Contents
- 1 Is France the champion of fiscal and social pressure?
- 2 The administrative obstacle course: when red tape kills innovation
- 3 A business climate that puts the brakes on ambitions
- 4 Is the grass really greener elsewhere? Comparison of top destinations
- 5 Beyond business: preparing for life abroad
- 6 So, should you pack your bags? Weigh up the pros and cons ⚖️
- 7 FAQ
Key points to remember: France has a €157 billion tax gap compared with the eurozone. Heavy taxation (corporation tax, dividends, social security contributions) discourages entrepreneurs, putting the brakes on employment and innovation. The result: a flight of talent to destinations such as Ireland (12.5% corporation tax) or Portugal (RNH), where conditions are more favourable for business start-ups.
Tired of seeing your profits evaporate under the weight of taxes and formalities? In France, corporation tax, double taxation of dividends and record social security charges are driving many entrepreneurs to leave the country. Cases such as that of Jean Dupont, founder of TechStart, illustrate this departure for destinations such as Ireland (12.5% corporation tax) or Portugal (RNH status). Our article reveals 50 concrete reasons, combining attractive taxation, administrative simplicity and an ideal living environment. Find out how some countries are turning expatriation into a business opportunity, without sacrificing your personal balance.
- France, the champion of fiscal and social pressure?
- The administrative obstacle course: when red tape kills innovation
- A business climate that puts the brakes on ambition
- Is the grass really greener elsewhere? Comparison of top destinations
- Beyond business: preparing for life abroad
- So, should you pack your bags? Weighing up the pros and cons ⚖️
The exodus of French entrepreneurs is a cause for concern. There are several reasons why entrepreneurs are looking elsewhere. Let’s take a closer look at one key factor: high taxes and social security contributions.
In 2019, French businesses will pay €125 billion more in taxes than their European competitors. A colossal gap that is growing year on year.
Corporation tax and dividends: when success is taxed
The standard rate of corporation tax in France is 25%. SMEs benefit from a reduced rate of 15% on the first €381,200 of profits.
Compared with the rest of Europe, France is above average. In Spain, corporation tax is 25%, with a reduced rate of 15% for the first €1 million. In the Netherlands, the standard rate is 19% on the first €200,000. In Germany, corporation tax remains at 15%, with an additional 5.5% levy for solidarity.
Imagine an entrepreneur with €100 profit. After corporation tax at 25%, that leaves €75. The dividends are then subject to a flat-rate withholding tax of 30% (12.8% tax, 17.2% social security contributions). That leaves just €52.5.
France’s tax burden is €157 billion lower than the eurozone average, a burden borne mainly by businesses.
Social charges that weigh on employment and profitability
With employers’ social security contributions averaging 45% of gross pay, the total cost of employing a worker is skyrocketing. For a net salary of €2,000, the employer spends around €2,700. In Spain, this ratio falls to 40% of gross salary.
In 2024, Spain ranked 6th in the euro zone for hourly labour costs. At €44 an hour, compared with an average of €38 in the eurozone.
These figures are holding back recruitment. Take-home pay is becoming less competitive with foreign offers.
Experts point out that this situation could drive entrepreneurs out of the country. A tax system deemed punitive is pushing more and more company directors to relocate.
Wealth and inheritance tax: a headache for the future
The IFI (Impôt sur la Fortune Immobilière) is adding to the constraints. Entrepreneurs are reluctant to invest in business property with this sword of Damocles hanging over their heads. ⚖️
Passing on a business can often be an obstacle course. Inheritance tax is as high as 45% for direct descendants. The Dutreil agreement offers a 75% allowance, but there is still room for improvement.
As a result, some people prefer to sell to foreign groups rather than pass on their business. A trend that is draining the French economic fabric of its substance.
The administrative obstacle course: when red tape kills innovation
Complex, time-consuming procedures for setting up and running a business
Setting up a company in France sometimes means spending more time filling in forms than developing your business.
Between obtaining a SIRET number (8 to 15 days after registration), notifying Social Security for the self-employed (4 to 6 weeks) and the countless formalities, entrepreneurs often have to turn to chartered accountants.
In the Île-de-France region, the administrative side of business becomes an obstacle course, with five layers of red tape to deal with. ️
Even for a micro-business, the process takes several weeks. And if the application is incomplete, the time taken is even longer.
In 2025, France is still stuck in an administrative ecosystem inherited from the 20th century.
For a traditional company (SAS, SARL), allow between 2 and 4 weeks, compared with 3 days in some European countries. The one-stop shop for business formalities, operational since 2024, is struggling to simplify the process.
Rigid labour laws that hamper agility
French labour law is often a hindrance to small businesses looking for flexibility.
- Adapting an employment contract to a changing market? Few entrepreneurs can do it alone.
- Dismissing an employee is expensive, even on economic grounds.
- The risk of industrial action discourages many companies from taking on permanent staff, creating a vicious circle for the creation of stable jobs. ️
- Personnel administration takes up precious time that start-ups don’t need to waste.
For a start-up, these constraints weigh heavily in the balance when a Portuguese or Spanish competitor offers a more flexible framework.
Redundancy costs in France are also a major obstacle.
Between the statutory indemnity (1/4 month’s salary per year of seniority), the indemnity in lieu of notice and the risks of litigation, even an economic redundancy turns into a financial dead end.
Unstable rules: a lack of visibility for investment
Regular changes in regulations are undermining the confidence of French entrepreneurs.
The innovation tax credit (CII) will disappear on 31 December 2024, unless it is renewed at a reduced rate.
Even health insurance for the self-employed is changing, with the obligation to be covered by social security from 2025, with no systematic compensation.
How can you plan for the future when the rules change every year?
The 2025 reforms add yet more uncertainty.
The end of the ZFU-TE, the reduction in the exemption for public transport (from 75% to 50%), the disappearance of the CII… These measures, even if only partially compensated for, are forcing managers to look elsewhere.
Why set up in France when Spain offers a preferential tax regime for start-ups and Portugal makes it easier to obtain non-habitual resident status? ️
A business climate that puts the brakes on ambitions
In France, many entrepreneurs feel that their development is being held back despite the official rhetoric. A study reveals that 45% of SME managers feel isolated in the face of daily challenges.
While they recognise existing support schemes such as French Tech, many point to a gap between promises and administrative reality.
A perceived lack of support for start-ups and SMEs
Business start-ups benefit from schemes such as the BPI, but intermediate growth remains complex.
Entrepreneurs who do not fit the “unicorn” profile have difficulty obtaining bank finance. Their projects, although viable, are often classified as “risky” without sufficient guarantees.
There isa widening gap between pro-entrepreneurship political rhetoric and the realities experienced in prefectures or formalities centres. ️
To understand what motivates an entrepreneur, we need to consider the need for a more supportive ecosystem.
A culture with little tolerance for failure
Unlike the Anglo-Saxon mindset, entrepreneurial failure in France remains stigmatised. ❌
A manager in receivership takes an average of 2.5 years before being able to relaunch a business, with serious personal consequences. ️
According to a recent survey, this situation discourages 66% of French people from starting a business, a percentage that rises to 72% among young people.
This “zero-defects” culture penalises innovation and the emergence of new projects based on past experience.
The consequences of the “talent drain
The departure of skilled entrepreneurs represents a deadweight loss for the French economy.
Initiatives such as APESA are trying to support managers in difficulty, but the system still lacks comprehensive support to help them bounce back.
The 5-year survival rate remains lower for traditional businesses (61%) than for SCOPs (76%), illustrating the value of collective models.
More and more entrepreneurs are leaving France, attracted by more favourable tax regimes and simplified procedures.
The case of Informa’truck, which went into liquidation in 2024 despite a television appearance, and Pyxo, which is in receivership, show the limits of the current system. These cases could have been handled differently with more appropriate support. ️
This ‘brain drain’ affects growth, innovation and tax revenues in the long term. ⚖️
Is the grass really greener elsewhere? Comparison of top destinations
Many French entrepreneurs choose to leave France, attracted by more favourable environments for their development.
Ireland, Portugal and Spain are emerging as strategic destinations for companies seeking growth.
Let’s take a look at the advantages of these countries in attracting French talent and capital.
Ireland: a tax and technology Eldorado
Ireland’s 12.5% corporation tax rate is a magnet for international companies.
The country offers an ideal setting for start-ups and groups expanding across Europe. ️
- Dublin is home to the European offices of giants such as Google, Amazon and Facebook
- More than 37,000 people work in the technology sector
- More than 4,500 startups operate in the area, with €7 billion raised in 5 years
It takes 8 to 10 days to set up a company, with a simplified, digital process.
French-speaking support makes setting up easy: setting up a company in Ireland is simplified, from paperwork to bank accounts.
Dublin also stands out for its investment in R&D and its more than 300 innovation hubs.
The Medtech ecosystem is particularly attractive, with 14 of the 15 largest companies in the sector based here.
Portugal and Spain: quality of life and low taxes ☀️
These two destinations combine an exceptional quality of life with favourable tax regimes for expatriates.
Portugal, although Non-Habitual Resident (NHR) status has not been available to new arrivals since 2024, remains attractive.
High value-added sectors can still benefit from flat-rate tax rates of 20% on certain professional income.
In Spain, the “Beckham Law” attracts expatriates with a reduced rate of 24% on professional income up to €600,000.
- Valencia, ranked the best city in the world in which to live in 2024
- Málaga and Alicante in the world’s top 25 expatriate cities
- Golden Visa programme in Portugal for property investments
Living costs are generally more affordable than in France, particularly outside the major cities.
Barcelona and Madrid, although more expensive, are still competitive with the French centres.
Comparative table of destinations
| Criteria | France | Ireland | Portugal | Spain |
|---|---|---|---|---|
| Standard rate of corporation tax | 25% (31% for profits > €500,000) | 12.5% (0% for intellectual production) | 21% | 25% (15% for profits < €300,000) |
| Average rate of employers’ social security contributions | Around 25-30 | Approximately 10-16 | Around 23-28 | Approximately 23-28 |
| Administrative simplicity | Complex | Simple | Moderate | Moderate |
| Specific tax benefits | None | Low rate of corporation tax (12.5%) | RNH status (until 2024) | Beckham Law (special expatriate regime) |
| Quality of life index | Good | Good | Very High | Very high |
Ireland generates €35 billion in annual digital exports.
In these destinations, French entrepreneurs find a good balance between tax, lifestyle and business opportunities.
The choice depends on your sector, your business model and your international objectives.
Beyond business: preparing for life abroad
Leaving France to set up your business also means upsetting your personal balance. This decision has an impact on the whole family. An OFII survey shows that 41% of expatriation failures are the result of poor anticipation of these aspects. Preparing your private life is just as strategic as your business plan.
The key stages in a successful expatriation
A successful expatriation project is one that has been anticipated. Take the time to analyse the legal, tax, personal and family aspects before taking the plunge.
- Validation of the professional project: Mathilde Dubois chose the Netherlands after 6 months’ study of the Dutch market, noting a more supportive ecosystem for scale-ups. Her €95/month expatriate health insurance provides security for her family and team.
- Administrative procedures: For her family, she obtained an entrepreneur’s visa for the Netherlands in 8 weeks thanks to the Dutch embassy in Paris.
- Accommodation and schooling: She booked accommodation in Amsterdam 3 months before her departure and enrolled her children in a bilingual French-Dutch school, avoiding rejections due to waiting lists.
- Social protection: She took out health insurance to cover her team and family, while retaining French pension rights under the EU agreement.
Integrating into a new environment: the cultural challenge
The language barrier can be costly. ️ A French boss in Madrid lost a Spanish investor after miscommunication. According to INSEE, 38% of expatriates give up within the first 2 years because of this barrier.
To avoid this pitfall:
- Learn the basics of the language before you leave. The Babbel app helps 72% of users to hold a basic conversation after 3 months.
- Join expat networks via Meetup or Facebook like Francophones Étrangers with 150,000 members.
- Take part in local activities. A Spanish entrepreneur won 3 contracts by joining a sailing club in Marseille.
Culture shock hits even in Europe. An OFII study shows that 65% of expatriates in Germany underestimate professional codes (punctuality, hierarchy). Camille Leclerc, a start-up entrepreneur in Lisbon, has increased her contacts by accepting the “almoços tardios” (late lunches) typical of Portugal. Her secret: adapting her routine without sacrificing her identity.
So, should you pack your bags? Weigh up the pros and cons ⚖️
French entrepreneurs face a number of challenges: high taxation (25% corporation tax, social security contributions), labour costs (charges of up to 45%) and cumbersome formalities. It takes an average of 5 days to set up a business in France, compared with 18 minutes in Estonia. Some leave for the Netherlands (flat tax) or Portugal (NHR regime). Yet France remains attractive, with a market of 70 million consumers, support (CII, French Tech) and modern infrastructure (transport networks, digital).
Leaving is not trivial. A freelancer might opt for Estonia, where procedures are 100% online. A scale-up manager will be reluctant to lose the support of Bpifrance (e.g. Deezer, BlaBlaCar). France’s legal stability is an asset when it comes to international contracts, but the burdens weigh heavily on young companies. For example, a start-up pays an average of 40% in payroll taxes, compared with 20% in Spain. On the other hand, countries like Luxembourg offer targeted support for tech companies (tax credits, exemptions).
There is no single answer. Compare costs and opportunities and consult experts (lawyers, accountants). France relies on innovation, others on flexibility (Portugal, Luxembourg). Explore Bpifrance assistance and foreign tax regimes. What’s important? Tailor your choice to your project Ready to explore the options?
France, with its high taxes and cumbersome procedures, is a major turn-off for entrepreneurs. Ireland, Portugal and Spain offer tax advantages and quality of life. France offers a solid market, infrastructure and innovation. It all depends on your project. Before taking the plunge, compare and inform yourself. The right balance exists – find it! ✨
FAQ
Why do entrepreneurs leave France?
France’s tax burden is €157 billion lower than the eurozone average.
This imbalance is due to double taxation on success: corporation tax (IS) and then tax on dividends. For every €100 of profit, entrepreneurs see a large part of their earnings disappear.
Where do French people who leave France go?
Ireland attracts many entrepreneurs thanks to its 12.5% corporation tax rate.
Portugal and Spain are also popular for their quality of life and advantageous tax regimes (Non-Habitual Resident status in Portugal and the Beckham Law in Spain). ☀️
Why do people leave France?
France’s administrative complexity discourages entrepreneurs. There are so many acronyms to juggle with: URSSAF, Greffe, Impôts, and so on.
This administrative obstacle course costs time and money, driving entrepreneurs to look for simpler destinations.
Why should you leave France?
Apart from the tax aspects, the perceived lack of support for start-ups and SMEs weighs heavily in the balance.
Although France offers schemes such as the BPI and French Tech, many entrepreneurs feel that there is a gap between the pro-business political rhetoric and the administrative reality.
Why are so many businesses closing in France?
Rigid labour laws make it difficult to adapt.
Hiring or firing in a changing environment becomes a minefield. This has a direct impact on companies’ ability to adapt quickly to the market.
How many people are leaving France?
There are significant migratory flows among entrepreneurs, but no precise figures are available.
This “brain drain” phenomenon has a significant economic impact, with a loss of potential growth, jobs and innovation.
Which country is most welcoming to the French?
Ireland stands out for its dynamic tech ecosystem in Dublin and its skilled, English-speaking workforce.
It’s easy to set up a company here, which is attracting more and more French entrepreneurs.
Is France worth immigrating to?
The decision depends on your life and career plans.
While France offers a large market and solid infrastructure, it faces administrative and tax challenges that other countries have managed to turn into competitive advantages.
Where to go when you want to leave France?
Several destinations attract French entrepreneurs: Ireland for its attractive corporation tax rate, Portugal for its Non-Habitual Resident status, and Spain for its quality of life.
Each country has its own tax, social and cultural specificities that need to be assessed before taking the plunge.
