Exemption based on VAT
Verified 04 November 2025 - Public Service / Directorate of Legal and Administrative Information (Prime Minister), Ministry of Finance
The VAT exemption is a system that exempts companies from the declaration and payment of VAT on the services or sales they make. This tax regime is applicable to all companies established in France or another EU Member State whose turnover (turnover) for the previous year does not exceed certain thresholds.
Company established in France
The exemption from VAT relieves tax obligations: under this system, there is no VAT declaration to be made. In return, it is not possible to deduct VAT on business purchases made for the needs of the activity.
In order to benefit from the VAT exemption scheme, the company's turnover must not exceed certain thresholds.
These thresholds vary according to the activity carried out.
Please note
A single exemption threshold based on VAT of €25,000 was envisaged by the 2025 budget law. This threshold, whose application had remained suspended, was finally abandoned by the law no. 2025-1044 of november 3, 2025. The VAT-based exemption thresholds therefore remained unchanged.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Commercial and hosting activity
In order to benefit from the VAT exemption, the company must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €85,000.
- The turnover of the current calendar year (N) is less than or equal to €93,500.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company has just started its business, it must adjust its turnover for the year of creation in proportion to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €82,000 in 2024. The turnover threshold not to be exceeded is €85,000, it can therefore benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €90,500. The tolerance threshold not to be exceeded in 2025 is €93,500. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€85,000), but it remains below the tolerance threshold of €93,500. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
Prorate when starting the activity
In the case of a company's start-up year, its turnover must be adjusted and calculated in proportion to its operating time (between the start-up date and the last day of the year) in order to obtain a turnover for a full year (VAT thresholds are calculated only for a full year).
The formula is as follows:
(CA / number of days in a year ) x number of days between start and last day of year.
This calculation makes it possible to determine whether the company can continue to benefit from the exemption from VAT in the following year.
Example :
If the company starts its activity on May 14, 2024 and had a turnover of €82,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. Thus, for the year 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in a year and divided by the number of days between the date of creation of the company and the end of the year: (€82,000 x 365)/232 = €129,009.
The company’s turnover calculated on a pro rata basis is greater than €93,500. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Service Delivery Activity
In order to benefit from the VAT exemption, she must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €37,500.
- The turnover of the current calendar year (N) is less than or equal to €41,250.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day
If the company comes from start your business, it must adjust its turnover for the year of creation in proportion to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €24,000 in 2024. The basic turnover threshold not to be exceeded is €37,500 thus, it can benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €38,500. The tolerance threshold not to be exceeded in 2025 is €41,250. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€37,500 ) but it remains below the tolerance threshold €41,250. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €27,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€27,000 x 365)/232 = €42,478.
The company’s turnover calculated on a pro rata basis is greater than €41,250. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Professional activity (except lawyer)
In order to benefit from the VAT exemption, the company must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €37,500
- The turnover of the current calendar year (N) is less than or equal to €41,250.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €24,000 in 2024. The basic turnover threshold not to be exceeded is €37,500 thus, it can benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €38,500. The tolerance threshold not to be exceeded in 2025 is €41,250. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€37,500 ) but it remains below the tolerance threshold €41,250. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €27,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€27,000 x 365)/232 = €42,478.
The company’s turnover calculated on a pro rata basis is greater than €41,250. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Lawyer
The profession of lawyer is a regulated profession. So there are specific conditions of access and exercise. Most of the activities of the lawyer are regulated (postulation, pleadings, consultations, drafting of legal acts). It may also carry out ancillary activities that are not regulated (e.g. courses in training centers).
The VAT exemption thresholds differ whether the activity is regulated or not. It is important to keep accounts showing the different categories of revenue in order to identify the turnover generated by each category.
For regulated activities
In order to benefit from the VAT exemption, the company must be in one of the following situations:
- The turnover of thecalendar year previous (N-1) less than or equal to €50,000
- The turnover of the current calendar year (N) is less than or equal to €55,000.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
For non-regulated activities
In order to benefit from the VAT exemption, she must be in one of the following situations:
- The turnover of the previous calendar year (N-1) is less than or equal to €35,000.
- The turnover of the current calendar year (N) is less than or equal to €38,500. If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
The company has a turnover of €13,000 for its regulated activities in 2024. The basic turnover threshold not to be exceeded is €35,000. Thus, it can benefit from the exemption on the basis of VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €13,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€13,000 x 365)/232 = €20,453.
The company's pro-rated turnover is less than €35,000Thus, it can benefit from the exemption based on VAT in 2025.
Author of a work of the mind or performer (and his successors in title)
The author of a work of the mind or the performer may have different types of income. The thresholds for the basic exemption are different in the case of activities involving the supply of works and the assignment of copyright or other activities.
It is important to keep an accounting showing the different categories of income in order to identify the turnover generated by each category.
For the activities of delivery of works and assignment of copyright:
In order to benefit from the VAT exemption, one of the following situations must be present:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €50,000.
- The turnover of the current calendar year (N) is less than or equal to €55,000.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
For other activities:
In order to benefit from the VAT exemption, one of the following situations must be present:
- The turnover of the previous calendar year (N-1) is less than or equal to €35,000.
- The turnover of the current calendar year (N) is less than or equal to €38,500.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
The company has a turnover of €13,000 for its regulated activities in 2024. The basic turnover threshold not to be exceeded is €35,000Thus, it can benefit from the exemption on the basis of VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €13,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 had to be calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€13,000 x 365)/232 = €20,453.
The company’s pro rata turnover is less than €35,000Thus, it can benefit from the exemption based on VAT in 2025.
Definition of a taxable person for VAT purposes established in France or in the EU
VAT-based exemption thresholds
The exemption from VAT is applicable to sales and services where the company does not exceed certain turnover thresholds. However, there are a few transactions in which the VAT exemption does not apply.
These operations are as follows:
- Real estate transaction for the purpose of producing or delivering buildings (this does not apply to real estate works)
- Real estate operation with the aim of delivering to oneself renovation works of rental dwellings renovated by landlords (this does not concern real estate works)
- Transaction carried out by a farmer or a landlord of rural property who has opted for his transactions to be subject to VAT
- Transaction subject to VAT due to an option or authorization (removal and treatment of waste, transaction related to a banking activity, etc.
- Intra-Community delivery of new means of transport.
Transactions excluded from the VAT exemption
The consequences of the VAT exemption are different depending on whether trade takes place in France, within or outside the EUEuropean Union.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Exchanges in France
As a professional who falls under the franchise on a french basis, the company must invoice its services or sales made in France without VAT, in other words excluding tax (HT).
The mention VAT not applicable - Article 293 B of CGI: titleContent must appear on every invoice or bill of fees. If this statement is not indicated, the company is liable to a tax adjustment for non-compliance with the administrative formality in the event of a tax inspection.
By benefiting from the VAT exemption system, the company is exempt from monthly or quarterly French VAT declarations.
On the other hand, it cannot deduct VAT from its purchases (goods or services) made in the course of its professional activity. To be able deduct VAT on its professional purchases, the company must opt for the actual VAT system.
Mandatory mention - VAT not applicable
Trade in the European Union
Prior notification to administration
As a company established in France, it is possible to apply to benefit from the VAT exemption system in one or more European Union countries.
To do this, we must address a prior notification to the French administration. Such prior notification shall include the following information:
- Name, activity, legal form, postal and e-mail addresses
- Individual identification numbers in each EU Member State
- The Member State(s) of the European Union (EU) in which the trader intends to make use of the franchise
- The total amount of supplies of goods or services made in France and in each of the other EU Member States since 1 January of the current year, in the previous calendar year and in the penultimate calendar year.
This prior notification must be update in case of change of this information. For example, to benefit from the exemption in a State not mentioned in the prior notification or vice versa, to stop applying the exemption scheme in one or more of those Member States.
The French administration communicates to the company its individual identification number for the duty-free regime within 35 days which follow receipt of the prior notification or its update, except in specific cases (such as a suspicion of fraud or tax evasion requiring an extension of this period).
Declarations of exchanges to the administration
A company which is exempt from VAT in another Member State of the European Union must carry out a declaration containing the following information:
- Individual identification number for the duty-free scheme
- Total amount of sales of goods and services made in France during the calendar quarter. If no sale or service has been made in France it must be indicated 0
- Total amount of sales of goods and services made in each EU Member State during the calendar quarter. If no sale or service has been made in one of these States, please indicate 0.
Sales made in a Member State where the company does not benefit from the VAT exemption must also be indicated.
This information must be transmitted to the French administration in the delay of 1 month from the end of the calendar quarter.
FYI
When the taxable trader does not respect this 1-month period from the end of the calendar quarter, he must identify himself for VAT in France and file VAT returns there.
Consequences of the VAT-based exemption system
In case of sale within the European Union, the company does not charge VAT to its customers (professionals or individuals).
When it makes purchases of goods, the methods of invoicing and collecting VAT depend on the total amount of intra-Community acquisitions made by the French company:
- Where the total amount of its intra-Community acquisitions has not exceeded the €10,000 HT: titleContent in the previous year or since the beginning of the current year: the seller invoices in TTC: titleContent, at the rate of VAT in force in his State. The purchaser, who is therefore treated as an individual, cannot deduct this VAT.
- Where the total amount of its intra-Community acquisitions has exceeded the threshold of €10,000 HT: titleContent in the previous year or since the beginning of the current year: the seller must establish a invoice without VAT, i.e. in excluding tax (excl.. The company established in France which has carried out this intra-Community acquisition must then itself assess the VAT in France at french rate.
This reverse charge of VAT obliges the company to request a Intra-Community VAT number with the SIE: titleContent. This request must be made as soon as it becomes aware that the €10,000 .
FYI
To draw up an invoice in HT: titleContent in the event of the threshold of €10,000 , the seller located in a Member State ofEuropean Union will need the VAT number of the client company. This number can be freely calculated or verified on the platform LIVES. The seller will also need it to justify, in his state, that he does not have to collect VAT. It is paid directly in France, by the French client company.
On the other hand, when a company established in France buys services provided, it must pay VATregardless of the amount of these benefits.
As the company is subject to the exemption system on the basis of VAT, it cannot deduct VAT on its purchases. To be able deduct VAT on her professional purchases, she must opt for the actual VAT system.
Loss of exemption for intra-Community trade
The French company loses the benefit of the exemption from VAT for its intra-Community trade when its Annual turnover (turnover) in the European Union (not in France) exceeds €100,000. In such a situation, the company has 15 days to inform its SIE: titleContent. It shall also provide the following information:
- The total amount of sales of goods and services made in France between the beginning of the current calendar quarter and the date of overrun.
- The total amount of sales of goods and services made in each Member State of the European Union between the beginning of the current calendar quarter and the date of overrun. Sales concluded in a Member State where the company does not benefit from the VAT exemption must also be indicated.
Once this information has been transmitted, the French administration disables the company identification number.
The company must also inform the administration and modify its prior declaration in the following situations:
- The Member State in which it benefits from the exemption has notified it that it can no longer benefit from the exemption or that the exemption no longer applies in that State.
- It wishes to opt out of the VAT exemption system.
- It has ceased its activities.
For more information, you can consult our factsheet on the VAT applicable to trade in goods in the European Union.
Prior notification of the use of the franchise within the EU by a company established in France
Trade outside the European Union
As a professional who realizes exports, the company does not invoice not VAT whether it is exempt from VAT or not.
When it carries out imports, it must pay VAT whether or not it is exempt from VAT. On the other hand, it cannot deduct the VAT it has paid on its imports, duty-free on the basis of VAT. To be able deduct VAT on her professional purchases, she must waive the deductible based on VAT.
For more information on VAT applicable to imports and exports, you can consult the corresponding sheet.
FYI
We have to be vigilant about mandatory details of invoices that the company emits and receives. Any non-compliant invoice poses a risk of penalty to the company in the event of a tax inspection.
A company that complies with the turnover thresholds (turnover) to benefit from the VAT exemption scheme possibility to opt to be subject to VAT.
Under the VAT exemption system, the company is not able to deduct the VAT paid on its business purchases and acquisitions. The option to pay VAT may be advantageous for those considering, for example, making investments.
The option to pay VAT must be made in writing to the tax office (SIE) of the company's headquarters.
The option takes effect immediately on 1er day of the month in which it is declared.
It is valid for a period of 2 calendar years and is tacit renewal.
For give up at the option, the company must report it after a period of 2 years. On the other hand, if she has received a VAT credit refund, the option will be renewed for 2 years and she will not be able to renounce it during these 2 years.
The option must be taken from the company Tax Office (SIE) on which the company depends:
Online tax account for professionals (EFI mode)
Example :
A company opts to be subject to VAT on July 4, 2024. It will then be subject to the VAT of 1er July 2024 to December 31, 2025.
Option for VAT
When the company exceeds certain turnover thresholds (turnover), it can no longer benefit from the exemption system on the basis of VAT. These turnover thresholds depend on the activity carried out:
Répondez aux questions successives et les réponses s’afficheront automatiquement
Commercial and hosting activity
Since 1er January 2025, when turnover exceeds base threshold of €85,000, the company is subject to VAT from 1er January of the following year.
But if the 2025 turnover exceeds tolerance threshold of €93,500, the exemption from VAT shall cease to apply from 1er overshoot day (and no longer on the first day of the month of the exceedance).
FYI
When the turnover achieved in 2024 exceeded €85,000, the system of exemption on the basis of VAT shall cease to apply from 1er January 2025.
Service Delivery Activity
When the turnover exceeds base threshold of €37,500, the company is subject to VAT from 1er January of the following year.
But if the 2025 turnover exceeds tolerance threshold of €41,250, the exemption from VAT shall cease to apply from 1er overshoot day (and no longer on the first day of the month of the exceedance).
FYI
When the turnover achieved in 2024 exceeded €37,500, the system of exemption on the basis of VAT shall cease to apply from 1er January 2025.
Professional activity (except lawyer)
If the basic threshold of €37,500, the company is subject to VAT from 1er January of the following year.
If the turnover exceeds tolerance threshold of €41,250, the company may no longer benefit from the exemption from VAT system from 1er day of overrun month (and no longer on the first day of the month of the overshoot).
VAT thresholds
Lawyers
When the turnover that the company realizes for its regulated activities exceeds the threshold of €50,000, it may no longer benefit from the exemption on the basis of VAT from 1er January of the following year. On the other hand, if its turnover exceeds the tolerance threshold of €55,000, it may no longer benefit from the exemption system on the basis of VAT as from 1er overrun day.
Exceeding the turnover threshold for its unregulated activities of lawyers (e.g. management and administration of goods, debt collection) does not affect the application of the VAT exemption regime on its regulated activities.
VAT thresholds
Authors of works of the mind and performers
When the company generates a turnover for the activities of delivery of your works (authors) and assignment of your rights (performers) that exceeds the threshold of €50,000However, it can no longer benefit from the exemption on the basis of VAT the following year. On the other hand, if its turnover exceeds the tolerance threshold of €55,000, it may no longer benefit from the exemption system on the basis of VAT as from 1er overrun day.
Exceeding the turnover threshold for other activities does not affect the application of the exemption from VAT regime for the supply of its works (authors) and the transfer of its rights (performers).
VAT thresholds
The exit from the scheme of the exemption on the basis of VAT entails the following effects:
- Submission of transactions to VAT from 1er overshoot day. Thus it must charge VAT to its customers. Invoices issued from this date must indicate the amount of VAT that has been invoiced to customers.
- The company is now entitled to deduction of VAT on his professional purchases. It may ask the tax authorities to deduct the VAT paid on its business purchases at the time of its VAT declaration of 1er month overrun.
- The company must apply for Intra-Community VAT number and indicate it on his invoices. To obtain her VAT number, she must contact, via her business account on the website impots.gouv.fr, the company tax department (SIE) on which she depends. It must inform the Member State that it has left the VAT exemption system:
Company established in Europe (excluding France)
THE COMPANY established outside France in a Member State of the European Union may benefit from the exemption on the basis of VAT for the operations it carries out in France if it meets the following conditions:
- Have a turnover on the territory of the European Union less than or equal to €100,000 the previous year and the current year
- Notify the Member State in which it is established of its intention to make use of the franchise in France through a prior notification (or an update of the first notification).
- Respect the french thresholds the exemption on the basis of VAT. These thresholds are different depending on the activity carried out.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Commercial and hosting activity
To benefit from the exemption from VAT in France, the company must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €85,000
- The turnover of the current calendar year (N) is less than or equal to €93,500.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company has just started its business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €82,000 in 2024. The turnover threshold not to be exceeded is €85,000, it can therefore benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €95,500. The tolerance threshold not to be exceeded in 2025 is €93,500. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€85,000), but it remains below the tolerance threshold of €93,500. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €82,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. Thus, for the year 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in a year and divided by the number of days between the date of creation of the company and the end of the year: (€82,000 x 365)/232 = €129,009.
The company’s turnover calculated on a pro rata basis is greater than €93,500. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Service Delivery Activity
To benefit from the exemption based on VAT in France, she must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €37,500
- The turnover of the current calendar year (N) is less than or equal to €41,250.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €24,000 in 2024. The basic turnover threshold not to be exceeded is €37,500 thus, it can benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €38,500. The tolerance threshold not to be exceeded in 2025 is €41,250. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€37,500 ) but it remains below the tolerance threshold €41,250. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €27,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€27,000 x 365)/232 = €42,478.
The company’s turnover calculated on a pro rata basis is greater than €41,250. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Professional activity (except lawyer)
To benefit from the exemption from VAT in France, the company must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €37,500.
- The turnover of the current calendar year (N) is less than or equal to €41,250.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
A company has a turnover of €24,000 in 2024. The basic turnover threshold not to be exceeded is €37,500 thus, it can benefit from the exemption on the basis of VAT.
The following year, it achieved a turnover of €38,500. The tolerance threshold not to be exceeded in 2025 is €41,250. For the year 2025, it exceeds the basic threshold of the exemption based on VAT (€37,500 ) but it remains below the tolerance threshold €41,250. As its turnover in the previous year was below the basic threshold, the company continues to benefit from the exemption from VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €27,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€27,000 x 365)/232 = €42,478.
The company’s turnover calculated on a pro rata basis is greater than €41,250. Thus, it cannot benefit from the exemption from VAT for the year 2025.
Lawyer
The profession of lawyer is a regulated profession. So there are specific conditions of access and exercise. Most of the activities of the lawyer are regulated (postulation, pleadings, consultations, drafting of legal acts). It may also carry out ancillary activities that are not regulated (e.g. courses in training centers).
The VAT exemption thresholds differ whether the activity is regulated or not. It is important to keep accounts showing the different categories of revenue in order to identify the turnover generated by each category.
For regulated activities
To benefit from the exemption from VAT in France, the company must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €50,000.
- The turnover of the current calendar year (N) is less than or equal to €55,000.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
For non-regulated activities
To benefit from the exemption based on VAT in France, she must be in one of the following situations:
- The turnover of the previous calendar year (N-1) is less than or equal to €35,000.
- Your current calendar year (N) revenue is less than or equal to €38,500.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
The company has a turnover of €13,000 for its regulated activities in 2024. The basic turnover threshold not to be exceeded is €35,000. Thus, it can benefit from the exemption on the basis of VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €13,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 should have been calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€13,000 x 365)/232 = €20,453.
The company’s pro rata turnover is less than €35,000Thus, it can benefit from the exemption based on VAT in 2025.
Author of a work of the mind or performer (and his successors in title)
The author of a work of the mind or the performer may have different types of income. The thresholds for the basic exemption are different in the case of activities involving the supply of works and the assignment of copyright or other activities.
It is important to keep an accounting showing the different categories of income in order to identify the turnover generated by each category.
For the activities of delivery of works and assignment of copyright:
To benefit from the exemption based on VAT in France, you must be in one of the following situations:
- The turnover of thecalendar year preceding (N−1) is less than or equal to €50,000.
- The turnover of the current calendar year (N) is less than or equal to €55,000.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
For other activities:
In order to benefit from the VAT exemption, one of the following situations must be present:
- The turnover of the previous calendar year (N-1) is less than or equal to €35,000.
- The turnover of the current calendar year (N) is less than or equal to €38,500.
If the company exceeds the threshold, it is subject to VAT on 1er overrun day.
If the company comes from start your business, it must adjust its turnover for the year of creation according to its operating time to determine whether it can benefit from the exemption on the basis of VAT in the following year.
Example :
The company has a turnover of €13,000 for its regulated activities in 2024. The basic turnover threshold not to be exceeded is €35,000Thus, it can benefit from the exemption on the basis of VAT.
If the company had started its activity on 14 May 2024 and had achieved a turnover of €13,000 between 14 may 2024 and 31 december 2024, its turnover for 2024 had to be calculated in proportion to the time it was active. For 2024, the turnover calculated pro rata to the operating time is equal to the turnover of the company multiplied by the number of days in 1 year and divided by the number of days between the date of creation of the company and the end of the year: (€13,000 x 365)/232 = €20,453.
The company’s pro rata turnover is less than €35,000Thus, it can benefit from the exemption based on VAT in 2025.
The VAT exemption system is applicable at one of the following times depending on how the company indicates its desire to benefit from the French exemption:
- Prior notification : from the date of communication its individual identification number by the competent authorities of the State in which it is established
- Updating Advance Notification : from the date of confirmation its individual identification number for updating the prior notification.
The exemption from VAT is applicable to sales and services where the company does not exceed certain turnover thresholds. However, there are a few transactions in which the VAT exemption does not apply.
These operations are as follows:
- Real estate transaction for the purpose of producing or delivering buildings (this does not apply to real estate works)
- Real estate operation with the aim of delivering to oneself renovation works of rental housing renovated by landlords (this does not concern real estate works)
- Transaction carried out by a farmer or a landlord of rural property who has opted for his transactions to be subject to VAT
- Transaction subject to VAT due to an option or authorization (removal and treatment of waste, transaction related to a banking activity, etc.)
- Intra-Community delivery of new means of transport.
The consequences of the VAT exemption are different depending on whether trade takes place in France, within or outside the EUEuropean Union.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Exchanges in France
As a professional who relief from the basic deductible, the company must charge for its services or sales without VAT, in other words excluding tax (HT).
The mention VAT not applicable - Article 293 B of CGI: titleContent must appear on every invoice or bill of fees. If this statement is not indicated, the company is liable to a tax adjustment for non-compliance with the administrative formality in the event of a tax inspection.
By benefiting from the VAT exemption system, the company is exempt from monthly or quarterly VAT declarations.
On the other hand, it cannot deduct VAT from its purchases (goods or services) made in the course of its professional activity. To be able deduct VAT on its professional purchases, the company must opt for the actual VAT system.
FYI
We must be vigilant on the mandatory details of invoices that the company emits and receives. In the event of non-conformity of the invoice, the company risks being penalized in the event of a tax inspection.
Mandatory mention (VAT not applicable)
Trade in the European Union
The exemption from French VAT is not applicable to trade within the European Union. To find out what rules apply, you must ask the EU Member States with which the company wishes to trade.
Trade outside the European Union
The exemption from VAT is not applicable to imports and exports by a company established in an EU Member State with a country located outside the EU. To find out the applicable VAT rules, you must ask your State of establishment.
The company that wishes to do so can opt to be subject to VAT even though it respects the turnover thresholds (turnover thresholds) to benefit from the VAT exemption system. This option to VAT allows him in particular to deduct VAT from business purchases.
The option to pay VAT is made with the company Tax Office (SIE) on which the company depends. She can contact him by email on his professional account on the website impots.gouv.fr:
Online tax account for professionals (EFI mode)
The option takes effect immediately on 1er day of the month in which it is declared.
It is valid for a period of 2 calendar years and is tacit renewal.
For give up at the option, the company must report it after a period of 2 years. On the other hand, if she has received a VAT credit refund, the option will be renewed for 2 years and she will not be able to renounce it during these 2 years.
The option must be taken from the company Tax Office (SIE) on which the company depends:
Online tax account for professionals (EFI mode)
Example :
A company opts to be subject to VAT on July 4, 2024. It will then be subject to the VAT of 1er July 2024 to December 31, 2025.
Option for VAT
The turnover threshold (turnover threshold) above which the company is no longer subject to the VAT exemption scheme is different depending on the nature of the activity carried out:
Répondez aux questions successives et les réponses s’afficheront automatiquement
Commercial and hosting activity
The company established within the European Union no longer benefits from the exemption from VAT if one of its turnover exceeds the following thresholds:
- Turnover of operations carried out in France : if the basic threshold of €85,000, the company is subject to VAT from 1er January of the following year. If its turnover exceeds the tolerance threshold of €93,500, the company ceases to benefit from the exemption system on the basis of VAT from 1er overshoot day.
- Turnover of operations carried out within the European Union (including France): if the turnover within the European Union exceeds the threshold of €100,000, it no longer benefits from the exemption system on a VAT basis from 1er overrun day.
Service Delivery Activity
The company established within the European Union no longer benefits from the exemption from VAT if one of its turnover exceeds the following thresholds:
- Turnover of operations carried out in France : if the basic threshold of €37,500, the company is subject to VAT from 1er January of the following year. If its turnover exceeds the tolerance threshold of €41,250, the company ceases to benefit from the exemption system on the basis of VAT from 1er overshoot day.
- Turnover of operations carried out within the European Union (including France): if the turnover within the European Union exceeds the threshold of €100,000, it no longer benefits from the VAT exemption scheme from 1er overshoot day.
Professional activity (except lawyer)
The company established within the European Union no longer benefits from the exemption from VAT if one of its turnover exceeds the following thresholds:
- Turnover of operations carried out in France : if the basic threshold of €37,500, the company is subject to VAT from 1er January of the following year. If its turnover exceeds the tolerance threshold of €41,250, the company ceases to benefit from the exemption system on the basis of VAT from 1er overshoot day.
- Turnover of operations carried out within the European Union (including in France): if the company's turnover within the European Union exceeds the threshold of €100,000, it no longer benefits from the exemption system on a VAT basis from 1er overrun day.
Lawyers
The company established within the European Union no longer benefits from the exemption from VAT if one of its turnover exceeds the following thresholds:
- Turnover of operations carried out in France : if the basic threshold of €50,000, the company is subject to VAT from 1er January of the following year. If its turnover exceeds the tolerance threshold of €55,000, the company ceases to benefit from the exemption system on the basis of VAT from 1er overshoot day.
- Turnover of operations carried out within the European Union (including in France): if the company's turnover within the European Union exceeds the threshold of €100,000, it no longer benefits from the VAT exemption scheme from 1er overshoot day.
Authors of works of the mind and performers
When the company realizes a turnover for the delivery activities of his works (authors) and assignment of rights (performers) that exceeds the threshold of €50,000, the company is subject to VAT from 1er January of the following year. On the other hand, if its turnover exceeds €55,000, the company ceases to benefit from the exemption system on the basis of VAT from 1er overshoot day.
Exceeding the turnover threshold for other activities does not affect the application of the VAT exemption regime on the activities of supplying its works (authors) and assigning its rights (performers).
The withdrawal from the VAT exemption scheme has the following effects:
- Submission of transactions to VAT from 1er overshoot day. Thus it must charge VAT to its customers. Invoices issued from this date must indicate the amount of VAT that has been invoiced to customers
- The company is now subject to the applicable rules on intra-Community VAT. For more information on the subject, you can consult our corresponding sheets (trade in goods or exchanges of services)
Who can help me?
The public service accompanying companies
Do you have a project, a difficulty, a question of everyday life?
Simple and free: you are called back within 5 days by THE advisor who can help you.
Definition of a taxable person for VAT purposes established in France or in the EU
VAT-based exemption thresholds
Transactions excluded from the VAT exemption
Mandatory mention - VAT not applicable
Prior notification of the use of the franchise within the EU by a company established in France
Suspension arrangements: imports and exports
Exemption based on VAT