Box B4 of the VAT return: Important points to keep in mind

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General presentation of box B4

Box B4 concerns provision of services And the deliveries of goods carried out by companies that are not established in France. This means that the transactions are carried out from the headquarters or permanent establishment of the supplier located outside France. It is crucial to properly identify these transactions for a compliant declaration.

Details of the transactions concerned

Services provided under article 259-1° of the FTC

• Traditional benefits : These are all services provided by foreign suppliers that are taxable in France.
• Foreign suppliers : Service providers can be established in the European Union (EU) or outside the EU.

Operations referred to in article 283-1 of the FTC

This article states that when a taxable supply of goods or services in France is carried out by a taxable supplier outside France, the VAT is paid by the buyer, provided that he is subject to VAT and has a VAT number in France.

Basic criteria

1. Supplier not established in France : The purchase is made from a taxable professional who is established outside France.
   • lookout : The fact that your supplier has a VAT number or a SIREN number in France is not determinative to consider that he is established in France.
   • example : A supplier established outside the EU may have a VAT or SIREN number in France, but remains considered not established in France if its head office or permanent establishment is abroad.
2. Types of transactions concerned :
   • Domestic sales of goods made in France : Goods whose place of dispatch and delivery is in France, but sold by a foreign supplier.
   • Services located in France : Includes rentals of means of transport in France, services related to a building in France, expertise carried out in France, etc.

The expert's point of view

Focus on a received idea

It is sometimes claimed that services provided by providers located outside the EU do not have to be declared in box B4 and do not require reverse charging of VAT. It's wrong. All services provided by service providers not established in France must be reported in this box, regardless of whether they are located in the EU or outside.

How do I report these transactions?

1. Report in case B4 : Indicate the amount excluding taxes (HT in French) of purchases of goods or services made from a taxable person not established in France.
2. Report in frame A : This amount excluding VAT must also be reported in Box A3 of the VAT return.
3. VAT collection : The amount excluding VAT must be reported in the corresponding boxes (08, 09 or 9B) according to the applicable VAT rate, in order to collect VAT on the acquisition.
4. Auto-liquidation : The VAT must be autoliquidated, i.e. the amount of VAT relating to this acquisition must be reported in Box 20 from the VAT return to be deducted.

Importance of reverse charge

• Penalties in case of default : Not auto-liquidating VAT exposes you to 5% penalty of the amount of VAT that has not been automatically paid.
• Impact for taxable persons : Even if you recover 100% of the VAT on your expenses, this penalty can be expensive.

Points of attention

• Supplier status check :
  • A supplier whose head office is abroad may have a permanent establishment in France. In this case, it is considered established in France for VAT purposes.
  • It is essential to check whether your supplier is really not established in France to determine your reporting obligations.
• VAT incorrectly charged :
  • Any VAT incorrectly invoiced by a supplier not established in France is not deductible. It is therefore crucial to ensure that VAT is properly invoiced and declared.

Important points to keep in mind

• Correctly identify suppliers not established in France : Do not rely solely on the presence of a VAT or SIREN number in France.
• Understanding the reverse charge mechanism : Make sure you are familiar with this process to avoid reporting errors.
• Use additional resources : Our detailed video on box B4 gives you additional light.
• Be accompanied : A tax lawyer can help you secure your VAT returns and verify the status of your suppliers.

Conclusion

Box B4 of the CA3 VAT return is crucial for companies making purchases of goods or services from suppliers not established in France. By understanding the specifics associated with this box and by reporting these transactions correctly, you ensure the tax compliance of your business and avoid potential sanctions. Do not hesitate to consult our dedicated video to deepen these points and to ask a professional to assist you in this process.

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