France, One of the EU's Largest Economies, introduces Continuous Transaction Controls

France E-Invoicing from 2023

France is introducing continuous transaction controls (CTCs). From 2023, France will implement a mandatory B2B e-invoicing clearance and e-reporting obligation. With these comprehensive requirements, alongside the B2G e-invoicing obligation that is already mandatory, the government aims to increase efficiency, cut costs, and fight fraud.

From 2023, all B2B invoices will be transmitted through a central platform, or via certified service providers connected to that central platform. This e-invoice clearance will lay the foundation and provide the French tax authority with data relating to any domestic B2B transaction.

To effectively combat fraud, the tax authority will need access to more transaction data. Therefore, data that the tax authority will not receive as part of the e-invoice clearance process will be subject to the complementary e-reporting obligation. For example, B2C invoices and cross-border invoices, as well as certain payment data.

So the tax authority will receive B2C and B2B transaction data (including certain payment data) by two measures; the e-invoice clearance mandate combined with the e-reporting obligation.

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France B2B e-invoicing quick facts

  • The proposed requirements come into effect during the years 2023-2025.
  • The e-invoice clearance process will be based on a model of certified service providers connecting taxpayers to a centralized platform.
  • E-invoicing standard format is the Factur-X, a hybrid structure that allows both XML and PDF submissions.
  • For e-invoices, all existing tax mandatory fields as well as those required by commercial laws will have to be issued, including item-line details. The operation type (goods, services, mixed) and the VAT payment option will also be mentioned in the invoice. Both structured and hybrid (image + structured data) formats will be accepted, but the allowed formats are not yet defined.
  • For e-reporting, the level of detail will be dependent on the financial software used by the supplier. Small companies without accounting software will report less details than a corporation equipped with an ERP or billing software.
  • Payment status data for each invoice provided by both the buyer (payment sent) and supplier (payment received).

French e-invoice & e-reporting rollout dates

  • 1 January 2023: Large companies will be subject to the B2B e-invoice clearance and e-reporting mandate. There is no requirement to clear B2C and cross-border invoices but there is an obligation to report so the tax administration has full visibility. All companies must accept e-invoices under the new mandate.
  • 1 January 2024: Obligations will apply for medium-sized companies.
  • 1 January 2025: All companies will be in scope of the mandate by 1 January 2025.

How Sovos can help

Sovos serves as a true one-stop-shop for managing all e-invoicing compliance obligations in France and across the globe. Sovos uniquely combines local excellence with a seamless, global customer experience.