Effective date: 4 June 2025
Type: Legislation
The French reverse-charge VAT rule requires all French VAT-registered businesses, including VAT-exempt sectors like healthcare and finance, to self-account for VAT on services received from non-French suppliers. This measure implements Article 196 of the EU VAT Directive and ensures proper VAT collection on cross-border service transactions. Businesses must register for VAT, even if they are usually exempt, and report the reverse-charged VAT through their French CA3 VAT return. Failure to comply may result in penalties from the French tax authorities, regardless of whether any VAT was originally charged. The regulation aims to align France with EU-wide VAT compliance standards and reduce fraud in cross-border service supply chains.
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