France B2G e-Invoicing has already been effective since 2017 through the Chorus Pro platform, which businesses use to issue e-Invoices to government agencies and public entities. Now, France is to implement B2B e-Invoicing and B2C e-reporting in a phased approach starting from 1 July, 2024, in compliance with Chorus Pro. The French Tax Authority (DGFIP) confirmed the country-wide use of the e-Invoicing mandate through Ordinance No. 2021-1190, published in the French Official Journal on September 16, 2021. The main goals to implement e-Invoicing are to increase total business productivity, reduce the fiscal gap, the costs of tax control, and payment processing costs.
Scope of the regulation
The French government passed Ordinance No. 2021-1190 on September 15, 2021, which was published in the French Official Journal on September 16, 2021. This legislation confirms the introduction of:
- Obligatory e-Invoicing for domestic B2B transactions
- Obligatory e-reporting of transactional data for cross-border B2B transactions (including sales and purchases), B2C transactions taxable in France, and payment data for services
Transmission methods of e-Invoices
Taxpayers may opt to issue, exchange, transmit, and process the invoices electronically in one of two ways:
Firstly, taxpayers may choose to issue their invoices through Chorus Pro-based national invoicing portal PPF (Portail Public de Facturation), where the delivery process and reporting will be done automatically in DGFIP. PPF is the public invoicing portal and is a publicly trusted third party responsible for concentrating invoices and invoicing data sent by companies, and forwarding them to the tax administration.
Secondly, taxpayers may issue their invoices through a PDP (Plateformes de Dématérialisation Partenaire), which acts as a trusted third party. The French government has chosen the “Y” model. This means that invoices can transit directly between these certified private platforms without using the public platform. PDP will oversee transforming, validating invoices, and sending them to the French tax authorities, as well as reporting the invoicing data required for e-reporting to the government. Through dematerialization platforms, electronic invoices can be sent and received in the defined structured format, and the entire electronic invoicing and reporting exchange process is secure in terms of integrity, authenticity, and confidentiality. The dematerialization platform will distribute the e-Invoice to the buyer through the PPF or the buyer’s PDP, then report it to the tax authority.
E-invoicing and e-Reporting will become mandatory for all companies subject to VAT in France and will be implemented in three stages, depending on the size of the company. The compliance timeline for the new electronic invoicing and e-Reporting system is as follows:
- From 1 July 2024, all France-based businesses will be required to be able to receive e- Invoices. Besides, large businesses will be required to both receive and issue e-Invoices whose scale is determined by the government. Large companies with more than 5,000 employees have more than 1.5 billion euros in turnover and more than 2 billion euros in balance sheets.
- From 1 January 2025 medium-sized France-based businesses will be required to receive and issue e-Invoices. Medium-sized companies have 250 to 5,000 employees and have an annual turnover not exceeding 1,500 million euros or whose balance sheet total does not exceed 2,000 million euros.
- From 1 January 2026 small and micro-businesses based in France will have to receive and issue e-Invoices. Medium-small companies have 10 to 250 employees and also annual turnover does not exceed 50 million euros or whose balance sheet total does not exceed 43 million euros. Micro companies which have less than 10 employees and annual turnover excluding tax do not exceed €176,200.
In addition, a pilot phase for mandatory e-invoicing is scheduled for January 2024.
Technical details of e-Invoice
In France, e-Invoices will be accepted in a variety of formats. Only structured formats will be considered as valid e-Invoices that comply with the European norm EN16931:
The above formats will be required for electronic invoice information. Until January 2028, taxpayers can submit their invoices in PDF format instead of one of the structured formats and PDPs and the PPF must be able to convert PDF invoices to one of the structured formats
Also, electronically issued documents must also be stored electronically. In France, there is a mandatory archiving period of 10 years.
How can SNI help you?
SNI’s France B2B e-Invoicing SAP add-on solution will enable you to generate invoices in the required format and exchange these invoices through Chorus Pro. The invoice creation, XML conversion, and sending functionalities can be automated in the SAP. Data extraction, mapping and processing, and communication with the tax authorities can be done through SNI’s end-to-end SAP add-on solutions.