JEI calculation 2026: how to estimate your employer contribution exemption

Short answer

A JEI calculation is really two separate calculations, and conflating them is the mistake we correct most often.

1. The calculation that opens the status: your research expenditure must represent at least 20% of your tax-deductible charges for the financial year. The threshold rose from 15% to 20% under the 2025 social security financing act, applicable to years ended on or after 1 March 2025.
2. The calculation of the exempted amount: employer social security and family allowance contributions on the pay of staff assigned to R&D are exempt, subject to 4.5 times the minimum wage in gross monthly pay per person (€8,203.64 until 31 May 2026, €8,401.59 from 1 June 2026) and to €240,300 of exemption per establishment per calendar year in 2026 (five times the annual social security ceiling, which is €48,060 for 2026).

The first calculation decides whether you are entitled to anything. The second tells you how much.

JEI stands for jeune entreprise innovante, France's "young innovative company" status. You assess it yourself; there is no application to file.

Step 1. The 20% ratio: the calculation that governs everything

The formula

        research expenditure for the year (retained by nature)
ratio = ------------------------------------------------------  ≥ 20%
              tax-deductible charges for the same year

Both sides are built under precise rules, and this is where approximations get expensive.

Numerator: expenditure retained "by nature", without the CIR flat rates

The expenditure retained is that listed in points a to g of II of article 244 quater B of the French tax code, the same categories as for the research tax credit: depreciation of assets allocated to research, staff costs of researchers and technicians, outsourced research, and so on.

But doctrine adds a reservation many companies miss: in assessing the 20% threshold for JEI qualification, "only the nature of the expenditure concerned is to be retained, to the exclusion of caps and flat-rate calculations", the latter applying only to determine the CIR base (BOI-BIC-CHAMP-80-20-20-10, § 200).

You cannot, therefore, reuse your CIR base to test the JEI threshold. The CIR base includes a flat rate for operating expenses of 40% of staff costs and 75% of depreciation. Those flat rates inflate the CIR but do not count in the JEI ratio. A company testing its ratio with its CIR base awards itself several percentage points that do not exist.

Two further points:

• research expenditure incurred with another JEI drops out of the ratio, to prevent the same expenditure being counted twice, once at the subcontractor and once at the customer;
• the expenditure retained must correspond to costs deducted from taxable profit.

Denominator: tax-deductible charges, less two adjustments

You take all tax-deductible charges for the year, neutralising:

• foreign exchange losses on transactions in foreign currencies or in digital assets;
• net charges on disposals of marketable securities.

Both are "without effect on a company's JEI qualification": they must not push a company below the threshold because of a financial item unrelated to its research activity.

Directors' remuneration

The remuneration of a director who effectively and personally takes part in research projects enters the numerator, provided it is a charge deductible from taxable profit.

For sole traders and partnerships that have not elected for corporate income tax, the director's remuneration is not a deductible charge. Doctrine then allows a tolerance: a director who personally takes part in the work may add, to both sides of the ratio, an amount equal to the latest known average annual net salary of private-sector managers at the year end, capped at the profit actually allocated to them. The 20% criterion is assessed "flexibly, so as to give the scheme wide scope".

Worked example: year ended 31 December 2026

Ratio = 275,000 / 1,180,000 = 23.3% → the 20% threshold is met.

Run the same figures the CIR way and you get €377,750 (€275,000 + €84,000 of flat-rate operating expenses + €18,750 on depreciation), an apparent ratio of 32.0%. That is the figure not to use. A company whose true ratio is 17% could believe it qualifies at "24% calculated the CIR way", then discover the error at its first URSSAF audit, with a reassessment covering every exemption applied.

Step 2. Calculating the exempted amount

What is exempt, what remains payable

The exemption covers employer social security contributions (sickness, maternity, invalidity, death, old age) and family allowance contributions.

Still payable, among others: occupational accident and disease contributions (AT/MP), CSG and CRDS, employee contributions, the housing fund contribution (FNAL), the social dialogue contribution, the transport levy (versement mobilité), unemployment insurance and AGS, AGIRC-ARRCO supplementary pensions, and the forfait social. JEI status therefore does not halve your employer cost: it removes one specific layer of the payslip, in practice on the order of 25% to 30% of gross depending on your situation.

That is why the calculator offers a default average rate of 26% for the contributions concerned, while stating that this is indicative and not an official rate: the real rate is read off your payslips and depends notably on pay levels.

Who is covered

Employees whose activity is devoted to R&D projects: researchers, technicians, R&D project managers, lawyers responsible for industrial property protection and technology agreements relating to the project, and staff running pre-competitive testing. Company officers are also covered (minority gérant of an SARL, directeur général of an SA, président of an SAS) where they take part in the R&D project as their principal activity.

The two 2026 caps

Beware content still online quoting an annual cap of "about €235,500": that is the calculation using the 2025 ceiling (€47,100). For 2026 the correct figure is €240,300.

Worked example

Case 1: four R&D engineers on €4,500 gross a month

• monthly exempt base: 4 × €4,500 = €18,000 (each is below the 4.5 × minimum wage cap)
• average rate for the contributions concerned: 26%
• monthly exemption: 18,000 × 26% = €4,680
• annual exemption: €56,160, well below the €240,300 cap

Case 2: a CTO on €10,000 gross a month

• base retained: capped at €8,401.59 from 1 June 2026
• monthly exemption: 8,401.59 × 26% = €2,184, instead of €2,600 if full pay were retained
• the gap, roughly €416 a month, is the portion the cap leaves with you

Where the annual cap starts to bite: at roughly €26,200 of annual exemption per employee paid at the monthly cap, the €240,300 limit is reached at around nine R&D employees. Beyond that, an additional hire brings no further contribution saving at that establishment.

Estimate your amount from three fields. The JEI calculator takes the number of employees assigned to R&D, their average gross monthly pay and the number of months concerned, and applies the 2026 caps. It estimates an amount: it does not check your size, your ownership structure or your R&D intensity. The JEI eligibility test is there for that. → Open the JEI calculator

The other conditions, to check before any calculation

The 20% ratio is only one of the five criteria in article 44 sexies-0 A of the tax code. You also need:

• size: fewer than 250 employees, and annual turnover below €50 million or a balance sheet total below €43 million;
• age: under eight years old (under eleven for companies created before 1 January 2023). The status is lost permanently on the eighth anniversary, and the exemption applies until the last day of the seventh calendar year following the year of creation;
• ownership: at least 50% of the capital held continuously by individuals, by other JEIs themselves at least 50% held by individuals, by associations or foundations recognised as being of public utility with a scientific purpose, by public research and teaching establishments or their subsidiaries, or by a closed list of investment structures;
• an activity that is new in substance: companies created through a concentration, a restructuring, an extension of pre-existing activities, or which take over such activities, are excluded. One exception: a company resulting from the restructuring of companies that were themselves JEIs at the time of the transaction can qualify, the age condition then being assessed from the earliest of the creation dates.

These conditions are assessed year by year. A company can therefore be a JEI one year and not the next: a year in which R&D slows while commercial charges rise is enough to push the ratio below 20%.

The condition that stops most group-owned subsidiaries

The ownership test is the one to read carefully if your company belongs to a group. An ordinary corporate parent, French or foreign and however innovative, is not on the list of qualifying holders. A French subsidiary wholly owned by an operating company therefore generally fails the 50% test, whatever its R&D intensity.

Two consequences follow, before you model anything:

• JEI status is, in practice, a scheme for founder-owned and fund-backed companies rather than for subsidiaries of operating groups;
• the CIR has no ownership condition. A group-owned French entity that is out of scope for JEI can still claim the research tax credit on the same staff costs. Estimate the CIR

What changes in 2026

• The status is extended. The 2026 finance act (law no. 2026-103 of 19 February 2026) keeps the contribution exemption open to companies created no later than 31 December 2028, and extends on the same terms the optional exemptions from business property tax (CFE) and property tax, for seven years, where local authorities so decide (art. 40).
• A new category: the JEII. Article 23 creates the jeune entreprise d'innovation à impact, an alternative to the 20% threshold: research expenditure between 5% and 20% of tax-deductible charges, combined with the conditions specific to social and solidarity economy enterprises. An impact-driven company that failed the 20% threshold now has a second route.
• A reminder on tax. The exemption from tax on profits under article 44 sexies A only concerns companies created up to 31 December 2023. A company created in 2024 or later is a JEI for social contributions and local taxes, but not for tax on profits. This is the most frequent misunderstanding about the scheme.
• The other routes in. The jeune entreprise de croissance (JEC) requires research expenditure between 5% and 20% of charges and compliance with economic performance indicators set by decree; the jeune entreprise d'innovation de rupture (JEIR) requires more than 30% research expenditure and gives its investors an enhanced income tax reduction.

Common mistakes

1. Testing the 20% threshold with the CIR base, flat rates included. The most common, and the most dangerous.
2. Forgetting the denominator adjustments: neutralising foreign exchange losses and net charges on disposals of marketable securities can be enough to clear the threshold.
3. Applying the exemption to the whole technical team: only staff assigned to R&D projects are covered. A developer doing maintenance and support is not in the base, or only pro rata to documented R&D time.
4. Thinking in terms of total employer charges, when the exemption covers only social security and family allowance contributions.
5. Ignoring the per-establishment cap: it applies site by site and per calendar year.
6. Claiming JEI status without tracking time: as with the CIR, the split between R&D and non-R&D time is the first document requested in an audit.

Frequently asked questions

Is the JEI threshold calculated the same way as the CIR base? No. The expenditure categories are the same, but for the JEI threshold you retain expenditure by nature, without the caps and flat rates applicable to the CIR: neither the 40% rate on staff costs nor the 75% rate on depreciation.

What is the JEI exemption cap for 2026? Two cumulative caps: 4.5 times the minimum wage in gross monthly pay per person, i.e. €8,203.64 until 31 May 2026 and €8,401.59 from 1 June 2026; and €240,300 of exemption per establishment per calendar year, being five times the annual social security ceiling (€48,060 in 2026).

How long does the exemption last? Until the last day of the seventh calendar year following the year of creation, provided the company meets the conditions at each year end. The status is lost permanently on the eighth anniversary for companies created on or after 1 January 2023.

Can a foreign-owned French subsidiary claim JEI status? Usually not. At least 50% of the capital must be held by individuals or by a closed list of qualifying entities, which does not include an ordinary corporate parent. The CIR, which has no ownership condition, remains available.

Can JEI status and the CIR be combined? Yes, and it is the most common structure: JEI status acts on employer contributions, the CIR on tax. The same staff costs feed both calculations, under different base rules.

Our company was created in 2025. Do we get the exemption from tax on profits? No. That exemption is reserved for companies created up to 31 December 2023. You keep the employer contribution exemption and, where local authorities so decide, the local tax exemptions.

Do you have to apply for JEI status? The status is self-assessed: no prior decision is required to apply it. You can nonetheless secure your qualification through a specific advance ruling, with tacit approval if there is no reply within the set period. On a first financial year, we generally recommend it.

Next steps

→ Estimate your exemption with the JEI calculator → Check first that you are within scope → How JEI status works, in detail

The 20% ratio is calculated on your statutory accounts, not on an estimate. To settle it before your next year end, let's talk.

Sources

• Articles 44 sexies-0 A and 44 sexies A of the French tax code
• BOI-BIC-CHAMP-80-20-20-10, updated 15 April 2026 — JEI / JEU / JEC / JEII conditions, assessment of the 20% threshold
• ACTU-2025-00073 — increase of the research expenditure threshold to 20% (law no. 2025-199 of 28 February 2025 on social security financing, art. 22)
• ACTU-2026-00067 — creation of the jeune entreprise d'innovation à impact and extension of local tax exemptions (law no. 2026-103 of 19 February 2026, art. 23 and 40)
• BOI-IF-CFE-10-30-60-20, updated 15 April 2026 — business property tax exemptions
• URSSAF — JEI and JEU employer contribution exemption: staff covered, contributions exempt, caps
• entreprendre.service-public.gouv.fr, factsheet F31188 — jeune entreprise innovante status
• 2026 annual social security ceiling: €48,060 (order of 22 December 2025)

This article reflects the law as at 8 September 2026. It is not advice on a specific situation. The 2026 social parameters should be confirmed against the BOSS and the URSSAF website before being applied in payroll.