Changes to import VAT in France – effective 1st January 2022

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The French Tax Administration has announced that effective 1st January 2022, all import VAT will be mandatorily deferred to the French VAT return via the declaration of an import VAT reverse charge.

So, what is import VAT reverse charge?

The import VAT reverse charge is an existing mechanism in France, but previous eligibility requirements have made it very difficult to utilise. From 1st January 2022, all previous eligibility requirements will be waived. The shipper will simply need to hold a valid intra-EU VAT number in France and this will be noted on the customs declaration. Therefore, the shipper must communicate their French intra-EU VAT number to their freight agent so that the declaration can correctly be made. 

This is fantastic news to shippers that utilise France for importations – a huge cash-flow benefit will be seen by removing the requirement to outlay cash on import VAT at the border. As well as this, we should see a reduction in the number of sellers that have a credit with the French Tax Administration.

Import VAT reverse charge – practical use

Any shipments that clear French customs from 1st January 2022, will be subject to the import VAT reverse charge. The import VAT amounts will be lodged against the shipper’s French intra-EU VAT number.

When it comes to filing the French VAT return, the import VAT amounts declarable for the reporting period will be pre-filled on the seller’s VAT return already. These values will appear on the seller’s VAT return by the 14th of the month. Although the import VAT amount is pre-filled on behalf of the taxpayer, it is still the responsibility of the taxpayer to ensure this amount is correct. The French customs authorities have announced that they are opening a service whereby the taxpayer can check the total value of import VAT deferred for the period. 

Additionally, the deadline for submitting VAT returns in France for importers has been extended to the 24th of the month following the reporting period. This is due to the fact, that the pre-filled values may not show on the seller’s VAT return until the 14th, so an extension of the existing deadline is necessary. Please be clear that this deadline extension is for importers only. 

How AVASK can help?

AVASK is a firm of accountants and indirect tax experts, with a well-reputed specialism in global e-commerce expansion, international taxation, accountancy, business advisory, and consultancy services.

If you have any questions about how we can help you expand your business, get in contact with us. Our team of experts can assist with VAT registrationsVAT filing and compliance as well as Customs and Trade.