VAT Returns & Recovery in France in 2022
In general, sales of goods and provision of services in France are subject to VAT, unless certain exclusions apply. Foreign businesses that do not have a physical presence in France but carry out activity in France can be subject to French VAT. In this case, they need to be VAT registered to collect VAT and submit VAT returns.
If your non-French company does not conduct VAT-liable transactions in France, VAT on expenditures incurred in France for your professional activity may be recovered, under specific conditions.
VAT Returns in France
Filing deadlines
Article 287 of the French General Tax Code mentions both a normal and a simplified filing scheme, each with different filing deadlines. Taxpayers have the option to also apply for a seasonal filing scheme under certain circumstances.
Normal VAT Regime
Under the Normal VAT Regime, taxpayers who are liable for VAT must file a monthly French VAT return by using form CA3. A national calendar is used to set the specific day of the month for filing the VAT return. This calendar is based on the taxpayers’ names and registration numbers (in general this can take place from the 15th to the 24th of every month). This applies to taxpayers not eligible for the Simplified VAT scheme.
If the VAT due is less than 4,000 euros, a taxpayer that is registered under the normal regime may file on a quarterly basis.
Seasonal Filing Regime
Selling in France?
VAT Recovery in France
If your non-French company does not conduct VAT-liable transactions in France, it may be repaid VAT on expenditures incurred in France for its professional activity under specific conditions.
To claim a VAT refund if you have a foreign firm founded in a European Union member state, you must:
- File your claim using the electronic methods made available to you by the State in which you are based, in conformity with the terms of Council Directive 2008/9/EC of February 12, 2008.
- Scan actual invoices or importation documents and submit them electronically. When the taxable amount on an invoice exceeds EUR 1,000, submission is required. When it comes to fuel, the threshold is EUR 250. Scanned invoices must be entered in the same sequence as their line-by-line counterparts.
- Respect the refund timeframes and minimum thresholds.
- Claims must span more than one calendar year (threshold EUR 50) or less than three calendar months (threshold EUR 400).
- Claims may not span more than two calendar years.
Up to four claims can be filed, each for a minimum of three calendar months, plus a supplementary annual claim:
- File your claim by September 30 of the calendar year after the refund period. You may file two claims prior to this date to expedite the processing of your claim.
- Provide your banking information in the form of IBAN and BIC codes.
Foreign firms based outside of the European Union
This sort of refund is intended for taxable persons based outside the European Union who are not based in France and do not provide products or services that are taxable in France. The expenses you are claiming a VAT refund for must be related to your business activity. The following are the primary exceptions: Accommodation or housing expenditures incurred by your firm for the benefit of its directors or workers; on the other hand, expenses for third parties may be permitted under certain situations; Expenses for vehicles used to carry people and the services linked with them.
Procedure
To get a VAT refund, you must do the following:
- Fill out Refund Claim Form No. 3559 SD. The form must be written in French and denominated in euros. Please include contact information (name, phone number, and e-mail address) for a person who the department can contact if necessary to expedite processing.
- Please include all original bills. They will be reimbursed to you as soon as your claim is processed.
- Meet the minimum refund thresholds (EUR 400 for quarterly claims and EUR 50 for yearly claims).
- File your annual refund claims by June 30 of the following year. If you are requesting a quarterly refund, you must do so within the month following the calendar quarter in question.
- Include the name of the institution, its complete address (city and country), the account holder’s name, and the IBAN and BIC codes for the beneficiary bank account. This will speed up the return process while also saving you money on bank costs. For returns to French bank accounts, please provide a RIB (Relevé d’Identité Banca ire).
VAT Relief
VAT on Imported Goods
When your imports arrive in France (customs clearance), you must pay the following VAT to French Customs: As a result, foreign goods are taxed at the same rate as French goods. However, as of January 1, 2015, enterprises who are permitted to employ a clearance procedure with a single domicile (PDU) can choose to roll over the amount of tax due on import transactions to their annual turnover return filed with the tax authorities.
Let us remind you that a customs duty is only levied when the value of the consignment exceeds EUR 150, whereas import VAT is levied on commercial consignments of any value. Since July 1st, 2021, the import VAT exemption that was formerly applied to small consignments valued at EUR 22 or less has been eliminated.
Nonetheless, parcels with a value of less than 1 euro that are dispatched to French consumers from a non-EU nation can still qualify from an import VAT exemption if the foreign online merchant has chosen to register with IOSS through an Intermediary.
Last Updated: 14/02/2022
Disclaimer
The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax
