If you’re a business with your eyes on a new market, particularly in (or near) the EU, you might be looking at the UK and France as options.
France is the second biggest EU economy after Germany, making it an appealing choice. And whilst the EU isn’t officially part of the EU anymore, it certainly has great economic ties with many countries in the region.
If you are thinking about one of these options, it’s probably worth weighing them up side by side. Here, we lay out everything you need to think about in order to make the right choice.
Taxes
Of course, any entrepreneur with their eye on a country abroad is looking at what it means for paying taxes. As the UK operates outside the EU, the tax systems are slightly different.
UK: The UK has a corporate tax rate of 25% for companies with profits over £250,000. Small profits of under £50,000 still pay 19%.
VAT is charged at 20% for companies earning over £90,000 per year.#
When it comes to income tax, personal income is charged at 20% over £12,571, 40% over £50,270 and 45% over £125,140.
France: France also has a corporate tax rate of 25%. However, companies will only pay 15% on taxable profits up to €42,500 as long as their sales are lower than €10 million and 75% of the capital is held by individuals.
VAT is also charged at 20% for most businesses, but has a reduced rate of 10%, 5.5% and a super-reduced rate of 2.1% for medicine, newspapers and cultural events.
For personal income tax, it is charged at 11% between €11,295 to €28,797, 30% between €28,798 to €82,341, 41% between €82,342 to €177,106 and 45% over this.
Visas
UK: Getting a visa to live and work in the UK can be tricky, however there are some schemes available to entrepreneurs looking to boost the economy.
France: France has a slightly easier process as it’s a member of the EU. This means that any person with an EU passport can live and work freely in France, making it an easier place to set up.
It’s worth noting though that even with an EU passport, a person would still have to apply for residency.
Currency
UK: The UK operates in British Pounds, a currency which has remained strong for many years.
Whilst the pound is a good currency to work in, if you trade a lot internationally, you may have to pay high foreign exchange fees.
France: France operates in ruros, which is used in 20 countries, including Austria, Belgium, Croatia, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain.
The good thing about the euro is that it can be used widely. The bad part is that it can be influenced by other large EU economies like Germany – which may be out of a businesses control. This could be particularly problematic if you do a lot of foreign exchange.
Language
UK: The official language of the UK is English, so anyone who can speak it can live, work, network and trade there.
Because English is a widely spoken language globally, it does mean that business in the UK only operates using it, making it difficult to trade in for non-speakers.
France: French is the official language in France, however businesses can operate in English too.
It’s worth noting that French businesses like to operate in their native language, so having a good knowledge of it will help before moving there.
Labour Laws
UK: The UK has relatively strict labour laws, with a minimum wage of £10 per hour for under 20s an £12.21 for 21 and over. The government also has mandatory maternity and paternity leave, as well as sick leave for permanent employees.
France: The current minimum wage in France is €1,801.80 per month as of November 2024, based on a legal working week of 35 hours.
France also has set maternity and paternity leave, as well as sick pay. Any entrepreneur looking to set up a business in France will have to get to know these laws well.
Cost Of Living
UK: Depending on where you live in the UK, life can be expensive. Especially in London, where rent is expensive and so are goods and transport.
According to a variety of sources, the costs can vary between £1,500 – £2,500 per month for a single person – making it expensive!
France: France is a big country, but living in the capital of Paris is also expensive. Different sources have different estimates, but the costs range between €2,000 – €5,000 per month for a single person.
Which Is Better For Business: France Or The UK?
When it comes to these two economies, both are great choices.
The UK has great access to global markets, whereas France has better ties with the EU.
Whilst the choice can be a tough one, neither of them are bad! Just think about what your business needs and the right choice will come to you.
Good luck!