Value Added Tax in France
Describe how the VAT is running out in France, its rules and process
- Who pay TVA in France?
- How to be VAT registered in France?
- How often to pay VAT in France?
- Why electing BUDIZ to help you with sending your VAT declarations?
Value Added Tax is:
- A consumption tax placed on a product whenever value is added at each stage of the supply chain, from production to the point of sale
- A system of indirect taxation of the sale of goods and services to final consumers
- Collected in stages through what is called “the chain of supply”
- More than 160 countries around the world use value-added taxation, and it is most commonly found in the European Union
French VAT rate :
- Who pay VAT in France?
French VAT rules are based on regulations drawn up by the EU, of which France was a founding member. The standard French VAT rate is currently 20%.
The French VAT law is mostly ruled by French Tax Code (CGI). Other related declarations are also administered by the Direction Generale des Douanes et Droits Indirects.
You are liable for VAT in France if your business meets the following criteria:
- Supplying goods/services or importing goods
- The person supplying the goods/services or importing the goods is liable to VAT
- The good/services must be considered an independent and usual financial activity
Example of VAT at 20%
Value Due or Creditable = VAT charged on sales (Output tax) – VAT paid on purchases (Input Tax)
2. How to be VAT registered in France?
This is a question that troubles many business owners when they do business within global markets. Indeed, every country has its own system.
In France, you’ll need to register your foreign company for VAT payments (called TVA in France) so your business can charge the correct amount of VAT and not be penalized.
Process of the VAT in France:
3. How often to pay VAT in France?
French VAT is paid either:
-Annually (with 2 advance payments in July and December)
4. Why electing BUDIZ to help you with sending your VAT declarations?
If all this sounds perplex, there is an easier way to submit your VAT declarations. Indeed, this can be done by endorsing a chartering accountant who can hand over the process of your VAT registration.