On 22 September 2026, the French tax administration confirmed the abolition of the Simplified VAT Regime (Régime Simplifié d’Imposition – RSI) effective 1 January 2027, as enacted by Article 38 of the 2025 Finance Law (Loi de Finances pour 2025). The RSI previously allowed businesses with annual turnover below specific thresholds (€840,000 for goods, €254,000 for services) to file VAT returns semi-annually and pay installments based on the prior year’s liability. The removal aims to harmonize VAT compliance and improve real-time tax collection.
Key Takeaways
- Transition to Standard Regime: Affected businesses must switch to the standard monthly or quarterly VAT filing regime (Régime Normal) from January 2027, increasing administrative frequency and cash-flow management demands.
- Agricultural Exemption Maintained: The measure explicitly excludes agricultural operators who benefit from a separate simplified regime, ensuring continuity for the farming sector.
- Preparation Actions: Companies currently under RSI should reconfigure accounting systems for monthly VAT reporting, assess cash-flow impacts of accelerated payments, and consult tax advisors to optimize the transition.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement