Business Start-Ups - Social Security Contributions
26th May 2025
How are social security contributions calculated for a business start-up?
As we have reported previously in these pages, business owners in France pay a substantial amount in social security contributions.
For those who run the business as a micro-entreprise the contributions are a fixed percentage of turnover - from 12.3% to 23.2%, depending on the nature of the activity. In their case, there are no provisional start-up arrangements in place, as the contributions are paid on the basis of declared turnover, each month or quarter. You can read more in our guide below.
For those who run the business using profit and loss accounting - régime réel - the social security contributions are profit based.
In the first year of business, as there is no previous profit record to use to establish the social security contributions payable, a provisional profit figure is used.
The figure is one determined by the social security contributions collection agency URSSAF. This year it is €8,949, a figure which is revised each year, in line with inflation.
Using this figure URSSAF have determined that the amount of social security contributions payable for the year is €3,272. To that figure needs to be added a ‘training’ levy, which varies by profession but averages €138. The figures are for a full year and charged pro-rata.
In total, therefore, the social security contributions amount to between 31-37% of net profits, a figure particularly difficult to digest on a modest profit. The only saving grace is that most of these contributions are income tax deductible, provided of course there is tax to deduct.
The social security contributions comprise those for the main and complementary pensions, death and invalidity, health, family benefits, social charges (CSG/CRDS) and the training levy. By far the largest contribution is for pensions.
The second year of activity continues in the same vein as, until mid-way through the year, after the tax declaration has been submitted and assessed, there remains no profit figure on which to base the contributions.
Once the first year actual figures are known, there is a recalculation of the charges payable, resulting in a refund or a demand for additional contributions, depending on the result.
For the remaining part of the second year, the provisional contributions are based on the results in the first year.
In the third year, the provisional basis of the contributions continues, but now using the previously reported profit/loss figures of the business.
It is possible for an owner, with the consent of URSSAF, to use their own projected profit figures for the first two years of activity.
Whatever the level of profit or loss, a minimal level of contributions is always payable. In 2025 that figure has been set at €1,251, with slight variations by professional activity. Around 80% of that figure is the pension contribution.
Those who are registered unemployed, young persons under 30, and certain others are entitled to claim relief from social security contributions for 12 months. The scheme is called ACRE (Aide aux Créateurs et Repreneurs d’Entreprise). It gives 100% relief from most social security contributions, provided the profit figure is no greater than €35,525. More details at Start-Up Social Security Relief.
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