The French holiday procedure for charging VAT on the example of July 2021
There is a very popular “holiday procedure” in France during the annual summer holidays, approved and recommended by the French tax administration.
It consists of filing the VAT return for July 2021 on the basis of the previous return (of June 2021).
How does it work?
- The advance payment is calculated on the basis of 80% of the VAT return filed in June 2021. (when filing returns for previous periods, only 80% of the sales for June 2021 will be declared
- If you filed a nil return in June 2021 or if this is your first month of filing (newly registered VAT payer) – you will also file a nil return in July 2021.
- You will receive information about the amount charged before 31.07.2021.
Payment of the VAT for the July VAT return is made within the standard deadlines:
- For VAT paid by direct debit (obligatory in France): the amount of the instalment will be charged on the July VAT due date (19.08.2021).
- For payments by bank transfer (where your bank does not process direct debits for collection by the French Tax Authority itself): you will receive a payment notification (to be paid no later than 19.08.2021).
The final value of the transactions for July and August 2021 will be declared in the VAT return for August (to be submitted by 19.09.2021).
Please do not be concerned if the advance VAT payment for July will be higher than the actual sales. It is calculated on the basis of June sales and will be corrected in the VAT return for August.
Transaction reports should be submitted in the standard way.
“Holiday procedure” refers to the submission of returns, not to the dispatch of reports.
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