SaaS and B2B/B2C services sold in France by a foreign business: VAT and tax obligations
Online software, SaaS subscriptions, digital platforms: your French VAT obligations vary depending on whether your customers are businesses or private individuals. This guide untangles the applicable rules.
B2B sales in France: the reverse charge simplifies obligations
When a foreign business sells a digital service (SaaS, cloud software, online platform) to a French business that is a taxable person, the reverse charge mechanism applies. In practice, it is the French buyer that declares the VAT in its own return — the foreign provider does not need to collect or remit VAT on this transaction.
This mechanism, provided for in Article 283-1 of the French General Tax Code (CGI), applies when the service provider is not established in France and its customer is a French taxable person. The invoice issued by the foreign provider must state "VAT reverse charged" and the customer's intra-community VAT number. This rule covers virtually all B2B SaaS sales to French businesses.
B2B: no tax representative if you only sell to French businesses
If your activity is limited to B2B service provision in France (all your customers are taxable professionals), you have no obligation to register for VAT or designate a tax representative for these specific operations.
B2C sales in France: VAT obligations and registration
As soon as you sell a digital service to private individuals (non-taxable consumers) resident in France, the rules change radically. You become liable for French VAT on these sales, with no possibility of applying the reverse charge since private individuals do not declare VAT.
For EU-established businesses, the OSS allows VAT declarations for all member states to be centralised from the country of establishment. This is a major simplification. But for non-EU businesses, this facility is not available for standard digital services.
Customer type
VAT mechanism
Registration obligation in France
French business (B2B)
Reverse charge by the customer
No (in principle)
French private individual (B2C) — EU seller
French VAT — collection via OSS
No (OSS available)
French private individual (B2C) — non-EU seller
French VAT to collect
Yes + tax representative
Non-EU businesses: tax representative mandatory for B2C
A US, British, Canadian or Australian business selling SaaS subscriptions or software licences to French private individuals must mandatorily designate an accredited tax representative in France under Article 289 A of the French General Tax Code (CGI). This obligation applies from the very first euro of sales to a French private individual.
The tax representative carries out the following steps on your behalf:
VAT registration with the Foreign Business Tax Office (SIEE)
Obtaining a French intra-community VAT number
Filing monthly or quarterly CA3 returns
Remitting collected VAT to the French Tax Authority (DGFiP)
Retaining required supporting documents
Practical example
A Californian startup markets a project management tool as SaaS. It has 200 private subscribers in France (students, freelancers) generating annual revenue of €40,000 before tax. It must collect VAT at 20% on these sales (i.e. €8,000), designate a tax representative in France and file quarterly VAT returns. Without a tax representative, it is exposed to tax reassessments and penalties.
Mixed B2B + B2C activity: how to organise it
Most international SaaS publishers have a mixed customer base: businesses and private individuals. In this case, it is the B2C situation that determines the obligations: as soon as you have a single French private individual customer, you are required to register and designate a tax representative (if you are outside the EU).
Your tax representative will manage all your French obligations, whether for B2C sales (with VAT to collect) or B2B sales (to be accounted for differently). They will also advise you on structuring your invoicing to distinguish between the two types of flows.
Risk of reclassification
The tax authorities can reclassify certain sales presented as B2B as B2C if the buyer has not provided a valid VAT number. In this case, French VAT is due and the foreign provider is liable. A tax representative helps you secure this validation process.
To navigate smoothly through the complexity of French VAT obligations for your digital services, use an accredited DGFiP tax representative, specialising in digital and SaaS activities.
Frequently asked questions
In B2B, the reverse charge mechanism applies: it is the French business customer that declares and pays the VAT. The US SaaS provider therefore does not need to collect VAT in France on these sales. However, if it also sells to French private individuals (B2C), it must mandatorily register for VAT and designate an accredited tax representative.
The reverse charge is the mechanism by which the French business customer declares the VAT itself on purchases of services from foreign providers not established in France. It then recovers this VAT if it is a taxable person. The foreign provider does not collect VAT on these invoices but must mention "VAT reverse charged by the recipient" and its VAT number.
No. The OSS for electronic services (formerly MOSS) is reserved for businesses established in the EU. A non-EU publisher selling SaaS subscriptions to French private individuals must register directly for VAT in France and designate a tax representative accredited by the French Tax Authority (DGFiP).
According to the European VAT Directive, the following are considered electronic services: online software (SaaS, cloud), online games, digital content (music, videos, e-books), websites and hosting. They are taxable in France when provided to French consumers, regardless of the country where the provider is established.
The invoice must include French VAT at the applicable rate (20% for most software). It must state your French VAT number (obtained through your tax representative), the VAT rate and amount, as well as your company name and that of your tax representative. The representative will then remit this VAT to the French Tax Authority (DGFiP).
Browse our list of tax representatives accredited by the French Tax Authority (DGFiP). Compare specialities, get a quote and secure your tax obligations in France.
