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JEI exemption tax filing

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CONTEXT

Businesses created before 31st December 2019 that invest in R&D projects and have JEI/YIC¹ or JEU²status, can take advantage of tax cuts and social contribution exemptions for the 8 first years of their existence.

CONCLUSION

The JEI status is a very friendly tax scheme for young businesses, however the French administration is known for its extensive red tape. You are required to meet certain criteria in order to be granted this status, and it is important to have the administration confirm that you qualify as a JEI.
Maupard can help you through the different steps, thus ensuring a smooth process.
It is possible, in some cases, to combine a JEI exemption with the CIR R&D Tax Credit and benefit from a 30% tax credit on your R&D expenses up to €100m, and 5% thereafter. Companies with the JEI status can even ask for an automatic refund of their CIR Tax Credit!

¹ Jeune Entreprise Innovante or Young Innovative Company

² Jeune Entreprise Universitaire

THE STEPS

I. First contact meeting and gathering information

Understanding of the objectives of your project in France, clarification regarding your R&D approach and making sure that you meet the specific criteria applicable to this exemption.

II. Collection of supporting documents as an evidence that your company:

Is an independent SME
Is newly created and less than 8 years old
Has at least 15% of expenditure allocated to R&D projects

III. Preparation of your application and Ruling

Introduction of a ruling from the French tax administration to secure your tax exemption. Please note that this request must be repeated every year; one ruling from the tax administration does not cover the whole period of exemption, i.e. the first 8 years of your company’s existence

IV. Follow up

Coordination and chasing the administration to reply within the next 3 months[1]
Receipt of your ruling: your status as a JEI is now secured.

V. Receipt

Declaration of your status to the Tax administration within the 9 months of beginning activities.[2]

At this point the service has been completed and your company is all set to start business in France! Congratulations!

If you want to know more about the JEI exemption tax filing or the CIR R&D Tax Credit, please see our articles on the subject (article n°55), or feel free to contact us directly.

[1] If the tax administration does not reply within this time, your exemption is implicitly accepted.

[2] for newly created companies or the current year for pre-existing companies

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JEI exemption tax filing

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CONTEXT

CONCLUSION

THE STEPS

I. First contact meeting and gathering information

II. Collection of supporting documents as an evidence that your company:

III. Preparation of your application and Ruling

IV. Follow up

V. Receipt

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