Implementation of French VAT rise to 20% 1 Jan 2014
- 15 December 2013 | Richard Asquith
Determining the correct French VAT rate
- For goods, the tax point is the date when the goods are supplied. This is when the goods are under the control of the customer and it takes legal title.
- For services, the tax point is the date of the provision of the service. Where there are staged payments spanning 1 January, the date of payment should be used to determine the appropriate VAT rate.
- For imported goods, the tax point is the date when the goods are cleared through customs and released into free circulation for consumption. For goods held in bonded warehouses with suspended VAT, then the date of release should be used to determine the correct VAT rate.
- For intra-community supplies of goods, the VAT point is 15 days following the month in which the supply was made. The exception to this rule if an invoice has been issued before this date – in which case the invoice date applies.
French VAT invoice administration
- For corrections after 1 January 2014 to old invoices (credit notes etc.), the 19.6% VAT rate should be used.
- VAT registered businesses will be permitted to issue invoices in 2013 with the new 20% VAT rate if there is certainty that the supply will take place after 1 January 2014.
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.