In principle, VAT is not concerned by the measures officially implemented by the French government. However, since VAT can have a cash impact for the companies, case-by-case approaches can be used for VAT purposes :
- Payment schedule for the VAT due for a period. It is possible to request a payment schedule to request the postponement of the due dates of February, March and April (at this stage), without application of late interest and penalties.
- Postponement of VAT payments for the VAT due on invoices issued (deliveries of goods or services with taxable person having opted for payment of VAT on an accrual basis) but not collected by the taxable person.
- Payment of a flat-rate amount of VAT for the months of March 2020 and April 2020 (in the event of a prolongation of the confinement making it impossible to declare a regularization on that date):
- 80% of the VAT for month M-1 (February or March), or, if the company has already made use of an advance payment the previous month, 80% of the amount declared for month M-2 (January or February). This measure concerns companies which are still in business but which are experiencing difficulties in preparing their returns;
- 50% of the VAT for the previous month (February or March), or, if the business has already made use of a deposit the previous month, 50% of the amount declared for month M-2 (January or February). This measure concerns businesses whose activity has been discontinued since mid-March (total closure) or is in very sharp decline (estimated at 50% or more).
For information, a return of regularization will have to be filed at the end of the containment. This will include the actual elements drawn from the activity of the months for which a down payment was paid, after deduction of these amounts.
- Option to perform an estimation of the VAT due for a month and to pay, within the time limit of the filing of the VAT return, a down payment corresponding to this amount. A margin of error of 20% of the amount actually due is tolerated (BOI-TVA-DECLA-20-20-10-10 n°260).
Based on the first feedback received, the implementation of measures 1 and 2 must be requested in writing through the administrative account portal used for the filing of VAT returns.
Regarding measures 3 and 4, they may therefore be applied by companies and will be subject to a posteriori controls by the tax authorities.
Finally, with regard to VAT refund claims, Gérald Darmanin, Minister of Action and Public Accounts, announced in a press release the possibility of requesting accelerated processing of VAT refund claims by the French Tax authorities (Press Release no. 996, dated March 22, 2020), when they have been correctly completed and do not raise any additional questions from the tax authorities.
Contribution by Nathalie Habibou, Partner and Audrey Vivaldi, Manager – Arsene Taxand
