France: VAT and e-invoicing; implementation effective 1 January 2023

France: VAT and e-invoicing; implementation

Measures introducing the phased-in implementation of an electronic invoicing (e-invoicing) between taxable persons as well as an obligation to transmit electronically (e-reporting) certain invoicing data to the French tax authorities have been clarified by the Finance Bill for 2021.


These provisions concern value added tax (VAT) reporting.

The Finance Bill for 2021 (law n° 2020-1721) specifically clarifies the terms of application of these requirements and authorizes the government to act by ordinance within nine months of its publication. The government, thus, by September 2021 will need to have adopted an ordinance regarding the use of electronic invoicing and the requirement to transmit related information to the French tax authorities.

The e-invoicing requirements has an effective date of 1 January 2023.

The e-invoicing measures are to be phased in between 2023 and 2025, according to the following schedule (depending on the size of the company):

  • 1 January 2023 for large companies
  • 1 January 2024 for mid-sized companies
  • 1 January 2025 for small and mid-size entities and for very small entities 

With regard to the e-reporting requirement (for transmitting reports to the tax authorities), the same timetable (as noted above) applies with regard to the following transactions:

  • Transmission of data concerning business-to-business (B2B) transactions
  • Transmissions of data concerning business-to-consumer (B2C) transactions
  • Transmission of data concerning operations with foreign operators
  • The payment status of invoices

As of 1 January 2025, paper invoices will no longer be allowed for all B2B and B2C transactions.

KPMG observation

The precise terms and conditions for the implementation of e-invoicing and e-reporting obligations have not been officially announced. Since the October 2020 release of a report by the tax authorities on VAT in the digital age, there have been discussions between the French tax authorities and various stakeholders to determine the precise terms and conditions for implementing the e-invoicing rules.

Several approaches are currently being studied including the so-called “Mexican model” (that is, certified platforms that issue invoices on VAT in an electronic format and transmit the data to the French tax authorities). Concerning the format of electronic invoices, the use of PDF files is viewed as a transitional solution, and not one for future long-term use. There also have been considerations of conditioning the deductibility VAT to the submission of an electronic invoice. Finally, compliance with the e-invoicing and e-reporting requirements would not affect the obligation to establish a reliable audit trail (or the obligation to verify the authenticity, integrity, and legibility of invoices).

Read a March 2021 report [PDF 69 KB] prepared by the KPMG member firm in France

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