VAT for micro-enterprises in France 2026: thresholds, exemption and obligations

How does VAT work in a micro-enterprise?

By default, micro-entrepreneurs benefit from the VAT franchise exemption (Article 293 B of the French Tax Code). This means:

• You don't charge VAT to your clients
• You don't recover VAT on your professional purchases
• You don't file any VAT returns

This is a major competitive advantage: your prices are 20% cheaper than those of a VAT-registered competitor (for individual clients and non-VAT-registered businesses).

Mandatory notice on all your invoices: "TVA non applicable, article 293 B du Code Général des Impôts" (VAT not applicable, Article 293 B of the French Tax Code)

VAT thresholds in 2026

Franchise exemption thresholds

The VAT franchise exemption applies as long as your annual revenue doesn't exceed these thresholds:

Mixed activities

If you perform multiple activities (e.g., sales + services), each activity has its own threshold. However, your total revenue must not exceed €188,700 across all types.

Check your situation instantly with our VAT threshold simulator.

When must you charge VAT?

The 3 possible scenarios

Scenario 1: You stay below the franchise threshold → Nothing changes. You continue invoicing without VAT.

Scenario 2: You exceed the franchise threshold but stay below the enhanced threshold → VAT becomes applicable from January 1 of the following year (if the excess recurs the year after).

Scenario 3: You exceed the enhanced threshold → VAT applies immediately, from the first day of the month you exceeded. You must charge VAT from that date.

Practical example

Marie, freelance graphic designer (BNC), invoices regularly:

• January to August: €4,500/month → cumulative revenue = €36,000 (below threshold)
• September: €5,000 → cumulative = €41,000 (exceeds enhanced threshold of €39,100)
• Consequence: Marie must charge VAT starting September 1

Anticipate threshold crossings with our VAT threshold simulator which alerts you before reaching limits.

Transitioning to VAT: the steps

Step 1: Request an intra-community VAT number

Once you become VAT-liable, you must:

1. Contact your tax office (SIE) via your professional space on impots.gouv.fr
2. Request an intra-community VAT number — format: FR + 2 digits + your SIREN
3. Timeline: a few days to 2 weeks

Step 2: Choose your VAT regime

For most micro-entrepreneurs transitioning to VAT, the simplified regime is most appropriate.

Step 3: Update your invoices

Your invoices must now include:

• Your intra-community VAT number
• The pre-tax amount (HT) for each service
• The applicable VAT rate (20%, 10%, 5.5%, or 2.1%)
• The VAT amount
• The total including tax (TTC)

VAT rates in France

Impact on your prices

Advice: If your clients are mostly businesses (B2B), transitioning to VAT has no impact on your competitiveness.

Recovering VAT on your purchases

Once VAT-liable, you can deduct VAT paid on professional purchases:

• Computer equipment, software
• Supplies and consumables
• Travel expenses (fuel, tolls)
• Professional subscriptions
• Subcontracting

Is VAT deduction worthwhile?

If you have significant professional expenses, voluntarily opting for VAT can be worthwhile even without exceeding thresholds. Discuss with your accountant or use a tool like Pennylane.

VAT and international services

Selling to EU clients

When selling services to European businesses (B2B), VAT is reverse-charged by the client. You invoice pre-tax with the mention:

"Autoliquidation de la TVA — Article 283-2 du CGI" (VAT reverse charge)

Selling to non-EU clients

Services to clients outside the European Union are VAT-exempt. Invoice pre-tax.

Buying from EU suppliers

If you purchase goods or services from European suppliers for more than €10,000/year, you must obtain an intra-community VAT number even under the franchise exemption.

Voluntarily opting for VAT

Why opt in?

Even without exceeding thresholds, you can waive the franchise exemption and voluntarily become VAT-liable. This is worthwhile if:

• You have significant investments (equipment, vehicle, setup)
• Your clients are primarily B2B businesses (no price impact)
• You frequently work with European suppliers

How to opt in?

1. Send a letter to your tax office requesting VAT registration
2. The option takes effect on the 1st day of the month of the request
3. The option is valid for 2 years and automatically renews

Common mistakes to avoid

1. Forgetting the VAT notice on invoices

Under the franchise exemption, every invoice must carry the notice "TVA non applicable, art. 293 B du CGI". Missing it can result in a €15 fine per missing notice.

2. Not monitoring your thresholds

Exceeding the enhanced threshold triggers immediate VAT application. Without anticipation, you'll have to absorb the 20% VAT on invoices already issued that month.

3. Confusing VAT thresholds with micro-enterprise revenue caps

The micro-enterprise revenue caps (€188,700 / €77,700) are different from VAT thresholds (€91,900 / €36,800). You can be a micro-entrepreneur liable for VAT between these two thresholds.

Summary: VAT for micro-enterprises 2026

• Franchise exemption by default: no VAT to charge or declare
• Franchise threshold: €91,900 (sales) / €36,800 (services)
• Enhanced threshold: €101,000 (sales) / €39,100 (services) → immediate VAT if exceeded
• Mandatory notice on invoices: "TVA non applicable, art. 293 B du CGI"
• VAT transition: request a VAT number + choose a regime (simplified recommended)
• You can voluntarily opt for VAT if advantageous (B2B, investments)
• VAT thresholds are different from micro-enterprise revenue caps