Following on from the previous article on French VAT rates, this time the editors work in Given France will explain why the service fees for French VAT fiscal representative vary widely.
Simply put, the seller’s fiscal representative is the main bridge between the sellers and the French tax authority. It is the fiscal representative of the cross-border seller who performs the administrative duties related to the application VAT number, the search and filing, the VAT declaration and the payment of taxes.
Fiscal representative and cross-border e-commerce are fiduciary-client legal relationships. Once the cross-border e-commerce has signed a service agreement with its VAT fiscal representative, the fiscal representative will be responsible for legal declaration and payments which are known as joint and several liability. In order to protect the interests of cross-border e-commerce and to reduce their legal risks, the regular and responsible fiscal representative must complete the declaration and payment of VAT for e-commerce in strict compliance with French tax law.
The specific tasks of a fiscal representative include:
- Invoices are issued for cross-border e-commerce in their fiscal representative capacity and must indicate their fiduciary status. Cross-border e-commerce may also issue invoices by themselves, but they must indicate the name, address and VAT number of their fiscal representative. In practice, the vast majority of e-commerce do not require a fiscal representative to issue invoices.
- The fiscal representative represents its cross-border e-commerce in the accounting of the latter’s transactions in France. If the cross-border e-commerce prefers to do it by themselves, it will need to ensure that its fiscal representative is able to submit its accounting books and transaction records to the local French tax authorities.
- Fiscal representatives submit turnover declarations for cross-border e-commerce.
- Fiscal representatives pay VAT on behalf of cross-border e-commerce.
- Fiscal representatives submit transaction declarations of goods and services in the EU for cross-border e-commerce. (DEB – DES)
At present, there are a lot of VAT representative and intermediaries in France with huge price differences. Some of them take advantage of the seller’s desire for a bargain to attract customers with prices below the cost of services. What are the potential risks to cross-border sellers from below-cost pricing?
- It is possible to be late in applying for a VAT number without solution. Most low-price tax representatives do not have the professional accounting and legal team. They do not know about the French tax regulations and do not have enough experience.
- The French tax authority requires e-commerce to pay penalties and late fees, so that they are taking unnecessary losses and increasing the tax risk. Delays in declaring time, errors in declaring, delays in paying VAT, and incorrect payment of VAT can all bring economic loss to e-commerce when tax representatives declare turnover.
We recommend Amazon sellers and other cross-border sellers, when they choose a French tax representative, they should not only check price, but also evaluate the qualifications and experience, such as whether it is a formal company with its own professional accounting team. At the same time, they should communicate with their counterparts and choose a tax representative with a good reputation.
If you need professional French VAT representative, please feel free to contact European Tax and Administrative Service (ETAS). We will provide you with a guaranteed professional tax representative service.
