How to recover French VAT on your expenses? 

If you want to recover VAT from France, you first need to know what are the regulations that govern it. If you went on a business trip and you don’t claim your VAT back from France, your company could lose a lot of money, go here and find out the best way to recover your French VAT!

VAT rates in France according to type of product and service

As is the case in other countries, VAT in France is divided into three brackets. A general rate of 20% applies to most products and services for businesses. For example, catering, entertainment, tolls and, partially, fuel.

VAT of 10%, which applies to food delivery services, lodging in hotels, bars and night clubs (except alcohol), culture-related theme parks, and the supply of organic fuel such as wood.

Also, the 5% VAT, better known as super-reduced VAT. This is applied to various food products, energy supplies, accommodation in social venues, entrance to sporting events and feminine hygiene products.

And finally, France has a second super-reduced VAT of 2.1% that applies on an exceptional basis. This applies to certain medicines and blood supplies, access to cultural events such as theater, broadcasting licenses for public televisions, newspapers and other types of publications that are of general interest.

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Why recover French VAT?

If you do not recover the VAT, your company could be losing a lot of money. Under French law, companies established or registered for VAT purposes may claim input VAT in France, provided that they have incurred these expenses in the last two years up to December 31, 2022.

For this purpose, it will be necessary that the invoices comply with a number of requirements imposed by French tax law. It must also be analyzed whether the expenses presented are deductible for VAT in France.

What are the deductibility criteria for recovering VAT from France?

You will be able to deduct input VAT on the purchase of goods and services, as long as they are related to your business activity. Below is a list of expenses for which VAT can be recovered in whole or in part in France. These are:

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How to recover French VAT through paid invoices?

In order to recover the French VAT, it is necessary to present the invoices of your expenses and that they comply with a series of requirements established by the French legislation. During the process of claiming the VAT refund, you must analyze if they are deductible in France.

It may happen that invoices issued by suppliers do not comply with the minimum content required by law. As a result, the company loses the opportunity to recover VAT.

In that sense, you must be attentive that the invoices issued by French suppliers do not contain errors and comply with the minimum requirements. You can also contact the supplier and request a rectifying invoice so that the original invoice is modified.

Another alternative would be to sign an invoicing agreement between the supplier and a third party or agent. In France, it is possible for a third party to issue invoices in the name of a supplier. 

However, with the supplier’s authorization, it is possible to issue invoices in the supplier’s name. French law establishes the following requirements for these invoices:

1. It must include all the information required by current regulations.
2. The numbering sequence used by a third party must be chronological, continuous and specific to the taxable person concerned. Therefore, it must not form part of the invoice sequences issued by the agent on his own account or on behalf of another principal.
3. It is recommended that invoices issued by a third party include the statement as an invoice drawn up by A in the name and for the account of B.

Keeping your invoices

It is important for you to know that invoices must be kept with their original content and in an orderly manner. This should be done through a means that guarantees the authenticity of their origin, the integrity of their content and their legibility.

Professionals and entrepreneurs are obliged to keep invoices for 6 years from the date and operation in which the invoice was made. However, storing so many receipts or invoices for so long can lead to space or logistical problems in companies.

As a solution to this, the French legislation offers the possibility to keep this documentation in digital format by means of article A102 B-2. That way, you will only need the electronic signature that complies with the general security reference system. In addition, each file is also required to have a time stamp.

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Did you recently travel to France on business and need to recover the VAT on the expenses you incurred? Contact our professionals at TAS Consulting through tasconsultoria@tas-sl.es and they will help you recover your French VAT. Through a complete advice and the work of our entire tax department, you will recover your VAT faster than you can imagine, what are you waiting for?