What are the tax implications of setting up a company?

What are the tax implications of setting up a company?

The creation of a company is not limited to the realisation of an entrepreneurial project: it also has a number of consequences tax that it is essential to plan ahead.

From the very outset, various costs may arise, whether in the form of direct taxation, registration fees or taxes relating to capital contributions.

Understanding these mechanisms not only helps to avoid unpleasant surprises, but also enables you to optimise the legal and financial structure of your business.

Recording contributions

As a matter of principle, the contributions are not subject to registration fees under the’article 810 of the CGI.

This exemption applies to all contributions made when the company is incorporated, regardless of their nature.

This principle has a wide scope: where contributions are registered free of charge, all deeds and documents drawn up in connection with the incorporation of the company (articles of association, annexes, declarations) are also exempt from charges, in accordance with the’article 810a of the CGI.

However, there are some exceptions.

In fact, certain contributions are treated as transfers for consideration, particularly where assets such as a building, a business, a client base or a right to a lease are contributed to a company subject to the’corporation tax by a person who is not themselves subject to it (article 809 of the CGI).

In this case, contributions may be subject to proportional duties for immovable property and property rights, or in accordance with the scale applicable to business assets.

Nevertheless, there are mechanisms in place to mitigate this. These rights may be waived if the contributor undertakes to hold the securities received in exchange for a minimum period of three years.

Should this undertaking not be honoured, the amounts due shall become immediately payable.

The publication of a notice of incorporation in a legal gazette

When incorporating the company, the partners must draw up the articles of association but also to publish a notice of incorporation in a legal notices journal.

The price list is set by the Order of 19 November 2021 concerning the pricing and procedures for the publication of judicial and statutory notices.

The cost of this publication varies depending on the department in which the company is incorporated and the type of company chosen.

For example, the cost of an advert for the creation of a SAS in Corsica is €199, whilst it is €148 for a SARL.

The costs associated with registering the company

L'registration The incorporation of a company is an essential step. It enables the company to be registered with the Commercial and Companies Register (RCS), thereby conferring full legal personality upon it.

Before it is registered, the company is said to be «in the process of being formed» and therefore cannot enter into contracts directly with potential business partners.

In order to register the company validly, it will be necessary to have completed all of the incorporation formalities (drafting the articles of association, depositing the share capital, publishing the statutory notice, etc.).

Thus, registration with the RCS The cost of setting up a commercial company is €33.83. This cost rises to €60.38 for other types of company.