WORKING FROM HOME

This is an attractive and economic solution for many types of new businesses. It will undoubtedly appeal to a lot of foreigners who have moved to France to buy a better home and enjoy nicer surroundings. Although regulations make it increasingly easier to set up home-based businesses, strict discipline and organisation are necessary to ensure that family life will not intrude upon the working environment. Early risers can put in a few hours, getting paperwork up to date and planning for the day, before breakfast or incoming phone calls. Obviously, working/office hours should be set and adhered to, and the workplace should be clearly isolated from the rest of the home.

Home owners have four main possibilities:

• conversion of part of their existing residential accommodation (surface habitable) or non-habitable area such as the attic;
• conversion of an outside building on their plot;
• extending the house;
• or building special premises.

Old bourgeois houses, for example, with lofty ceilings and large windows are ideal for easy conversion to spacious through rooms – the French ‘loff – suitable for artists studios, drawing offices or open-plan offices, perhaps with a mezzanine area. An attic conversion requires a ceiling height of at least 1.80 m and the floor and property foundations must be checked to ensure that they are adequate to support continual use. All conversion projects to an area of over 170 m2, and extension projects of over 20 m2 floor area producing a total new floor area of over 170 m2, must be accompanied by an architect’s plans when application for planning permission is made. Note that planning permission is necessary for any conversion that changes the use of a building or part of a building, so even a conversion of a single garage – one-car garages average 15m2 - requires application for a permis de construire.

Any new building plan proposing more than 20 m2 floor area requires planning permission which will of course be subject to any remaining planning permission density for the plot. New garden sheds of any description, provided they’re over 20 m2, are included.

A permis de construire is valid for two years: enough time to change your mind if the whole project needs rethinking. It can also be extended if you give notice two months before the initial two-year deadline is reached. Work has to have been physically started within the valid period and announced by an outside notice-board – all extra publicity – giving the property owner’s name, size of new floor areas, any new roof heights and stating what work is being carried out.

One third of your household’s utility bills are taken by tax authorities as tax-deductible business expenses, unless an extension or conversion for the business can be shown to occupy more than one third of the overall floor space. Don’t forget, if you are installing a separate business phone line, to get the preferential professionnel rental rate from France Télécom and to compare the cost of their phone calls and Internet connection packages which correspond to your call and connection needs against those offered by other operators such as Cégétél and Télé2.

A property owner’s main residence and a property rented by tenants as their main residence can be used as their business premises provided they do not receive customers or use the property to receive and warehouse goods. Landlords of rented properties should be notified in writing by recorded delivery of this intention. Even if the lease is exclusively residential (bail a usage exclusif d‘habitation) it can be used for business provided this is notified.

By contrast a bail mixte – for professional and residential use -which runs for three years like a residential lease if the tenant is an individual (personne physique), and six years for companies, does not require the property to be the main residence. Non-trading professions such as doctors and lawyers use it to locate their practices in residential buildings.

The August 2003 Loi Dutreuil economic initiative law simplified new business regulations and conditions. SARL limited companies can now use the home address of their managing director, in rented or owned property, as their head office address. Even if the residential lease or private estate regulations normally forbid this, a maximum period of five years is now allowed. This will give sufficient time for most new companies establishing themselves.

BUSINESS CENTRES (CENTRES D’AFFAIRES)

These offer a wide range of office services, all of which can be used quite independently of each other, including domiciliation address, furnished and heated offices on short-term leases, secretarial and photocopying services, and rooms for meetings. They can also provide information and contacts to assist with legal and financial formalities when setting up the business, undertake mailing operations to selected addresses as part of an initial marketing plan, and offer translation services.

Businesses that need to test their market before investing in office equipment, secretaries and longer term commitments to premises have the possibility of using modern well-equipped offices in prime localities and often with private parking spaces. Also, those whose funds are slender in the initial months of the business will not have to have office furnishings, fittings and equipment to equal at least the value of monthly rent as stipulated in standard business premises’ leases. They are also the solution for small companies that just need a first-class address for their registered office. A business centre that is a member of the national federation, Syndicat national des centres d‘affaires et de domiciliation (SNCAED), 22, rue de la Pépiniére, 75008 Paris (www.sncaed.com) is recommended as the SNCAED publish a guide setting out minimum service standards required from their members.

Here is an example of basic services that can be provided, and points that should be checked, with an indication of monthly prices exclusive of VAT (HT) :

• Domiciliation (having the address): up to 90€.
• Permanence téléphonique (switchboard service). Sliding-scale linked to number of calls bands: from approximately 60€.
• Direct line: approximately 30€.
• Plus the cost of outgoing calls made. How promptly can the switchboard reply? Is there an English-speaking person to handle calls from English-speaking customers? Are the offices open throughout the day without any lunchtime closing and possibly on Saturday mornings
• Routage (mailing on letters): up to 20 per cent on the re-postage stamp cost.
• Is mail reposted the same day, and in adequate envelopes?

Bureaux équipés (fitted and furnished offices)

• Prices vary for renting a furnished, heated office for three months to 12 months (with quarterly option to cancel), but around 600€ a month would not be unreasonable. Look for around 15 m2 for one person who receives visitors. Computers will not usually be supplied. Expect to be asked for a dépôt degamntie for up to three months’ rent.

Secrétariat

• Hourly labour rate: approximately 30€.
• Extremely useful for producing reports and business letters in correct French from notes and dictation.
• Letters (per page in black type): approximately 5€.
• Tabular presentation (per page in black type): 9 to 15€.
• Colour tabular presentations and English text typing cost more. Urgent jobs, which have not been pre-booked will also cost more.
• Photocopying costs about 0.10€ a copy which is about the same price as in a Post Office where quality can be inferior.
• Internet with permanent broadband (ADSL) access: approximately 25€.
• Salle de réunion (meeting rooms) seating 20 people: per day, approximately 80€ and per half-day, approximately 55€.

A good business centre should have a choice of different-sized meeting rooms, with one available for last-minute bookings. Audio-visual equipment, at additional cost, should also be available on request.

Smaller office rooms suitable for receiving customers or clients for individual interviews or meetings should also be available on an hourly or daily basis, at a correspondingly reduced price.

Most centres d’affaires will have a small refectory area with vending machines which can be ideal for getting to know the other tenants.

LES PEPINIERES D’ENTREPRISES

These premises have a vocational raison d’être rather than a business one as they are run or have been created by professional federations or local authorities for the sole purpose of helping new businesses to develop.

While they offer services comparable to those of centres d’affaires, premises are rented for up to 24 months at extremely favourable prices, and usually with the possibility of a further 12–month period, taking new businesses through the critical first three years. Assistance and advice is given throughout this period. It is claimed that businesses which emerge from pépiniéres have a much greater chance of long-term success than others.

ZFU, ZRU AND ZUS DEVELOPMENT AREAS

While these areas can offer new businesses attractive tax or social security contribution exemptions, they should not necessarily be considered as good sites. They are by definition in depressed areas, which will not help businesses that require an established booming local economy to help them grow. Furthermore, the criteria demanded to obtain these advantages varies, with the emphasis on the creation of new salaried employment, so qualification is by no means automatic for small businesses. (The exemptions can be granted to new businesses, and established businesses employing up to 50 people, such as factories moving into the area.) Small-business activities that do not require a prestigious lieu d’exercice d’activite, or a healthy local market, for example those relying on correspondence and Internet orders and who take on staff have nothing to lose by applying. A better address for domiciliation, in this instance for incoming post, can always be set up in a centre d’affaires.

Zones tranches urbaines (ZFU)

Visit the website www.wille.gouv.fr to see where they are based. Most are in the Northern part of France. Tax exemption for five years on profits, taxe professionnelle (local business tax) and taxe fonciere (land tax) can apply, as can employers’ exemptions for five years, to social security contributions based on up to 1.5 times the national minimum salary if there is at least one full-time employee.

Zones de redynamisation urbaine (ZRU) and Zones urbaines sensibles (ZUS)

A ZRU is an urban area with a particularly high unemployment rate – the national unemployment rate is around 10 per cent – and a ZUS is an urban area with old neglected houses. ZRUs, of which there are now over 400, will no doubt replace the ZFU system. There are over 700 ZUS areas throughout France. For a list of ZUS locations enter ‘zus’ in the search panel of your Internet search engine and click on the website www.i.ville.gouv.fr/divbib/doc/chercherZUS.htm.

In both development categories employers’ contributions to social security contributions, based on up to 1.5 times the minimum salary, are exempt for 12 months provided there is at least one full-time employee.

BUSINESS LOCATION CHECKLIST

France is a vast country with three coasts, mountainous areas and great tracts of sparsely populated countryside. If residence and a business are being set up at the same time don’t overlook the following.

• Is the location well placed for easy access to major economic areas and towns?
• Are motorways within easy reach, and airports/cargo seaports if export is going to be part of the business?
• With future expansion and taking on staff in mind, is there a good pool of qualified staff available from local universities and training centres? Students in France tend to come from the areas in which they were brought up so they will also have first-hand local knowledge.
• Is the area one with a lot of new businesses starting up and specialist advice available?
• Is the area near one of the new poles of competitiveness and excellence (for research and development companies) approved and financially aided by the government? These areas promise a dynamic economic future. They are spread throughout France. Visit www.competitivite.gouv.fr for precise locations. Interestingly, the Limousin region which is increasingly popular with British buyers of residential property, on account, perhaps, of its mainly rural landscape, only has one.
• Is there a good supply of immediately available premises and business parks?
• Are hospitals and clinics, GPs and specialists, child-care centres and schools for the family available? What about old people’s homes for later on in life?
• What about the natural scenery, beaches, leisure and sporting facilities when you have time off?
• Is there a wide range of historical and cultural sites, cinemas and theatres? Plus any other activities for culture vultures?

You should try to visit areas several times before deciding where to set up home and business. If you decide to move home again later on remember that legal and estate agency fees are about twice those in the UK.

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