France Research & Innovation Tax Guide
French R&D and innovation tax incentives. The guide covers: the Crédit d'Impôt Recherche (CIR) — the research tax credit is the most generous R&D incentive in Europe; the CIR rate is 30% of the eligible R&D expenditure up to €100 million (and 5% above €100 million); the CIR is available to all companies subject to the corporate tax (IS) in France, including foreign companies with a French permanent establishment; the eligible expenditure includes: (a) the staff costs of researchers and technicians (the salaries and the employer social charges), (b) the depreciation of R&D equipment (the "amortissement des immobilisations affectées à la recherche"), (c) the outsourced R&D costs (up to €2 million per project per year, or €10 million for projects certified by Bpifrance), (d) the patent costs (the "frais de prise et de maintien des brevets"), (e) the technology watch costs (the "frais de veille technologique" — up to €60,000 per year), (f) the clinical trial costs for the pharma and the life sciences companies, (g) the defence research costs for the defence industry; the CIR is calculated on the increase in R&D expenditure compared to the previous year (the "méthode de l'augmentation") or the volume-based method for the first year; the CIR can be carried forward for 3 years (if the company cannot use the credit against the corporate tax liability) and can be repaid (the "remboursement du CIR") if the company is: (a) a young company (the "jeune entreprise" — less than 8 years), (b) a SME (the "PME" — fewer than 250 employees and turnover under €50 million), (c) a company in a judicial restructuring (the "procédure collective"); the Crédit d'Impôt Innovation (CII) — the innovation tax credit is the complement to the CIR for the innovation activities (the "travaux d'innovation") that do not qualify as R&D; the CII rate is 20% of the eligible expenditure up to €400,000 (the "plafond des dépenses éligibles"); the CII is available to PMEs (SMEs) only; the eligible expenditure includes: (a) the staff costs of the innovation team, (b) the depreciation of the innovation equipment, (c) the outsourced innovation costs (up to €80,000); the CII is subject to the same carry-forward and repayment rules as the CIR; the Jeune Entreprise Innovante (JEI) status — the JEI is a tax and social exemption for young innovative companies; the conditions: (a) the company must be less than 8 years old, (b) the company must spend at least 15% of the eligible costs on R&D (the "dépenses de R&D"), (c) the company must be an SME (fewer than 250 employees and turnover under €50 million), (d) the company must be independent (not controlled by a large group); the JEI benefits include: (a) the exemption from the corporate tax (IS) for the first 3 profitable years (the "exonération d'IS") and a 50% reduction for the next 2 years, (b) the exemption from the social charges (the "cotisations patronales") for the employees engaged in R&D (the "personnel affecté à la R&D"), (c) the exemption from the territorial economic contribution (CET) (the "cotisation foncière des entreprises" and the "cotisation sur la valeur ajoutée des entreprises"), (d) the exemption from the property tax on built property (the "taxe foncière sur les propriétés bâties"); the JEI status is available to the young innovative companies (under 8 years, 15% R&D expenditure) and to the young university companies (JEU) (the "jeune entreprise universitaire" — companies created by researchers or based on university research). All amounts in Euros (EUR). For related reading, see our Corporate Tax Guide → and Company Forms Guide →.
CIR — Eligible Expenditure
- Staff costs: The salaries and the employer social charges for the researchers and the technicians (the "chercheurs" and the "techniciens"). The staff must be directly engaged in the R&D activities. The staff costs are eligible up to the time spent on R&D (the "temps consacré aux travaux de R&D"). The company must maintain a timesheet (the "compte rendu d'activité") for each employee.
- Depreciation: The depreciation of the R&D equipment (the "amortissement des immobilisations") — the buildings, the machinery, the laboratory equipment, the software, and the patents used in the R&D activities. The equipment must be new (first use). The depreciation is eligible for the first 5 years of use.
- Outsourced R&D: The costs of R&D subcontracted to: (a) a French public research organisation (the "organisme de recherche" — CNRS, INSERM, INRIA, universities), (b) a French private research organisation approved by the Ministry of Research (the "organisme de recherche agréé"), (c) a foreign research organisation (subject to the double taxation treaty). The outsourced R&D is capped at €2 million per project per year (or €10 million for the projects certified by Bpifrance).
- Patent costs: The costs of filing, maintaining, and defending patents (the "frais de prise, de maintien et de défense des brevets") — the patent attorney fees, the translation costs, the renewal fees, and the litigation costs.
For the CIR claim procedure (form 2069-A-SD and the technical annex), see our Tax Filing Procedures Guide →. For the CII and the JEI, see the sections below.
JEI — Young Innovative Company
- Tax exemptions: The JEI is exempt from the corporate tax (IS) for the first 3 profitable years (the "exercices bénéficiaires") and benefits from a 50% reduction for the next 2 years. The exemption applies to the profit of the year (the "bénéfice de l'exercice") up to the amount of the R&D expenditure of the year. The JEI is also exempt from the property tax (the "taxe foncière") and the territorial economic contribution (the "CET") for up to 7 years.
- Social exemptions: The JEI is exempt from the employer social charges (the "cotisations patronales") for the R&D employees (the "personnel affecté à la R&D") — the exemption covers the social security contributions (the "cotisations de sécurité sociale") and the family allowances (the "allocations familiales"). The exemption applies up to a limit: (a) 3 times the SMIC (the minimum wage) per employee per year, (b) the total exemption per year is capped at €720,000 (as of the 2026 rules).
For the application for the JEI status (the "agrément JEI") and the annual reporting, see our Starting a Business Guide →.