Following on from our article on why you register for VAT in Germany, this article takes a look at why you register for VAT in France. France is known to be one of the biggest ecommerce markets in Europe, a fact that has been underpinned by recent reports which have shown that French ecommerce generated over €112 billion in 2020 alone. France represents a fantastic opportunity for cross border ecommerce sellers, so let’s take a look at their ecommerce market in more detail and how you can begin trading there through VAT registration in France.
Massive Growth Due To Covid
The ecommerce market in France grew by over 8% in 2020. This, as with many other European countries, was due to lockdowns forcing the closure of traditional brick-and-mortar stores. This forced consumers online. Online sales of products and commodities increased by 32%, with internet sales overall increasing by 8.5%. The only sector of ecommerce that did not grow was the sale of services, which dropped by 10%. This can be explained by the drop in availability of travel and tourism during lockdowns.
Retail sales made up a lot of the growth, making up 13% of all online sales. This is further evidence that adopting an omnichannel business model will really add resilience to your business. We have definitely seen a strong correlation between online sales and business resilience. As we keep saying, it is not to late to move more of your business online, as the surge in ecommerce will almost certainly continue for the foreseeable future.
The Specifics Of French Ecommerce
On average, online transactions were worth about €60. This is an increase on previous years and is promising for ecommerce sellers. When you consider that there is over 41 million French people that buy online, this represents a massive market for sellers who are looking to expand their business to France.
One thing that sellers should consider though is the preferences of French consumers. Firstly, French consumers like to make purchases on mobile, with 41.4% of French buyers preferring to make transactions from their mobile phone. On top of this, instalment payments are extremely popular in France compared to other European countries. 30% of French consumers apparently prefer to use instalment payment options. PayPal is also a popular payment option in France, with 56% of shoppers using this as their preferred payment method.
VAT Registration In France
France is very similar to many other European countries when it comes to requiring you to register for VAT. If you are a UK seller, or based anywhere outside of the EU, you will have to register for VAT if you hold stock in the country. This is also the case if you ship goods from France and, as of the 1st of July, if you are based outside of the EU and make any sales to French consumers.
When it comes to VAT registration in France, you will be required to provide the typical information for registering for VAT in any country. This includes your full name and address, the address of your business and all your business’ relevant information. In terms of documentation, you will need your VAT certificate, your Articles of Association and an extract from your company’s national trade register.
Please be aware that all applications and correspondence must be conducted in French. This is why we would definitely advise you employ the services of an accountancy firm such as ourselves to assist you with the registration process. The whole process usually takes about 2 months. If you are based in the UK you will not need to appoint a tax representative. For more information, check out our guide on how to register for VAT in France.
We Can Help You Expand Your Business To France
VAT registration is an unavoidable step when it comes to expanding your business. Whilst it can be a daunting prospect, we are here to complete the process for you.
Our long history of working with ecommerce sellers, especially those who use Amazon and eBay, means we can guide you through every step of the registration process – so please do not hesitate to send us an e-mail at enquiries@jpaccountant.com to receive a quote today. In addition, we would be more than happy to help you register for UK & EU VAT and file your UK & EU VAT returns, and help you comply with VAT in case your account faces any issues.
