INTRA-COMMUNITY VAT
Afc Tax Representative, VAT specialist, provides for guidance for the following matters.
With Afc Tax Representative, your VAT is taken care of to the maximum possible extent:
Registration, returns, VAT claim, tax audit…
A human sized organization
VAT REGISTRATION in France and in the EU
Your company is established in an EU or non-EU Member State and carries out commercial transactions.
Certain flows of goods and/or services require you to register with the relevant authorities.
Reimbursement of French and European VAT
Your company is established in a Member State of the European Union or outside and makes purchases subject to VAT without having a permanent establishment there.
Subject to certain formal and substantive conditions, you can apply to the tax authorities in each country for a VAT refund.
There are two procedures for reclaiming VAT paid on your purchases in France and the European Union:
- If your company is based in the European Union: the "9th Directive" procedure.
- If your company is based outside the European Union: the "13th Directive" procedure.
One-stop VAT shop - IOSS / OSS
The VAT rules have changed with the implementation of the e-commerce reform on 1 July 2021.
Two new Guichet Unique schemes have been created: IOSS and OSS.
- The Import One Stop Shop (IOSS) is an electronic portal that businesses can choose to fulfil their VAT obligations on distance sales of imported goods, valued at less than €150. The VAT exemption on imports of low-value consignments (under €22) has been abolished since 1 July 2021.
- The OSS one-stop shop enables companies to declare their sales of goods and/or services on a BtoC basis.
If they choose to do so, companies are no longer required to register with the tax authorities in each Member State of consumption in order to declare and pay the VAT due.
VAT is declared and paid to a single Member State via the Guichet Unique.
Alternatively, companies retain the option of registering in each country where they make sales and declaring VAT. The majority of transactions are taxable in the Member State of consumption. All commercial goods imported into the European Union from a third country or territory are subject to VAT, regardless of their value.
Reverse charge of VAT
The reverse charge of VAT on imports, which is compulsory since January 1st 2022, involves business registering for VAT in France.
Thanks to this system, your company can import goods from non-EU countries without having to pay VAT in advance, but can instead reverse charge the VAT on its VAT return.
Tax audits
In the event of a tax audit, the authorities require you to be able to provide a "Reliable Audit Trail". In other words, your company must be able to justify all its commercial transactions.
You are also required to provide the tax authorities with a copy of the accounting records file (FEC). This computerised accounting file contains all the accounting entries.
VAT declaration and payment
In compliance with the regulations, your company must periodically file a VAT return (usually monthly) by a specified deadline. Where applicable, your company is also required to pay the tax. Any delay may give rise to penalties.