France Import VAT Changes - January 2022

Notable changes to import tax are coming into force on 1st January 2022, with import VAT for goods entering France affected as the management of import VAT is handed over to the French Tax Authority (DGFiP) from French Customs (DGDDI).

As of January 1st 2022, the payment and declaration of import VAT will need to be handled directly through French VAT return declarations as opposed to paying at the time goods enter customs, meaning that goods will be able to clear customs ahead of import VAT payment. The changes will be most significant for businesses looking to clear customs in France rather than transit through, and will be most beneficial to those already registered for VAT in France as they will be automatically placed on the postponed import VAT scheme. This also includes non-taxable people who have an intra-community VAT number.

The new rules will benefit businesses importing goods to France as, rather than paying at Customs and facing potential clearance delays, the payment will not have to be made until later that month when filing the French VAT return. It is important to note that the new method of payment will be relevant to all businesses acting as the importer of record in France, this means they will not only need to hold a French VAT number but will also have to file VAT declarations in the country to be able to profit from the new Customs process. French companies will automatically feel the benefits of the process, as well as countries from French territories around the world, who will receive a VAT number automatically. However, companies from foreign countries will be obliged to register for French VAT.

If you are unsure whether the changes to French import VAT will affect you, please contact Woodland here and one of our advisors will be able to assist you.