COVID-19: the French Government takes a favorable measure for businesses in a VAT credit position

In a press release dated March 22, 2020, the French Ministry announced an accelerated reimbursement of VAT refund claims in order to help businesses during this difficult period.

This acceleration of the process applicable to VAT refund claims will be facilitated and made possible in particular by increasing the delegation of signature threshold provided for in article 214 of annex IV to the French tax code up to € 500,000.

This extended delegation is provided for in a decree of March 18, 2020 published in the official journal of March 22, 2020 and is granted until the end of the second month following the end of the measures to limit travels and prohibit assembly or certain activities…

This measure will therefore allow the tax Authorities to be able to take decisions concerning VAT refund requests for an amount below € 500,000 more quickly.

In practice, the VAT refund claims are first studied by the local tax center in charge of the business and are then sent for final study to the competent Direction when the VAT refund claims exceed € 100,000. This process generates de facto an extension of the deadlines before the final decision and reimbursement are made. Nowadays and for a limited period of time as above explained, only VAT refund claims exceeding € 500 000 will be subject to this long process.

WARNING : in order to benefit from this specific measure, companies should submit their VAT refund claims and the related VAT returns on time! Indeed, according to our experience, a VAT refund claim filed after the deadline is generally rejected for non-compliance.</p

Vanessa Irigoyen

Vanessa has joined Deloitte France in 2002 and she is the partner leading the French indirect Tax Practice. For more than 18 years, she advises multinational companies on their global […]