Understanding VAT accounting obligations in France

Keeping an accounting or a special book

General case

VAT payers must keep accounts to justify the nature and amount of all their transactions. This accounting should make it possible to fill in transaction declarations by distinguishing between supplies of goods, services, real estate works, self-deliveries, exports and other non-taxable transactions.

Any taxable person who does not have accounts capable of determining his turnover must keep a special book. This book, whose pages are numbered by the taxable person, must include the daily entry of each transaction, without blanks or deletions, distinguishing taxable transactions from those that are not taxable. Each entry must include the date, description of the transaction and its price. The total transactions are carried out at the end of each month.

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Specific cases of certain incomes

Property renters must keep a journal book with numbered pages. It traces the amount of each transaction on a daily basis, specifying the amount excluding tax, VAT and its rate, as well as the name and address of the customer or supplier. Supporting documentation must support these registrations.

Holders of non-commercial income subject to a real VAT regime must keep a book-journal of receipts and expenses that includes the information required for VAT. Arrangements exist concerning the identity of the client for professions subject to professional secrecy. If ancillary commercial income is received, the revenue must be broken down by nature.

For some professions, specific obligations are added:

• Veterinarians need to be able to distinguish between taxable and non-taxable transactions.
• Propharmacist doctors should break down drug sales from medical fees.
• Auctioneers must adapt their professional journal-book.
• Lawyers, authors and artists benefiting from the franchise in base can keep simplified accounts consisting of a register of purchases.

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Mandatory information in accounting

Principles

The accounting or special book must show separately the transactions not subject to VAT and those carried out without tax. For each purchase, the amount, the corresponding VAT and the contact details of the supplier must be indicated. Likewise, for each transaction invoiced with VAT, the net amount, the VAT due and the customer's contact details must appear.

It is possible for some taxpayers to record their revenue including all taxes (TTC) and to reconstitute the amount excluding tax (HT) using conversion coefficients.

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Special provisions

The acquisitions to be recorded concern all the goods and services necessary for the business, whether expenses or fixed assets. Capital goods are to be recorded for their price minus deductible VAT.

For real estate services provided to individuals, a note detailing the operation, the parts, the price and VAT is mandatory.

For cash transactions, those with a unit amount of less than €76 including VAT corresponding to retail sales and services to individuals can be registered globally at the end of the day. This rule is assessed per transaction and not per item sold. The taxable person must keep all supporting documents, such as cash registers, for these global records. Even in the case of global registration, the company must be in a position to provide all the justifications necessary to determine taxable transactions.

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Records relating to e-commerce transactions

Obligations for users of single windows (OSS and IOSS)

Taxpayers who use special one-stop shops (“OSS non-EU”, “OSS EU” and “IOSS”) to declare and pay VAT on their e-commerce transactions are required to maintain a detailed record of these transactions. This register should allow the administration to verify the correct application of VAT.

These records must be kept for a period of ten years. They must be made available to the administration electronically and without delay on simple request. A failure to comply with this obligation may result in the cancellation of the scheme concerned.

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Obligations for electronic interfaces

A taxable person who facilitates the supply of goods or services to a non-taxable person via an electronic interface must also keep a record of these transactions.

If the interface is not considered to be a purchaser-dealer for VAT purposes, the register should contain information identifying the supplier as well as the goods or services.

If the interface is deemed to have personally acquired and provided the good or service, thus becoming liable for VAT, its record-keeping obligations depend on its method of declaration. If it uses one of the special regimes (OSS or IOSS), the obligations are those applicable to these regimes. Otherwise, it is subject to traditional accounting requirements.

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Detailed contents of the registers

For transactions declared via the EU OSS and non-EU OSS regimes, the register must contain in particular: the Member State of consumption, the type of service or description of the goods, the date of the transaction, the tax base, the VAT rate applied and the amount of tax due, the amount of tax due, the date and the amount of tax due, the date and amount of payments, the date and amount of payments, the information of the invoice if issued, and the elements proving the location of the customer or the journey of the goods.

For transactions reported via the IOSS regime, the register must include similar information, supplemented by the unique order or transaction number and the unique shipment number if the taxable person is involved in the delivery.

For the facilitating taxable person who is not deemed to be a purchaser-reseller, the register must include the name, address and fiscal and bank identifiers of the supplier, as well as a description of the goods or services, their value, and the place and time of delivery or service.

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Breakdown of transactions by tax rate

There is a standard VAT rate, as well as reduced rates for certain designated transactions and specific rates applicable to certain goods or in certain departments.

VAT payers are required to justify the details of their transactions, both in terms of their nature and the amount of revenue. Therefore, companies that market products subject to different VAT rates must distribute their revenues by category of transactions and by tax rate in their accounting. Their sales and accounting methods should be designed to meet this breakdown requirement.

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Description of authorized ventilation methods

Three main ventilation methods are planned. They all require accurate accounting of purchases.

• Method A : This method consists in accounting for purchases at the purchase price. The overall revenue is then broken down in the same proportion as purchases including VAT. It can only be accepted if the commercial margins of the various product categories are very similar. An annual adjustment is mandatory to take into account the margins actually applied and the variations in stocks if they exceed 10 points.
• Method B : With this method, purchases are recorded at theoretical sales value. This value is obtained by applying a weighted average trade margin to product categories. An annual adjustment must be made if the variation in stocks by product category exceeds 10 points. ‍
• Method C : This method is a more accurate variant of method B. The theoretical sales value is obtained by applying its own commercial margin to each product. The annual adjustment for changes in stocks applies under the same conditions as for method B.

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Other methods and formalities

A company may request permission to use a different distribution method that is better suited to its situation, provided that it respects the general principles and provides results that are close to reality.

The use of methods A, B or C requires prior declaration to the tax service. For methods A and B, justifications on commercial margins must be attached. A custom method requires prior authorization. Any changes in business practices that impact data should be reported.

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‍Use of secure cash register software or systems

A VAT taxable person who records the payments of his individual customers using software or a cash register system is required to use equipment that meets conditions of inalterability, security, preservation and archiving of data. This provision does not create an obligation to equip yourself with such a system.

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Scope of the obligation

This applies to taxable persons who carry out transactions with individual customers and who use cash register software or system, defined as a computer system recording payments in an extra-accounting manner. Transactions between professionals (B to B) are excluded.

Taxable persons benefiting from the VAT exemption or carrying out exclusively exempt transactions are not subject to this obligation. Likewise, there is a tolerance for taxable persons whose entire payments transact through the direct intermediation of a specific credit institution with which the administration can exercise its right of communication.

The obligation covers all the detailed data for each transaction, such as the date, the amount, the details of the items, the method of payment and the traces of changes.

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The four conditions that must be met

The cash register software or system must guarantee four conditions.

• Inalterability : The original recorded data cannot be changed. Any correction must be the subject of a new “plus” or “minus” operation, leaving a record of the change.
• Securing : The recorded data must be secured, for example via a chaining technique or electronic signature, in order to guarantee their return in their original condition.
• Conservation : All detailed data must be retained for a period of six years. The system should provide for mandatory closings (daily, monthly, annual) and calculate cumulative totals that should never be purged.
• ‍Archiving : The system must make it possible to create fixed, dated and integrated archives of data on an external medium and in a format readable by the administration.

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Justification of conformity

The conformity of the cash register software or system must be proved by the production of a certificate issued by an accredited organization. It is the responsibility of the software publisher to obtain this certification and to provide it to the user.

A transitional period is put in place following the abolition of the publisher's individual certificate as a form of proof:

• Until August 31, 2025 : The publisher's certificate remains accepted as justification.
• From September 1, 2025 to February 28, 2026 : The software must either be certified or have been the subject of a certification request initiated by its publisher.
• As of March 1, 2026 : Only the certificate issued by an accredited organization will be accepted as proof of compliance.

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Penalties

Failure to provide evidence of compliance with this obligation is punishable by a fine. Producing a false certificate is a criminal offence.

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