France | Tax Authorities Scrap Seasonal VAT Returns

The French tax authorities have recently indicated they are phasing out use of the Saisonnier (seasonal) regime. Under this regime, businesses that are involved in “seasonal activity” have only been required to file VAT returns in the periods for which they have activity to report.

The regime is intended to apply to businesses that are active for only a few months of the year (for example, during the summer), and remain shut the rest of the time.

In practice however, seasonal VAT registration status has also been granted to businesses performing activities on an “occasional” or “random” basis. As a result, according to our recent communication with the French tax office, there has been a shift in policy relating to VAT return filing for such tax payers.  This change is that seasonal VAT registrations are no longer being issued to new taxpayers.  Instead, new taxpayers indicating that they have such activity when applying for a VAT number are by default going to be asked to file quarterly VAT returns as from the start of their business activities.

For now, existing seasonally-registered businesses may continue to file monthly VAT returns as and when they have activity to report.  But going forward, the tax authorities will contact them individually and alert them to the date from which they are obligated to switch to submitting regular periodic returns.

It should be noted that in France, if the total annual VAT payments due exceed the threshold of €4,000, the taxpayer will no longer file quarterly returns.  Instead, monthly filing is required.

We expect the French tax authorities to issue an official statement on this change in the coming months.

Businesses such as event planners and organisers are likely to be particularly impacted by this change.  If you would like further advice on how your business may be affected, please do get in touch to discuss how we can help.