Young Innovative Company (JEI)

Social security exemptions for young R&D SMEs (and tax exemptions for those created before the end of 2023)

The Young Innovative Company (JEI) status is designed for young, independent SMEs with new business activities that carry out a significant volume of R&D. It provides access to social security exemptions, and in some cases, tax exemptions for companies created before the end of 2023.

As it reduces employer social contributions on an ongoing basis, JEI is the first incentive to activate for start-ups — from the very first hire. Unlike most other schemes, it does not require upfront spending to receive benefits later.

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JEI in short

Target audience Target audience

Independent SMEs under 8 years old carrying out substantial R&D

Project type Project type

All Research & Development (R&D) activities

Type of funding Type of funding

Exemptions from employer social contributions, and potentially from taxes and duties.

Categories

Reduced employer contributions to social security (divided by approximately three) for company officers and employees primarily involved in R&D activities.

For JEIs created before 2024: full CIT exemption for the first profitable fiscal year, followed by a 50% exemption for the second year. This second exemption can be applied either the year the status ends or the following year.

Exemptions from property tax, CFE (Business Property Contribution), and CVAE (Value Added Contribution for Businesses), depending on decisions by local authorities.

A 30% income tax reduction for individuals subscribing to JEI equity. Annual contribution limits: 75,000 Euros for individuals and 150,000 Euros for couples, with a maximum tax reduction of 50,000 Euros between January 1, 2024, and December 31, 2028.

There is a strong link between the JEI status and the Research Tax Credit (CIR), as both are based on R&D activities and expenditures. They are fully compatible: the JEI reduces the cost of R&D, while the CIR partially reimburses it afterward. Moreover, a positive JEI ruling following a scientific review significantly strengthens the CIR claim’s credibility.

Eligibility requirements for JEI & JEIC status

In 2024, the corporation tax exemption has been abolished for start-ups created on or after 01/01/2024.

At the same time, however, the JEI (JEI de Croissance) label was created.

JEI JEIC
To be an SME in the European sense of the term yes yes
Less than 8 years old yes yes
Have a majority shareholding of natural persons of SMEs majority owned by natural persons yes yes
Carry out a new activity in the sense of not involving the demerger, takeover, merger or extension of pre-existing activities yes yes
R&D volume of eligible expenditure At least 20% of sales Between 5% and 20% + growth indicators

The growth indicators for JEIC status are based on two criteria:

  • The company’s headcount must have increased by at least 100% and by at least 10 full-time equivalent (FTE) employees compared to the headcount at the end of fiscal year N-3
  • The amount of R&D expenditure for the current fiscal year must not have decreased compared to the previous fiscal year.

How can we help you?

PNO Innovation’s experts can help you put your project together. They will also help you define your project’s strategy and position it in line with market trends and national and European strategic objectives.

Our experts

Am I eligible for JEI status?

Given the strategic importance of this status — which may be declared by the company itself but must be justified in the event of a URSSAF or tax audit — our experts support you with the full preparation of the initial advance ruling request, and then verify your continued eligibility each year.

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