French VAT rates and VAT compliance
French VAT rates
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:
|Rate||Type||Which goods or services|
|20%||Standard||All other taxable goods and services|
|10%||Reduced||Some foodstuffs; certain non-alcoholic beverages; some pharmaceutical products; domestic passenger transport; intra-community and international road (some exceptions) and inland waterways transport; admission to some cultural services ;admission to amusement parks (with cultural aspect); pay/cable TV; some renovation and repairs of private dwellings; some cleaning in private households; some agricultural supplies; hotel accommodation; restaurants (excluding alcoholic beverages); some domestic waste collection; certain domestic care services; firewood; take away food; bars, cafes and nightclubs (except supply of alcoholic beverages); cut flowers and plants for decorative use; writers and composers etc; some social housing; some works of art, collectors items and antiques|
|5.5%||Reduced||Some foodstuffs; some non-alcoholic beverages; school canteens; water supplies, medical equipment for disabled persons; books (excluding those with pornographic or violent content); some e-books; admission to certain cultural events; some social housing; some renovation and repair of private dwellings; admission to sports events; some domestic care services; cut flowers and plants for food production; sanitary protection for women|
|2.1%||Reduced||Some pharmaceutical products; some newspapers and periodicals; public television licence fees; admission to certain cultural events; some livestock intended for use as foodstuff|
|0%||Zero||Intra-community and international transport (excluding road and inland waterways)|
French VAT Compliance
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.
What is the tax point for French VAT?
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’.
Need a fiscal representative in France?
Non-EU businesses selling in France will need to appoint a fiscal representative alongside completing VAT registration and returns.
Fiscal representatives are responsible for the accurate VAT submissions of their non-EU clients.
Avalara offers a Fiscal Representative Service as part of its international VAT and GST Registration and Returns Service.
Need help with your French VAT compliance?
Researching French VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.
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