by-laws)
- the Centre des Formalités des Entreprises or Chambre des Métiers (depending on your activity)
- and finally the Greffe du Tribunal de Commerce, who are in charge of the incorporations at the Commercial Court
Mountain 7: Registered Numbers
Once you’ve managed to reach the summit of the incorporation process you will be rewarded after a few days with the all-important ‘extrait Kbis’ which is the certificate of incorporation of your company.
With this document you’ll be provided with a registered number – your company ID number - which you will have to write on all official documents and invoices.
With the Kbis, the banker can also release the share capital and your bank account will be activated. Around two weeks later, you’ll receive a welcome letter from her tax office with a VAT number and a contact of your tax officer.
Mountain 8: Accounts
You’re almost at the end of your journey, but there’s one last thing do before you hang up your mountain boots – hire a chartered accountant.
In some countries you can deal with your bookkeeping and accounts yourself and in England you can fill in a tax return on-line, no problem. But in France, we strongly advise you to appoint a professional – an ‘expert comptable’. If you get into a pickle with your taxes or accounts, the French system is not very forgiving.
An ‘expert comptable’ is a regulated professional who is legally obliged to keep you up to date with all the tax laws and is held legally responsible for the good standing of your accounts. He can also help you with VAT returns and payrolls.
The End of the Road
So there you have it. You’ve reached the end of your tricky company French incorporation journey. But now you have a whole new mountain range in front of you – it’s called your new business. May it bring you all the thrills and excitement of a real mountain adventure.