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France Introduces VAT Grouping Regime

From January 1, 2023, France will introduce a new value-added tax group regime.

Article 11 of the VAT law provides the option to establish a VAT group for taxpayers established in France or French permanent establishments that are, while legally independent, closely bound to one another by economic, financial, and organizational links.

Applications were required by October 31, 2022 to establish a new VAT group for next year.

Multinationals typically form VAT groups to simplify administration of VAT within a group and to benefit from transactions between individual members being outside the scope of VAT.

Forming a VAT group also speeds VAT recovery, as input tax credit can immediately be set off against the output tax liability of another group member, rather than having to apply and wait for a VAT refund.


If you require assistance in relation to the above and/or would like to discuss anything further, please do not hesitate to contact or your usual A.C.T. contact.


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