FOREIGN CONSTRUCTION COMPANIES & FRENCH VAT RULES
Since 1 January 2010, services connected with immovable property located in France are subject to French VAT including when the company performing these operations is not based in France.
Foreign Architectural Firms and French VAT
A foreign architectural firm which draws up plans for a building or parts of a building to be erected on a specific plot of land in France, is liable to include French VAT on its service invoice.
However, there is an exception to this rule when the customer of the architectural firm (i.e. the Project Owner or the Main Project Supervisor) has a VAT identification number in France. In this specific case, no French VAT should be charged on the architectural services.
The VAT rule and the exception mentioned above will be applicable to the services provided by the foreign architect, no matter if the building is actually erected or not.
It is strongly recommended to foreign architects carrying out construction projects on behalf of private individuals in France (or a company not registered for VAT purposes in France) to appoint a tax representative where appropriate and request a French VAT registration number at the early stage of the project. Indeed, it has been noticed that the French Authorities can request to the foreign architect to provide its VAT number in France when applying for a building permit for a private house.
Foreign Construction Companies and French VAT
When a foreign construction company is engaged in a building project in France, invoicing rules will depend on the VAT status of the principal in France. If the construction works are carried out on behalf of a principal identified for VAT purposes in France, the invoice should NOT include French VAT.
Considering the VAT exempt transaction (due to reverse charge mechanism), the foreign construction company will be entitled to obtain the refund of VAT paid on its purchases or imports of building materials in France.
However, the construction works carried out on behalf of a private individual (e.g. a house-building project) or an organization (company / public body) not registered for VAT in France must lead to an invoice with French VAT. The appointment of a tax representative would be necessary for the fulfillment of the VAT obligations in France, especially in the case where the construction company is based in a non-EU country.
Professions in the construction industry
- Bricklayer / Mason
- Carpenter (metal & woods)
- Crane operator / Crane driver
- Demolition worker
- Waterproof worker
- Glass / Mirror worker
- HVAC Installer (Heating, Ventilation and Air-Conditioning)
- HVAC Maintenance technician
- Carpenter fitter
- Carpet fitter