Self-employed in France can claim state benefits if business fails

Self-employed workers (micro-entrepreneurs) can claim a state benefit called allocation des travailleurs indépendants (ATI) for six months if their business fails, as long as certain conditions are met.

The business must have generated minimum revenue of €10,000 in at least one of two years preceding the claim, and the person applying must have worked with non-salaried status in the same business for at least two years.

Closure of business must be involuntary and definitive, either through a judicial liquidation, judicial administration with the manager replaced by someone else, or because the business is no longer economically viable. 

In the latter case, this must be verified by a competent third party such as an accountant or bank manager.

The person asking for benefits must have registered as a jobseeker with France Travail in the 12 months after the business closed.

Claimants must show they are not receiving unemployment payments from a previous job, full rights pensions, or replacement revenue from another source.

Personal savings and other sources of revenue must be less than €642.52 a month (for a single person). 

The amount received is largely based on your monthly earnings over the two years before the business ended.

In September, it was set at between €19.73 and €26.30 a day (roughly €600 to €800 a month), and it can be paid out for a maximum of 182 days.

The conditions to qualify for ATI are so strict that relatively few people claim it. In 2019, the last time the government issued figures, only 4,400 people did.

Research from state statistics agency Insee shows 4.4 million people in France work outside the salaried job sector, and for 4 million it is more than simply a sideline to a salaried job.

A little known insurance scheme, set up 45 years ago and now administered by an association called GSC, can also help when a business fails.

Those eligible include artisans, shopkeepers and company directors who do not get a salary.

To join, the business must be registered, and the policy holder must not be within five years of claiming full retirement. They should earn at least €20,000 a year from the business (unless they are start-ups) and should not be in financial difficulty when they apply.

Pay-outs depend on declared revenue and the level of monthly premiums. A simulation for a 60-year-old worker with a declared annual income of €22,000, paying €62 monthly premiums, showed they would get a €1,380 monthly payout for nine months.