VAT Regimes in France

In France, value added tax (VAT) is the largest source of state tax revenue. For business owners, it is also one of the most regular tax obligations: you collect it, deduct it, declare it and pay it. In 2026, four rates apply (20%, 10%, 5.5% and 2.1%), three regimes coexist, and each business falls into one depending on its activity and turnover.

This guide summarises VAT rates in France for 2026, how collection and deduction work, the calculation formulas, the exemption thresholds and the filing obligations. You will also find answers to the most frequently asked questions about VAT in France.

What is VAT and how does it work?

VAT is an indirect tax on consumption, codified in the French General Tax Code (CGI), articles 256 to 298. It is borne by the end consumer, but it is the business that collects it on behalf of the state. In practice, you add VAT to your selling prices, pay it over to the tax authorities and recover the VAT paid on your business purchases.

The mechanism is based on three amounts:

• Output VAT (collected) : the VAT you charge your customers (on your sales).

• Input VAT (deductible) : the VAT you pay on your business purchases (suppliers, equipment, services).

• VAT payable : the difference between the two (output minus input). This is the amount you pay over to the state.

When input VAT exceeds output VAT, the state owes you money: this is called a VAT credit (see the dedicated section below).

Output VAT and input VAT: the difference

Take an illustrative example. A services company invoices €10,000 excluding VAT of services at the standard 20% rate. It therefore collects €2,000 of VAT on behalf of the state. Over the same period, it has paid for €4,000 excluding VAT of business purchases, i.e. €800 of input VAT.

The VAT payable is €2,000 (output) minus €800 (input), i.e. €1,200. This is the amount the company pays over to the tax authorities.

Who is liable for VAT in France?

Anyone who regularly and independently carries out economic transactions (sales of goods, services, liberal activities) is liable for VAT. This covers the vast majority of businesses: commercial companies, craftspeople, traders, liberal professions and farmers.

Some activities are exempt from VAT (medical activities, education, banking transactions), while others fall under the VAT exemption threshold scheme (see the dedicated section). The scope and exemptions are defined in the BOFiP (BOI-TVA-CHAMP), the tax authorities' official guidance.

The 4 VAT rates in France in 2026

France applies four VAT rates in 2026, set by the CGI (articles 278 to 281 nonies) and confirmed by the tax authorities' website and economie.gouv.fr. The standard 20% rate applies by default: anything not expressly subject to a reduced rate falls under it.

Rate — Application — Examples of goods and services

20% (standard) — By default, most goods and services — Clothing, furniture, business services, telecommunications, SaaS subscriptions

10% (intermediate) — On-site dining, passenger transport, renovation work, accommodation — Restaurant meals, train tickets, home renovation, hotel nights

5.5% (reduced) — Essential goods, books, household energy — Food, books and digital press, gas and electricity subscriptions

2.1% (special) — Press, certain reimbursable medicines, TV licence — Newspapers and magazines, reimbursable pharmaceutical products

Standard rate of 20% (default)

The 20% rate is the general rate. It applies to most sales of goods and services in mainland France, unless otherwise provided. Clothing, household appliances, furniture, business services, consultancy fees and software subscriptions are all subject to 20%.

Intermediate rate of 10% (restaurants, transport, building work)

The 10% rate covers a varied set of transactions. On-site dining is taxed at 10%, while takeaway generally falls under the reduced 5.5% rate (we explain these rules on our page dedicated to VAT in the restaurant sector). Improvement, conversion and maintenance work on homes also benefits from 10%, or even 5.5% for energy-efficiency work.

Passenger transport, admission to entertainment venues and hotel or campsite accommodation are also taxed at 10%.

Reduced rate of 5.5% (essential goods, books, energy)

The 5.5% rate covers essential goods and certain cultural or energy products. It includes food products (with a few exceptions such as alcohol and sugary drinks), books, gas and electricity subscriptions, and equipment and services for dependent people.

Special rate of 2.1% (press, reimbursable medicines)

The 2.1% rate is the lowest. It applies to press publications, the TV licence fee and certain medicines reimbursed by the French social security system. This rate mainly concerns specific sectors; it almost never appears in the everyday invoicing of a typical business.

How do you calculate VAT?

The VAT calculation always starts from the price excluding VAT (HT). Three formulas cover the cases a business owner will encounter.

Calculating VAT from a price excluding VAT

To go from the price excluding VAT to the price including VAT (TTC), multiply the price excluding VAT by (1 + VAT rate).

• At the standard 20% rate: price excl. VAT × 1.20 = price incl. VAT.

• At the intermediate 10% rate: price excl. VAT × 1.10 = price incl. VAT.

• At the reduced 5.5% rate: price excl. VAT × 1.055 = price incl. VAT.

Example: a sale of €1,000 excluding VAT at the standard rate gives €1,200 including VAT, of which €200 is VAT. We go through the conversions and special cases on our page calculate your VAT.

Working back to the price excluding VAT from a price including VAT

Conversely, when you know a price including VAT and want the price excluding VAT, divide by (1 + rate).

• At the standard 20% rate: price incl. VAT / 1.20 = price excl. VAT.

• At the intermediate 10% rate: price incl. VAT / 1.10 = price excl. VAT.

• At the reduced 5.5% rate: price incl. VAT / 1.055 = price excl. VAT.

Example: a price of €1,200 including VAT at the standard rate gives €1,000 excluding VAT.

Example of calculating the VAT payable

Let's go back to the services company above. In one month, it invoices €12,000 excluding VAT of services at the standard rate, i.e. €2,400 of output VAT. It pays €5,000 excluding VAT of business purchases, i.e. €1,000 of input VAT.

The VAT payable is €2,400 (output) minus €1,000 (input), i.e. €1,400. This is the amount to declare and pay to the tax authorities for that period.

The VAT exemption threshold scheme: who benefits?

The VAT exemption threshold scheme (franchise en base) relieves small businesses from charging and paying over VAT. It is an immediate cash flow advantage, but also a limitation: the business cannot recover VAT on its purchases and must invoice its sales excluding VAT.

VAT exemption thresholds in 2026

In 2026, the VAT exemption thresholds (mainland France) remain as follows, unless uprated in the official public finance bulletin:

Type of activity — Exemption threshold (2026)

Sales of goods, food for on-site consumption, accommodation services — €91,900 of annual turnover

Other services and regulated liberal activities — €39,100 of annual turnover

As long as turnover stays below these thresholds, the business is not liable for VAT. If it exceeds them during a year, it becomes liable from the first day of the month in which they are exceeded. These thresholds directly concern micro-entrepreneurs, who in practice fall under the exemption scheme as long as they stay below the ceilings (see our details on micro-entrepreneur thresholds).

The 3 VAT regimes: which one applies to your business?

Your VAT regime depends on your turnover and the nature of your activity. Three regimes exist in France in 2026, as detailed by entreprendre.service-public.fr.

VAT exemption threshold scheme

Described above, the exemption applies to businesses below the thresholds of €91,900 or €39,100 of turnover. The business does not charge VAT and does not pay it over. In return, it cannot recover VAT on its purchases either.

Simplified tax regime (RSI)

The simplified tax regime, or RSI, applies to businesses whose turnover falls between the exemption thresholds and the following limits:

• €840,000 for sales of goods, food for on-site consumption and accommodation services.

• €254,000 for other services.

Under the RSI, the business pays two VAT instalments during the year (in July and December), then makes an adjustment on an annual return (form CA12). This regime lightens the filing obligations compared with the standard regime.

Standard real VAT regime

The standard real regime is compulsory for businesses that exceed the RSI thresholds. It requires a monthly VAT return (or quarterly for small businesses) on form CA3. Output VAT and input VAT are declared every month, and the balance is paid (or refunded in the case of a credit) at each deadline.

The choice of regime has a direct impact on cash flow and the administrative workload. To plan ahead, the choice of your tax regime depends on your activity and your volume of business.

How do you declare and pay VAT?

VAT is declared and paid online, in the professional area of impots.gouv.fr. The form and frequency depend on the regime.

Returns under the standard real regime (CA3)

Under the standard real regime, VAT is declared every month on form CA3. Businesses whose annual VAT is below €4,000 can opt for a quarterly return. The return must be filed and the balance paid between the 15th and the 24th of the following month, depending on the filing date allocated.

Returns under the simplified regime (CA12 and instalments)

Under the simplified regime, the return is filed once a year on form CA12. Two instalments are paid during the year (July and December), calculated on the basis of the previous year's VAT. The annual adjustment brings the amount into line with the actual VAT due. We explain instalments and their deadlines on our page dedicated to VAT instalments.

Recoverable VAT, VAT credits and refunds

Input VAT gives the business a right to recover it. When it exceeds output VAT, the state owes money: this is the VAT credit.

What is a VAT credit?

A VAT credit arises when input VAT (on purchases) exceeds output VAT (on sales) over a period. This often happens after a major investment (equipment, vehicle, stock) or for a young business that is starting out. The VAT credit can be carried forward to the next return or claimed as a refund.

How do you get a VAT credit refunded?

A VAT credit refund is subject to threshold conditions (€760 for an annual claim, €5,000 for a monthly or quarterly claim). The claim is made online on impots.gouv.fr, using the VAT credit refund form. We cover the conditions and timeframes on our page dedicated to VAT refunds.

Specific VAT: Corsica, overseas departments and intra-EU transactions

Mainland France is not the only territory where VAT applies. Corsica applies special rates (in particular 10% for restaurants and 2.1% on certain essential goods), with no 20% VAT. The overseas departments (DOM) apply reduced VAT, with rates of 2.1%, 1.75% and 0.9% depending on the products and territories (Guadeloupe, Martinique, Réunion, French Guiana).

Intra-EU trade follows specific rules: intra-EU sales and acquisitions require an intra-EU VAT number and a specific return. The liability threshold for intra-EU acquisitions is set at €10,000 a year: below it, transactions remain subject to the rules of the country of departure; above it, the rules of the country of arrival apply.

FAQ: your questions about VAT in France

What is the standard VAT rate in France?

The standard VAT rate is 20%. It applies by default to most goods and services (CGI art. 278).

What are the different VAT rates in France in 2026?

In 2026, there are four rates in mainland France: 20% (standard), 10% (intermediate), 5.5% (reduced) and 2.1% (special). Each covers a list of goods and services specified in the CGI (articles 278 to 281 nonies).

What VAT rate applies to restaurants?

On-site dining is subject to 10%. Takeaway generally falls under the reduced 5.5% rate, except for alcoholic drinks (20%). Details on our page VAT in the restaurant sector.

What VAT rate applies to renovation work?

Renovation work on homes (improvement, conversion, fitting out) is subject to 10%. Energy-efficiency work (insulation, efficient heating) benefits from 5.5%.

How do you calculate VAT from a price excluding or including VAT?

To go from excluding VAT to including VAT, multiply the price excluding VAT by (1 + rate). To go from including VAT to excluding VAT, divide the price including VAT by (1 + rate). Examples and a summary table on our page calculate your VAT.

When does a business become liable for VAT?

A business becomes liable as soon as it exceeds the exemption thresholds (€91,900 or €39,100 of annual turnover in 2026), from the first day of the month in which they are exceeded.

Is a micro-entrepreneur subject to VAT?

No, as long as their turnover stays below the VAT exemption thresholds. Above them, they become liable and must charge, declare and pay over VAT.

What is input VAT?

Input VAT is the VAT paid by the business on its business purchases (suppliers, equipment, expenses). It is deducted from output VAT to calculate the VAT payable.

What is a VAT credit?

A VAT credit arises when input VAT exceeds output VAT over a period. The business can carry it forward to the next return or claim a VAT refund subject to certain threshold conditions.

When and how do you declare VAT?

The frequency depends on the regime: monthly or quarterly return (CA3) under the standard real regime, annual return with two instalments (CA12) under the simplified regime. Everything is done online at impots.gouv.fr.

Planning ahead for your VAT obligations

VAT in France in 2026 rests on a stable framework: four rates, three regimes and thresholds published every year. What varies from one business to another is how often returns are filed, the amount payable and the resulting cash flow management. The real difficulty is not knowing the rates, but meeting the deadlines, not missing a return and recovering everything that can be recovered.

To stop managing your VAT on the fly, call on a chartered accountant for your VAT returns. GME Audit, a firm led by Steeve Elharrar, chartered accountant and statutory auditor, formerly with KPMG and Deloitte, handles your returns and anticipates your deadlines. Your invoices and bank statements are fed automatically into Pennylane: you see your VAT up to date, without waiting for the annual adjustment.

Your situation depends on your structure, your activity and your turnover. Request a quote, and we will reply with a precise proposal.

Updated for the 2026 financial year. Sources: impots.gouv.fr, economie.gouv.fr, BOFiP, Légifrance (CGI, art. 278 to 281 nonies).