French VAT rates and VAT compliance

Whilst France follows the EU rules on VAT compliance, it is still free to set its own standard (upper) VAT rate. The only proviso is that it is above 15%. Suppliers of goods or services VAT registered in France must charge the appropriate VAT rate, and collect the tax for onward payment to the French tax authorities through a VAT filling: see French VAT returns briefing.

The current rates are:

Once registered for French VAT, you will have to start following the local rules in a number of aspects. This includes:

• Issuing invoices with the disclosure details outlined in the French VAT Act.
• Electronic invoices with proper signature, authenticity and agreement by the recipient.
• Maintenance of accounts and records, which must be held for at least 10 years.
• Correct invoicing of customers for goods or services in accordance with the French time of supply VAT rules.
• Processing of credit notes and other corrections.
• Use of approved foreign currency rates.

The tax point (time of supply) rules in France determine when the VAT is due. For imports, it is the time of importation. For goods, it is considered as the point of transfer of title. Any VAT due should then be declared in the subsequent VAT return. The tax point for French services is when performed, or on an accruals basis as ‘enjoyed’.

Click for free French VAT info