VAT applicable to trade in goods within the European Union
Verified 28 May 2024 - Directorate for Legal and Administrative Information (Prime Minister)
The VAT taxation of trade in goods between two countries of the European Union depends on the VAT system of the company and the identity of its customer (individual or professional). We set out the rules that the company must follow if it buys or sells goods.
Purchase of goods
A professional established in France who buy a property in another EU country perform a intra-Community acquisition (ACI).
The intra-Community acquisition shall be subject to VAT of the country in which the goods are consumed. Thus, when a French trader purchases goods, the sale is generally subject to French VAT.
The rules differ when the company in France is subject to an actual VAT system or to the exemption from VAT.
Where a company carries out intra-Community acquisitions (ACIs) for the purpose of to consume goods in France (use them), such acquisitions shall be subject to the French VAT. The rules for invoicing, reporting and paying VAT vary whether or not the seller has a French VAT number.
The seller has a French VAT number
The seller must charge the French VAT to the French company.
If the French company has a right of deduction, it may deduct the VAT paid and get refund by the tax authorities. The deduction is made on his VAT return.
For more information on the VAT deduction, see the corresponding card.
How do I declare VAT?
When making intra-Community acquisitions (ACIs), the company shall not can no longer benefit from the simplified effective tax system. It must notify the tax authorities in order to switch to the normal real tax system:
Who shall I contact
The French company must indicate the amount HT: titleContent of the goods she bought at the line B2 Intra-Community acquisitions on its monthly or quarterly revenue statement #3310-CA3.
It must also indicate the basis and amount of VAT on line 08, 09, 9B or other according to the VAT rate.
They must add the amount of deductible VAT to line 23 of their VAT return.
Online tax account for professionals (EFI mode)
The seller does not have a French VAT number
Since the sale is subject to French VAT, the seller located in another EU country must not charge French VAT. He has to issue an invoice excluding tax.
Since he does not charge the French VAT to the French company, it is up to her to reverse charge VAT. This means that it must collect the French VAT on behalf of the tax authorities and remit it to them. If he has a right to deduct, he can deduct on his VAT return the amount of VAT which he has self-liquidated.
For more information on the VAT deduction, see the corresponding card.
How do I declare VAT?
When carrying out AICs, the French company cannot no longer benefit from the simplified effective tax system. It must notify the tax authorities in order to switch to the normal real tax system:
Who shall I contact
It must indicate the amount HT: titleContent of the goods she bought at the line B2 Intra-Community acquisitions on its monthly or quarterly revenue statement #3310-CA3.
It must also indicate the basis and amount of VAT on line 08, 09, 9B or other according to the VAT rate.
It must add the amount of VAT it paid on its ACIs to line 17 and the amount of VAT deductible to line 23.
If the French company benefits from the exemption from VAT , it is subject to French VAT but is not liable for it.
However, it may to pay VAT on its intra-Community acquisitions (ACIs).
The seller has a French VAT number
Based on the overall amount of the company's acquisitions on a calendar yearHowever, the VAT rules are different.
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Annual amount less tax less than € 10 000
Where the amount of AIC: titleContent on the calendar year is less than €10,000No, it's the salesman who must charge the VAT of his country.
Since the company is subject to the VAT exemption scheme, it is not entitled to deduct VAT on its purchases. Thus, it cannot obtain a refund of the VAT it pays on its ACIs.
However, it can opt to benefit from a real VAT system and thus obtain a right to deduct VAT. The rules on traders exempt from VAT will no longer apply to the company. It is the rules concerning traders subject to an effective system of taxation that will apply.
The option must also be requested via his email on his business account impots.gouv.fr.
Online tax account for professionals (EFI mode)
For more information on the VAT deduction, see the corresponding card.
Annual amount excluding tax over €10,000
The acquisition is subject to French VAT. The seller must charge French VAT because he has a French VAT number.
As the company carries out transactions within the European Union, it must apply for an intra-Community VAT number to its EIS via its messaging service on its impots.gouv.fr business account:
Online tax account for professionals (EFI mode)
As it is subject to the VAT exemption scheme, it does not enjoy the right to deduct VAT on its business purchases. In other words, it cannot obtain a refund of the VAT paid on its ACIs. In order to obtain the right to deduct, it must opting for a real VAT system.
The option must also be requested via his email on his business account impots.gouv.fr.
For more information on the VAT deduction, see the corresponding card.
The seller has a foreigner VAT number
If the French company benefits from the exemption from VAT , it is subject to French VAT but is not liable for it.
However, it may to pay VAT on its intra-Community acquisitions (ACIs).
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Annual amount less than €10,000
Where the amount of intra-Community acquisitions (ACIs) in a calendar year is less than €10,000No, it's the seller who has to charge VAT from his country to the French company.
As the company in France is subject to the VAT exemption scheme, it is not entitled to deduct VAT on its purchases. Thus, it cannot obtain a refund of the VAT it paid on its ACIs.
However, the French company may opt to benefit from a real VAT system and thus obtain a right to deduct VAT. The rules on traders exempt from VAT will no longer apply to the company. It is the rules concerning traders subject to an effective system of taxation that will apply.
The option must also be requested via his email on his business account impots.gouv.fr.
Online tax account for professionals (EFI mode)
To learn more about VAT deduction, you can consult the relevant sheet.
Annual amount over €10,000
The acquisition is subject to French VAT. The seller located in another EU country must not charge the French VAT to the company. He has to issue an invoice excluding tax.
The company in France which makes intra-Community purchases in excess of €10,000 each year can then no longer benefit from the VAT exemption system and is subject to a normal real VAT system. It must then charge VAT to its customers and remit it it to the tax authorities. It will also be able to deduct VAT from its business purchases at the time of its VAT return.
For more information on the VAT deduction, see the corresponding card.
It must therefore apply for an intra-Community VAT number to its EIS via its messaging service on its impots.gouv.fr account in order to be able to auto-liquidate VAT on its purchases:
Online tax account for professionals (EFI mode)
It must indicate the amount HT: titleContent of the goods she bought at the line B2 Intra-Community acquisitions on its monthly or quarterly revenue statement #3310-CA3. It must also indicate the basis and amount of VAT on line 08, 09, 9B or other according to the VAT rate. It must add the amount of VAT it paid on its ACIs to line 17 and the amount of VAT deductible to line 23.
Sales of goods
What is an intra-Community delivery?
In principle, the sale of goods between traders subject to VAT is subject to VAT of the country of the purchaser. Thus, in the case of an intra-Community supply, the sale is not subject to French VAT.
Intra-Community delivery is when the sale fills all conditions following:
- You have to pay for it.
- The buyer is subject to VAT.
- The seller is subject to VAT in his country.
- The goods are dispatched and transported outside France to a European country (the delivery note may be required to provide proof of transport).
What is the formalism to be respected?
Where a French company makes intra-Community supplies and they are subject to VAT in the country of the purchaser, it must not charge VAT.
It must issue an invoice without VAT and indicate its intra-Community VAT number and the buyer's. It shall also include the following mandatory statement: VAT exemption, Article 262b I of the General Tax Code. To find out more about the mandatory information to be indicated on invoices, you can consult the consult the relevant sheet.
How to declare intra-Community supplies?
The French company must declare its intra-Community supplies either on line F2 for the declaration #3310-CA3 (normal real speed) or row 04 for declarations #3517 -S CA12 (real simplified procedure).
Where a company sells goods to an individual or to a company not subject to VAT in another country of the European Union, we are talking about intra-Community distance selling. A company may not be subject to VAT where it is subject to the VAT exemption system or where it benefits from a derogation system.
Business seller subject to a real VAT system
The VAT rules are different depending on the duty-free amount of all distance sales of the company on a calendar year :
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Annual amount less tax less than € 10 000
The sale is subject to French VAT.
FYI
Intra-Community supplies of new means of transport or goods supplied after assembly or installation shall not be distance sales.
Annual amount excluding tax over €10,000
The sale is subject to the VAT of the country in which the customer of the French company is located.
FYI
Intra-Community supplies of new means of transport or goods supplied after assembly or installation shall not be distance sales.
How do I declare VAT?
To declare VAT, the French company has 2 solutions:
- It can register for VAT in the buyer's country by requesting an intra-Community VAT number from the buyer's country. It can then charge the VAT of the country of the customer and remit it directly to the corresponding State.
- It can use the one-stop shop for VAT to remit the VAT invoiced to the State in which its customer is located. Once the branch is used for the first time, it is obliged to use it to declare the VAT on all distance sales it subsequently makes.
It must also establish every month a VAT summary statement by 10e working day of the month following the month in which the deliveries took place.
The declaration is to be completed on his personal space on site impots.gouv.fr:
Business seller not subject to VAT or exempt from VAT
The VAT rules are different depending on the duty-free amount of all distance sales of the company on a calendar year :
Répondez aux questions successives et les réponses s’afficheront automatiquement
Annual amount less tax less than € 10 000
The sale is not subject to VAT.
FYI
Intra-Community supplies of new means of transport or goods supplied after assembly or installation shall not be distance sales.
Annual amount excluding tax over €10,000
The sale is subject to the VAT of the country in which the customer of the French company is located.
FYI
Intra-Community supplies of new means of transport or goods supplied after assembly or installation shall not be distance sales.
The company is obliged to register for VAT where the annual amount HT: titleContent of its distance sales exceeds €10,000. She must therefore apply for an intra-Community VAT number via the email of her business area on the website impots.gouv.fr:
Online tax account for professionals (EFI mode)
How do I declare VAT?
To declare VAT, the company has 2 solutions :
- It can register for VAT in the buyer's country by requesting an intra-Community VAT number from the buyer's country. She can then invoice her customer for the VAT in her country and remit it directly to the corresponding State.
- It can use the one-stop shop for VAT to remit the VAT invoiced to the State in which the customer is located. As soon as it uses the counter once, it is obliged to use it to declare the VAT of all distance sales it makes.
It must also establish every month a VAT summary statement by 10e working dayof the month following the month in which the deliveries took place.
The declaration is to be filled in on his personal space on the website impots.gouv.fr:
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