Selling into France? What businesses need to know about VAT compliance

Selling to French customers and being liable for French value-added tax (VAT) are not the same thing. For U.K. businesses in particular, the gap between the two is significant — and closing it requires understanding how each transaction works, not just where the customer is.

French VAT liability follows the mechanics of a transaction: where goods are when the sale takes place, who arranges transport, who acts as importer of record, whether a marketplace is involved, and what your customer's VAT status is.

• French VAT liability follows the transaction mechanics — inventory location, transport, importer of record, and customer type — not customer location alone, and not whether you have a French office.
• There is no universal French registration threshold for foreign sellers. The €10,000 rule is an EU-wide threshold for qualifying intra-EU B2C supplies, aggregated across destinations — it does not apply to U.K. sellers, and it offers no protection for French inventory or domestic sales.
• OSS and IOSS simplify reporting. They do not erase registration obligations created by French stock, imports, or domestic activity — and marketplace VAT collection covers only deemed-supplier transactions, not the seller's remaining footprint.
• Run the five-step decision framework per transaction flow, register before taxable activity begins, and configure systems before the first sale. A VAT number that isn't wired into checkout, invoicing, and returns is a liability, not a compliance asset.

Where your customer is based is only one variable. What determines whether you have a French VAT obligation is a combination of factors: where the goods are when the transaction begins, which party arranges transport into France, whether goods are stored in France before sale, who appears as importer of record, whether a marketplace controls the payment or delivery terms, and whether the customer is VAT-registered or a private consumer.

Each of those facts can change the answer independently. A sale dispatched from a U.K. warehouse to a French VAT-registered business lands in a different place than a sale made from stock already held in France to the same customer. Having no office in France settles none of these questions.

The following should be confirmed for each transaction flow:

• Country of establishment
• Customer type: business to business (B2B) or business to consumer (B2C)
• Where inventory is held and where fulfilment happens
• The sales channel — direct, marketplace, distributor, or mixed
• Incoterms and importer-of-record arrangements.

The answers for your direct-to-consumer website may differ from your marketplace listings or your wholesale distribution channel.

Holding a French VAT number and charging French VAT on sales are not the same obligation. The reverse-charge mechanism shifts VAT accounting to the business customer in certain B2B transactions — meaning a French VAT number may be required for reporting purposes even where no French VAT is collected on individual sales.

Similarly, certain transactions are handled through IOSS rather than a French domestic return. The question is never simply "do we charge French VAT?" It's "what does each transaction flow require, and what mechanism covers it?"

The answer isn't always obvious. Physical goods moving into or within France, electronically supplied services, consulting and other general B2B services, and categories such as events, property-related supplies, and installation contracts all follow different place-of-supply rules.

Reverse-charge treatment requires a valid French or EU VAT number and evidence that the customer is acting as a taxable business. The VIES VAT number validation tool lets you confirm whether a customer's VAT number is active before applying B2B treatment.

Without that confirmation, the default is consumer treatment — which produces a different VAT liability. Exempt entities and businesses that can't provide a usable VAT number also fall outside the reverse charge. The classification needs to be supported by evidence, not assumed from the customer's name or sector.

Goods dispatched from your home country, goods stored in a French warehouse, stock held in pan-European fulfilment networks, goods imported directly from outside the EU, and goods moved into France as your own stock transfer all carry different VAT consequences. Drop-shipping and multiparty supply chains need to be mapped transaction by transaction. Consignment and call-off stock arrangements require separate review — the VAT treatment of the initial movement differs from the treatment of the eventual sale.

OSS and IOSS handle specific transaction types — they are not blanket simplifications for all French VAT obligations. U.K. businesses are non-EU sellers and cannot access Union OSS, which is available only to EU-established businesses. The schemes available to U.K. sellers are Non-Union OSS for qualifying B2C services, and IOSS for qualifying imported B2C consignments not exceeding €150. For most other French VAT obligations, U.K. sellers will need a French VAT registration.

Where a marketplace controls ordering, payment authorisation, or delivery conditions, it may be treated as the deemed supplier — accounting for and remitting VAT on the covered sale in place of the seller. That changes the seller's position on those transactions, but it does not eliminate all registration obligations. French stock, imports, returns, and off-platform sales preserve seller obligations regardless of marketplace VAT collection. Marketplace transaction-level reports are the primary evidence base for understanding which sales are covered and which are not.

"Likely" in the table indicates a typical outcome rather than a transaction-specific legal determination. Mixed sales models — where more than one row applies — need to be assessed flow by flow.

When a U.K. business ships goods to a French VAT-registered customer, the supply is an export from the U.K. and an import into France. It's not an intra-Community supply — that framework applies only to EU member states. Import VAT and customs duties arise at the French border, and the importer-of-record determination drives both the customs liability and the subsequent VAT treatment. Where the French customer acts as importer of record, they typically account for import VAT themselves. Where the U.K. seller acts as importer of record, a French VAT registration is likely required.

If goods are already in France when the sale takes place — held in a French warehouse, a third-party logistics facility, or a fulfilment network — the transaction is a domestic French supply. French VAT applies regardless of your customer's VAT status, unless a specific domestic reverse-charge provision covers the transaction type. A French VAT registration is required, along with CA3 filing obligations — the monthly electronic VAT return submitted to the French tax authority.

For most general B2B services, the place of supply is where the customer is established — France — and the reverse charge applies. Your French VAT-registered customer accounts for VAT in their own return. Several service categories fall outside this general rule: property-related services, event admission, installation contracts, and services physically performed in France all have specific place-of-supply rules that need to be checked per contract.

Not automatically — but it depends on the facts of each transaction. A service supplied to a French VAT-registered business under the general reverse-charge rule often creates no French registration requirement on its own. A sale from goods already held in French stock to the same customer usually does. Inventory location, importer-of-record status, and the specific service category are the variables that drive the answer.

U.K. businesses are non-EU sellers and do not make intra-Community distance sales. A U.K. business dispatching goods from the U.K. to a French consumer is making an export followed by an import into France. The intra-Community distance-selling rules and the €10,000 EU-wide threshold do not apply.

There is no registration threshold covering non-EU sellers in France. U.K. businesses dispatching goods to French consumers from the U.K. have no threshold below which French VAT obligations disappear — the import creates an immediate VAT question regardless of order value.

Union OSS is not available to U.K. businesses. It is an EU simplification for EU-established sellers. U.K. sellers with qualifying B2C service supplies to EU consumers can access Non-Union OSS, but that covers services only — not goods.

For U.K. businesses, French VAT registration is the default position for most transaction types involving goods in France. IOSS covers qualifying imported B2C consignments not exceeding €150. Everything else — domestic stock, imports above €150, B2B supplies, off-platform sales — requires a French registration and a CA3 return.

For U.K. businesses, this is rarely a choice. IOSS is available for qualifying low-value imported consignments. Non-Union OSS is available for qualifying B2C services. For goods sold from French stock, imports above €150, or any B2B activity, French VAT registration is required. The question for most U.K. sellers is not whether to register — it’s when, and for which transaction flows.

For B2C consignments imported from outside the EU with a value not exceeding €150, IOSS allows VAT to be collected at the point of sale and remitted through a single monthly return. The customer pays VAT at checkout rather than at the border, removing the risk of unexpected charges on delivery and speeding up customs clearance.

IOSS eligibility depends on intrinsic consignment value, not selling price. Excise goods are excluded. Where the mechanism is used correctly, the customs declaration is simplified and the VAT obligation is discharged through the IOSS return.

The duty side of the same transaction is a separate question. The removal of the €150 customs duty exemption affects the same consignment values from a duties perspective — but that is a customs obligation, not a VAT one, and the two need to be tracked independently.

Consignments above €150 fall outside IOSS entirely. Import VAT and applicable customs duties are assessed at the French border under standard import procedures. Where the U.K. seller acts as importer of record and sells from French stock, the transaction splits into an importation and a domestic supply — both create VAT obligations and a French VAT registration is required. Delivered Duty Paid Incoterms shift the import burden to the seller. Delivered at Place shifts it to the buyer but changes the customer’s landed cost and experience. The commercial and VAT decisions need to be made together.

U.K. businesses carrying out taxable activities in France without a French establishment are generally required to appoint a French fiscal representative. The representative acts on the business’s behalf for registration, filing, payment, and correspondence with the French tax authority, and takes on joint and several liability for the VAT obligations of the foreign business.

U.K. businesses may be running more than one mechanism simultaneously. Non-Union OSS covers qualifying B2C supplies of services to EU consumers — not goods. IOSS covers qualifying imported B2C consignments not exceeding €150. French VAT registration covers everything else — domestic stock, imports above €150, B2B activity, and off-platform sales.

The mechanisms are not interchangeable and they are not mutually exclusive. Each return covers a distinct set of transactions, and they need to be reconciled against each other to avoid gaps and overlaps.

Where a marketplace facilitates certain sales through an electronic interface, EU VAT rules may treat it as the deemed supplier — meaning the marketplace accounts for VAT on the consumer-facing sale rather than the underlying seller. For U.K. sellers, this applies to imported B2C consignments not exceeding €150 and certain B2C sales of goods already in the EU. For the underlying seller, deemed-supplier transactions are outside scope for VAT purposes — but require documentation showing those supplies have been accounted for elsewhere.

Deemed-supplier coverage is limited to defined transaction types. It does not cover seller-owned inventory moved into France, imports in the seller’s name, direct-site sales, B2B transactions, or returns and stock transfers. Each preserves a potential registration obligation regardless of how much VAT the marketplace collects on other sales.

For U.K. sellers using Amazon FBA or similar pan-European fulfilment networks, stock movements create VAT registration triggers before the first local sale. Goods leaving the U.K. enter the EU as imports, generating import VAT obligations at entry. Subsequent transfers into French fulfilment centres are taxable events in their own right. Inventory-location reports from the platform — not settlement reports, which reflect revenue rather than stock movements — are the primary control for tracking where obligations arise.

U.K. businesses registering for French VAT deal with the Service des impôts des entreprises étrangères — the dedicated tax office for foreign companies. Registration should happen before taxable activity begins, and applications must be submitted in French with certified supporting documentation. A French VAT number takes the format FR + a two-character validation key + a nine-digit SIREN number — separate from an EORI number, which covers customs registration.

Obtaining the number is step one. It needs to be wired into checkout, invoicing, and returns before the first sale — a VAT number that isn’t configured in your systems produces incorrect rates, missing reverse-charge wording, and filing errors that compound over time.

The standard French VAT return is the CA3 — a monthly declaration covering output VAT, deductible input VAT, acquisitions, and imports, filed and paid electronically. Import VAT is subject to mandatory automatic reverse charge for VAT-identified businesses in France, meaning VAT due at import is declared and simultaneously deducted in the CA3 return rather than paid at the border.

For U.K. businesses selling into France, the compliance burden compounds quickly. Registration triggers get missed because inventory-movement data sits outside the tax team’s visibility. IOSS and domestic CA3 returns run as separate workflows with no shared controls. Marketplace settlement data and ERP data don’t reconcile. And corrections get made in the return but not in the ledger.

Avalara’s AI-powered solution for VAT registration continuously monitors your transaction data against current French VAT rules — flagging registration triggers, rate mismatches, and classification changes in real time rather than at month-end.

Where your business operates across multiple sales channels, Avalara consolidates the data into a single compliance workflow so IOSS transactions, domestic supplies, and import VAT all flow into the correct return without manual reconciliation. For U.K. businesses expanding into additional EU markets alongside France, the same architecture applies across regions — one connection to your ERP, consistent controls, and a reusable compliance model that doesn’t need rebuilding for each new country. Speak with Avalara today to learn more.

Generally yes. U.K. businesses carrying out taxable activities in France without a French establishment are required to appoint a fiscal representative — a French-based intermediary who acts on their behalf for registration, filing, and payment, and who takes on joint and several liability for their VAT obligations.

Not if you’re a U.K. business selling goods. Union OSS is available only to EU-established sellers — U.K. businesses cannot access it. IOSS covers qualifying imported B2C consignments not exceeding €150, and Non-Union OSS covers qualifying B2C services. For goods sold from French stock, imports above €150, or any B2B activity, French VAT registration is required regardless.

Yes, typically before the first customer sale takes place. Goods entering an EU fulfilment centre from the UK are imports — generating import VAT obligations at entry. Subsequent stock transfers into French fulfilment centres are taxable events in their own right. Inventory-location reports from the platform, not settlement reports, are the primary control for tracking where those obligations arise.

It depends on the transaction. Where your customer is VAT-registered and the reverse charge applies, they account for VAT in their own return and you may not need a French registration for that transaction alone. But inventory location, importer-of-record status, and the specific transaction type can all override that position. The reverse charge is not available where your customer is a private consumer, an exempt entity, or cannot provide a valid VAT number.