French VAT regimes and e-invoicing
Understanding French VAT regimes is not just a tax-lawyer's concern: it determines how to size a PDP, what format to use for outbound invoices, and who is in scope of the 2026 reform for issuance versus reception only.
The four VAT regimes
The French system runs on four regimes:
| Regime | Turnover thresholds (2026) | VAT obligations | Reporting |
|---|---|---|---|
| Franchise en base | ≤ €85,800 (goods) / ≤ €34,400 (services) | No VAT collection; "TVA non applicable, art. 293 B CGI" mention | No VAT return |
| Micro-BIC / Micro-BNC | ≤ €188,700 (goods) / ≤ €77,700 (services) | Usually under franchise (but can opt into the real regime) | Flat allowance (71% goods, 50% services, 34% BNC) |
| Real simplified (RSI) | ≤ €818,000 (goods) / ≤ €247,000 (services) | VAT collection, VAT deduction | Annual CA12 return + 2 semi-annual prepayments |
| Real normal (RN) | Above RSI thresholds or by option | VAT collection, VAT deduction | Monthly CA3 return (quarterly if VAT < €4,000/yr) |
A micro-entrepreneur (formerly auto-entrepreneur) is in franchise en base by default, hence does not apply VAT. Crossing the threshold puts them into RSI (or RN for large turnover) and they become VAT payers and issuers.
VAT rates on the mainland
| Rate | Use | Examples |
|---|---|---|
| 0% | Exemptions | Intra-EU B2B supplies, exports outside the EU, supplies to international merchant vessels |
| 2.1% | Special rate | Print and digital press, reimbursed medicines, audiovisual fee (legacy) |
| 5.5% | Reduced rate | Water, food off-premises, books, disability equipment, gas/electricity subscriptions, school canteens, energy renovation work |
| 10% | Intermediate rate | On-premises catering, hotels, passenger transport, home improvement (non-energy), non-reimbursed medicines |
| 20% | Standard rate | Most B2C sales of goods and services |
Intra-EU VAT and the FR VAT number
Any French VAT-registered company holds an intra-EU VAT number formatted as:
- FR — country prefix
- 2 digits — computed key (from the SIREN modulo 97)
- 9 digits — company SIREN number
Example: FR40123456824 (SIREN 123456824 + key 40). The number is validated against the European service VIES
and must appear on every invoice issued to or from another Member State.
It is mandatory in the EDIFACT INVOIC NAD+SU segment, and in
the UBL 2.1 cbc:EndpointID schemeID="9957" attribute.
Reverse charge — construction, waste, telecoms
Reverse charge (auto-liquidation) transfers the VAT collection obligation from the supplier to the customer. The supplier invoices VAT-exclusive; the customer declares VAT itself on its CA3 return (output VAT and deductible VAT, neutral operation).
Reverse-charge cases in France:
- Construction subcontracting (CGI art. 283-2 nonies) — the subcontractor invoices VAT-exclusive to the main contractor, which reverse-charges. Mandatory mention "Autoliquidation — art. 283-2 nonies du CGI".
- Waste, metals, CO2 quota trading (CGI art. 283-2 sexies) — anti-carousel fraud measure.
- B2B gas, electricity, heating/cooling (CGI art. 283-2 quinquies) — for trader-to-trader transactions.
- B2B telecommunications (CGI art. 283-2 octies) — operator-to-operator.
- Intra-EU electronic services (VAT at destination, declared through OSS / IOSS).
- Imports — since 2022, reverse charge on imports is systematic for VAT-identified payers in France (CGI art. 1695 II).
DOM-TOM — specific regimes
| Territory | VAT regime | Specific rates |
|---|---|---|
| Guadeloupe | DOM regime (LOOM) | Standard 8.5% · reduced 2.1% · super-reduced 1.75% |
| Martinique | DOM regime (LOOM) | Standard 8.5% · reduced 2.1% · super-reduced 1.75% |
| Réunion | DOM regime (LOOM) | Standard 8.5% · reduced 2.1% · super-reduced 1.75% |
| French Guiana | Special regime — VAT not applicable | 0% (offset by octroi de mer) |
| Mayotte | Special regime — VAT not applicable | 0% (offset by octroi de mer) |
| Saint-Barthélemy, Saint-Pierre-et-Miquelon, Saint-Martin (French side) | Special regime — local VAT | Varies by territory |
An invoice issued from Guadeloupe to the mainland is technically an intra-EU supply (0% VAT on the DOM side, reverse-charged by the mainland recipient) under CGI article 256. The 2026 mandate applies to DOM companies with specific adaptations (Mayotte and French Guiana, sitting under the special regime, are reception-only).
Impact on the 2026 reform
The reform timeline distinguishes:
- Mandatory reception on September 1, 2026 — every VAT-registered French company, including microbusinesses and franchise en base, must be able to receive a structured electronic invoice through a PDP. This means registering with a default PDP (or using the PPF in passive reception mode for very small businesses).
- Mandatory issuance on September 1, 2026 for large enterprises and ETI — every company over 250 employees or €50M revenue under RN or RSI.
- Mandatory issuance on September 1, 2027 for SMEs and TPEs — this deadline covers RN and RSI companies under 250 employees.
- Microbusinesses and franchise en base: reception only — they are not required to issue in structured format, but must be able to receive an electronic B2B invoice. A simple PDF still works outbound.
Practical consequence for a PDP: the customer matrix must qualify every recipient and issuer along three axes (company size, VAT regime, legal status) to route flows correctly and pre-validate mandate applicability.
Sources
- BOFiP — Bulletin Officiel des Finances Publiques, VAT section (BOI-TVA).
- Code Général des Impôts — articles 287, 289, 290 on invoicing obligations .
- impots.gouv.fr — electronic invoicing .
- Decree 2024-1099 of December 4, 2024 — technical 2026 reform .
- VIES — intra-EU VAT number validation .