France TVA Tax Rate - TVA 5.5% for property renovations in France
If you perform some work in a home, you can enjoy the reduced rate of VAT at 5.5% instead of 19.6%. To do this, you must give the artisan a certificate confirming compliance with the conditions of application of the reduced rate.
What type of property does TVA 5.5% apply to?
TVA at the reduced rate of 5.5% is for the upgrading, processing, management and maintenance on residential dwellings (principal residence or secondary) completed within two years and you are the owner, tenant or occupier of the property.
What Type of work/renovation can be done at TVA 5.5%
Only the work and equipment charged by an artisan are concerned. The equipment that you buy yourself and have installed by an artisan are subject to the standard rate of TVA at 19.6%. In this case, only the cost of the installation is subject to reduced rate of TVA 5.5%.
In all cases, the reduced rate is excluded for the work involved, by their nature or scale, the production of a new building. This limit is determined for all the work carried out over a period of two years. (In other words if you do some work on a property one year and then a bit more the next and that takes you over the parameters of renovation into the realms of a new build as laid out below you could be forced to pay the TVA back)
What is the definition of producing a new building from a renovation project in France?
This is important work which constitute more than a simple improvement and lead to produce a new building.
The TVA rate of 5.5% does not therefore on the work which, over a period of two years:
- lead to an heightening of the building or an addition construction
- Renew more than half of the shell, namely foundations, other elements that determine the strength and stiffness of the building (roof, walls) or the consistency of facades (excluding cleaning)
- Render into as new condition for more than two-thirds each of the second fix work: non-load bearing floors, exterior doors, partitions, plumbing, electrical and heating
- Increase the floor area of existing premises by more than 10%.
What are your obligations to have TVA 5.5% in France?
Sign the application form for the reduced rate of TVA 5.5%: The company may charge you a reduced rate if you give them a certificate confirming compliance with the conditions applied to the period of 2 years.
To do this, the original of the certificate, completed by you, must be given to each artisan performing the work, no later than before invoicing.
You must keep a copy of the certificate and all bills or notes issued by the (s) artisans (s) who performed the work until 31 December of the fifth year following their completion. These copies must be produced if the hotel des Impots asks you to justify the reduced rate of VAT.
Get the Paperwork for TVA 5.5%
To help you, you will find below links to two types of certificate accompanied by a leaflet, corresponding to different types of work performed.
You can use the simplified certificate for all work affected over a period of two years, none of the elements of structural work and not more than five of the six lots of finishing work.
Download Simplified TVA 5.5% Form
The standard certification is used in other cases.
Download the Standard TVA 5.5% Form
If you're not sure it's always worth seeking professional advice - it could save you money in the long run!