The simplified VAT reporting regime is going to be abolished from January 1, 2027. The end of the simplified VAT regime, currently used by thousands of businesses, means more compliance costs and more bureaucratic challenges.
New VAT reporting compliance burden for businesses in scope means that use and enjoyment of the simplified reporting scheme will be replaced by monthly or quarterly reporting, alongside other compliance requirements. The reform, introduced under Article 38 of the 2025 Finance Law, will be applied automatically by the tax administration based on prior year turnover.
Businesses that are currently registered for the simplified VAT regime shall be automatically registered/moved into the standard VAT regime. No separate registration filing is needed for this.
France Simplified VAT Regime
Businesses that are currently benefiting from the simplified VAT regime are permitted to submit a single annual VAT return, supplemented by two interim installment payments during the fiscal year, provided their annual VAT threshold doesn’t reach EUR 15,000, and other conditions.
Starting from 2027, taxable persons in the scope of the new VAT regime will move into monthly or quarterly reporting periods. Quarterly or monthly(CA3 returns) filing obligations depend on the turnover made in the previous or current year.
- Quarterly (CA3 returns): Applies if the prior-year turnover (including taxable acquisitions) is below EUR 1 million; or if the current-year turnover is below EUR 1.1 million.
- Monthly (CA3 returns): Required for businesses exceeding those turnover thresholds.
- Annual declarations (such as CA12 or CA12E) and semi-annual instalment schedules are replaced by periodic CA3 reporting
- Exemptions: The simplified VAT regime for agricultural businesses remains unaffected.
New VAT Regime
The shift into the new regime shall be orchestrated by the French Directorate General of Public Finances. The mutual condition used for identifying the economic operators that are mandated to follow the new 2027 reporting route is the turnover number reported under the previously filed annual return.
If the responsible taxable person skipped the obligation to submit the annual return for the previous year, that business shall be automatically signed up for the quarterly reporting obligation.
Taxable persons using the calendar year accounting and reporting obligation will submit their first CA3 return monthly(for January) or quarterly(January-March), while the final annual CA12 return covering the period ending December 31, 2026, remains due by May 4, 2027.
Taxable persons that aren’t following the reporting and accounting regime defined on a basis of the calendar year are subject to separate transitional timing.
Next Steps
Businesses that are in the scope of the new rules and requirements should adapt their internal business processes to align with the new compliance requirements.