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France decreases threshold distance sales

When you supply goods to private individuals or non-businesses in other EU member state and these goods are transported to the other EU member state, you have to consider the VAT distance selling rules. In case the goods are transported from the Netherlands, you will first charge Dutch VAT. However, when the threshold in the ship to member state is exceeded or is exceeded in the previous year you will have to charge the VAT rate as applicable in this member state. This means you will have to register in the particular member state for distance sales. The thresholds vary per EU member state and range between €35.000 and €100.000.

You can also opt to ignore the distance sales thresholds and directly charge VAT at the rate applicable in the member state of the customer. In this situation you will have to inform your tax authority that the thresholds in a particular member state will be ignored (in the example the Netherlands has to be informed). The thresholds are any way not applicable to excise good, here you always need to charge the foreign VAT rate.

Recently France has announced that the French threshold for distance sales will be decreased from €100.000 to €35.000 as from 01.01.2016. This means that distance sales to France will earlier trigger a French VAT registration. Maybe more member states that currently apply the higher threshold (like Germany and the UK), will follow this example, we will keep you informed.

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