VAT in France, known locally as Taxe sur la Valeur Ajoutée (TVA), is a consumption tax charged at a standard rate of 20% on most goods and services, with reduced rates of 10%, 5.5%, and 2.1% for specific categories. Businesses collect it at each stage of the supply chain, but the cost lands on the final consumer. Certain transactions are exempt, and non-EU visitors can reclaim VAT on goods they take home.
The Four VAT Rates
France applies four rates, and which one shows up on a receipt depends entirely on what’s being sold.1European Commission. VAT Rates Applied in the European Union
- 20% is the standard rate. It covers most goods and services, including electronics, clothing, furniture, and professional services not assigned to a lower rate.
- 10% applies to hotel stays, restaurant meals (excluding alcoholic drinks), passenger transport, unprocessed agricultural products, admission to cultural events and amusement parks, and certain non-reimbursable medicines.
- 5.5% covers essentials: most food products, books, gas and electricity subscriptions, water supply, medical equipment for people with disabilities, home energy-efficiency renovations, and school cafeteria meals.
- 2.1% is reserved for a narrow set of items, including medicines reimbursable by French social security, certain press publications, and the television license fee.
A handful of transactions are zero-rated at 0%, such as intra-EU and international transport of goods. Zero-rating is not the same as exemption. A business making zero-rated sales can still recover the VAT it paid on its own purchases; a business making only exempt sales generally cannot.
What’s Exempt
Some activities sit outside the VAT system altogether. The seller charges no VAT, but the trade-off matters: the seller also cannot recover input VAT on costs tied to those exempt activities, so that VAT becomes a hidden expense that often ends up baked into the price.
The main exemptions in France mirror the EU VAT Directive:
- Financial services, including loans, credit, currency exchange, and securities trading
- Insurance and reinsurance policies, plus related brokerage
- Medical and paramedical services provided by recognized professionals
- Teaching and vocational training by recognized institutions
- Leasing of unfurnished residential property
- Certain activities by qualifying non-profit organizations
- Betting and lottery operations
Businesses that straddle both taxable and exempt activities can only deduct input VAT in proportion to their taxable revenue, which turns into a partial recovery calculation that gets complicated fast.
Corsica and the Overseas Departments
Corsica uses the same 20% standard rate as the mainland but has several derogations. Construction work there generally falls under the 10% rate. A special 0.90% rate applies to items like sales of live animals for slaughter, and a 13% rate applies to certain petroleum products. These reflect longstanding policies aimed at offsetting the island’s higher cost of living.
The French overseas departments — Guadeloupe, Martinique, Réunion, French Guiana, and Mayotte — sit outside the EU VAT Directive entirely. They operate under a separate tax called octroi de mer (dock dues), with rates set by regional councils.2Douanes (French Customs). Customs Taxation in the Overseas Departments For VAT purposes they behave as separate jurisdictions, not extensions of mainland France.
Getting a VAT Refund as a Non-EU Visitor
If you’re visiting from outside the EU, you can reclaim some of the VAT paid on purchases you take home. On goods taxed at 20%, the savings on larger purchases can be meaningful, though a refund operator’s fee is deducted before you see the money.
To qualify, you need to be a non-EU resident aged 16 or older, in France for fewer than six months. You must spend at least €100 including VAT in a single participating store on the same day (look for a “Tax Free” sign). The goods have to leave the EU with you, and you have to export them before the end of the third month after the month of purchase.3Douanes (French Customs). VAT Refund Process in France – PABLO Barcode Reader
At the store, ask for a bordereau de détaxe (export sales form). When leaving the EU through a French airport or border crossing, validate the form at a PABLO electronic kiosk before checking your luggage. The process takes about a minute: pick your language on the touchscreen, scan the barcode on your form, and wait for the green confirmation. That electronic approval replaces the old paper customs stamp.3Douanes (French Customs). VAT Refund Process in France – PABLO Barcode Reader
After validation, your refund comes either at a reimbursement window at the airport, if one is available, or by bank transfer, depending on the option you chose when you bought the goods. If no PABLO kiosk is available at your departure point, find a customs officer to stamp the form manually.
Who Has to Register for VAT
Anyone independently carrying out an economic activity on a regular basis counts as a “taxable person” under French law.4European Commission. Taxable Persons Under EU VAT Rules That includes sole traders, companies, professionals, and freelancers. Employees under a contract of employment are not taxable persons for VAT purposes.
The Small Business Exemption
France’s franchise en base regime exempts small businesses from charging or filing VAT, as long as annual turnover stays below set limits. As reinstated by legislation in late 2025, the thresholds are:
- €85,000 for sales of goods and accommodations
- €37,500 for services
A business under this regime cannot charge VAT to customers and cannot deduct input VAT on its purchases. Once turnover crosses the relevant threshold, the business has to register, start charging VAT, and file returns. That transition changes pricing overnight, because customers either see a 20% markup or the business absorbs it.
Foreign Businesses
A foreign company without a permanent establishment in France has to register for French VAT if it makes taxable supplies to French individuals or to businesses that aren’t VAT-registered in France. Where the French customer is VAT-registered and can apply the reverse charge, the foreign supplier usually has no obligation to register.5French Tax Authority. Do Foreign Companies Have to Register for VAT
For online sellers shipping to French consumers from elsewhere in the EU, a €10,000 annual threshold applies across all EU distance sales combined. Below it, a seller can keep charging home-country VAT. Above it, VAT has to be charged at the customer’s country’s rate, and the One Stop Shop (OSS) lets the seller register in one member state and file a single return for all EU distance sales.6European Commission. VAT e-Commerce – One Stop Shop
Filing Regimes
France has two main filing regimes. Under the régime réel normal, businesses file monthly VAT returns. Those with modest liabilities (under €4,000 for the previous four quarters combined) can opt for quarterly filing instead. This regime applies to businesses with turnover above €818,000 for goods or €247,000 for services, or whose VAT liability topped €15,000 the prior year.
Under the régime réel simplifié, businesses make two advance payments during the year (in July and December) and file an annual reconciliation return. This regime covers businesses above the franchise en base thresholds but below the normal regime ceilings.
When a return shows more input VAT than output VAT, the business can claim a refund. Monthly and quarterly filers must meet a minimum claim of €760; annual filers face a lower minimum of €150.7French Tax Authority. When Do I Have to File My Claim
Penalties for Late Filing or Payment
Missing a VAT deadline in France gets expensive quickly. A late return triggers a penalty starting at 10% of the VAT due. If the return still isn’t filed after a formal reminder from the tax authorities, that penalty jumps to 40%. Late payment carries a separate 5% surcharge on the unpaid amount, plus interest at 0.20% per month. These stack, so a business that both files late and pays late faces the filing penalty, the payment surcharge, and the monthly interest all at once.