VALUE ADDED TAX

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PRINCIPLES
 Tax on consumption of goods and services
 Tax paid by the final consumer
 Companies must calculate the VAT and bill it to its
customers
 Companies collect the VAT on behalf of the tax authority
 Companies can deduct the VAT paid on their purchases

 VAT mechanism

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SCOPE

Transactions Taxed
falling transactions
within the VAT taxable
scope of transactions
Economic VAT Exempted
transactions transactions

Transactions
outside the
scope of VAT

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 Territoriality of VAT

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Principles

Transactions concerning delivery of goods

with other
in France in EU
countries
All taxable entities have
an identification number.
Sales to a EU customer is
Taxed if the transactions taxed in the country of Export : exempted
are in the scope of destination.
taxable ones Imports :: Taxed in France
Purchase from a EU
supplier is taxed in France

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VAT on services
 Generally services sold to firms are liable to VAT in
the country where the customer firm is.
 On the contrary, services delivered to individuals are
liable to VAT in the country where the supplier is.

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COLLECTED VAT
 Firms liable to VAT collect the tax

 Three rates exist in France:

 Normal rate : 20%
 Intermediate rate : 10%
 Reduced rate : 5,5%

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Operative event and due date

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Formal requirements
 The following information must be clearly written on the
invoice:
• Name of supplier
• Name of customer
• Value of the transaction excluding VAT (HT)
• VAT rate
• Value of VAT
• Value of transaction including VAT (TTC)

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Material requirements
 The expense must be necessary for the day to day
running of the entity

 Are excluded:
• personal expenses
• expenditures on luxuries
• goods/assets used personally for a share exceeding 90%

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VAT SCHEMES

Normal Simplified Micro

Turnover on sale of > 777 000€HT 81 500<T<777 000 < 81 500€HT
goods
Turnover on > 234 000€HT 32 600<T<234 000 < 32 600€HT
services
Periodicity monthly annual -
Declaration form CA3 CA12 -
Due date 15th of M+1 Balance on 30th -
April Y+1

Advance
instalments

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PAYING VAT
 Online procedures are compulsory for:
• Companies liable to corporate tax
• Companies not liable to corporate tax but having a turnover
exceeding 80 000€HT
 Refund of VAT credit must also be done online
 Online declaration and payment will be compulsory for all
« VATpayers » as from 1st october 2014

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