Holiday procedure in France: How does the VAT holiday settlement work?

During the summer holidays in France, there is a special procedure regarding the calculation of VAT. It involves the VAT declaration for July 2024 being based on the previous declaration from June 2024. This practice is approved and recommended by the French tax administration.

Key points: “Holiday process” in France

Under this described process, by the end of July, all concerned parties will receive notifications regarding the VAT payments for July 2024. We encourage timely settlement of these payments.

There is no need to worry if the VAT advance for July exceeds actual sales. It has been calculated based on June data and will be adjusted in the VAT declaration for August.

Transaction reports should be submitted as per normal procedures. The holiday procedure applies to tax declarations, not to report submissions.

How does the holiday procedure work?

• The VAT advance for July 2024 is calculated based on 80% of the VAT declaration submitted in June 2024. For previous periods, only 80% of the June 2024 sales will be indicated.
• If a zero declaration was filed in June 2024 or it is the first declaration month (for newly registered VAT payers), a zero declaration must also be filed for July 2024.
• Information about the calculated VAT amount will be provided before the end of July 2024.

Payment of VAT for the July VAT declaration

Payment of VAT for the July VAT declaration follows standard procedures:

• For VAT paid by direct debit (mandatory in France), the installment amount will be debited on the July VAT payment date (August 19, 2024).
• If payment is made by bank transfer and the bank does not execute the direct debit to the French Tax Office, you will receive a payment notice (to be settled by August 19, 2024).

The final transaction sum for July and August 2024 will be reported in the VAT declaration for August, due by September 19, 2024.

For any questions or additional information, please feel free to contact our team of experts, ready to provide assistance and support: Contact us – amavat®.