Reverse charge of import VAT

The reverse charge of import VAT

The reverse charge of import VAT will be generalized and automated in France from 1, January 2022.

France has decided to make all importers benefit from the reverse charge of import VAT. This measure, which is of great interest to businesses for obvious reasons of cash flow gains, will apply to all operators, whether they are established in France or abroad.

What is the reverse charge of import VAT?

Also known as “postponed VAT accounting” in the UK, the reverse charge mechanism allows an importer to avoid paying French VAT at the time of importation.

This VAT is simply reported and declared to the French authorities in a French VAT return. It is collected and deducted in the same return and results in a zero transaction in terms of payment.

Are you concerned?

You are concerned by these new rules if your company imports products in its name in France. To find out if this is the case, your company must appear in box 8 or 44 of the import declarations.

How is this measure beneficial and does it make France more attractive?

This reverse charge mechanism will allow all companies to avoid heavy and costly pre-funding. It takes several months for import VAT refund requests to be granted to traders.

How can I stop paying import VAT?

Quite simply, by registering for VAT in France!

RMB can help you in these steps and take care of the VAT registration formalities for you. Thus, you will facilitate your administrative procedures, save time and money!

Please note that the average time for VAT registration in France is 2 to 3 months. We therefore advise you not to delay if you want to be ready for January 1st 2022.

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