In addition to the existing B2G e-invoicing obligation, France is now introducing mandatory B2B e-invoicing from July 2024. This requirement is based on Continuous Transaction Controls (CTCs), which enable the government to obtain real-time control of VAT information. The aim is to combat tax fraud and thus reduce the VAT gap.
In this blog article, I explain the upcoming B2B e-invoicing requirements for France in detail.
Requirements and deadlines for e-invoicing in France
Currently, there is already a requirement that all business-to-government (B2G) transactions in France must be processed using e-invoicing.
Now the French government has set deadlines for the domestic B2B sector.
The following timetable shows which deadlines apply to the issuing of electronic invoices:
- July 2024: Compliance deadline for major corporations
- January 2025: Compliance deadline for SMEs
- January 2026: Compliance deadline for the smallest companies
However, it should be noted that the obligation to accept electronic invoices already exists from 1 July 2024. This applies regardless of the size of the company.
France has chosen to implement the requirements for the Y-model and is providing the Chorus Pro national platform as a public invoice portal for this purpose. Invoicing parties and invoice recipients, therefore, have various ways to meet the legal requirements and to be able to receive and send electronic invoices. They can either connect directly to the Chorus Pro platform or carry out the business transaction indirectly through a service provider.
Although direct use of the Chorus Pro invoice portal is very time consuming and resource-intensive, it does give those companies that are not able to create their invoices in XML format the opportunity to comply with the e-invoicing obligation.
The illustration below shows the different channels available to invoicing parties and invoice recipients:
This results in four different ways in which the sending and receiving process can be handled:
Option 1
- The invoicing party files their invoice directly in the Chorus Pro portal
- Chorus Pro forwards the invoice to the invoice recipient
- The recipient receives, checks and retrieves the invoice through the Chorus Pro platform
- Chorus Pro forwards the invoice data to the tax authorities
Option 2
- The invoicing party files their invoice on their partner platform
- The invoicing party’s partner platform sends the invoice to the recipient’s partner platform
- The recipient’s partner platform sends the invoice data to the Chorus Pro platform
- The invoicing party’s partner platform sends the updated invoice status to the invoice recipient’s partner platform
- Chorus Pro sends the invoice data to the tax authorities
Option 3
- The invoicing party submits the invoice through their partner platform
- The invoice recipient’s partner platform sends the invoice to the Chorus Pro platform
- The recipient receives, checks and retrieves the invoice through the Chorus Pro platform
- Chorus Pro sends the invoice data to the tax authorities
Option 4
- The invoicing party files their invoice on the Chorus Pro platform
- The Chorus Pro platform sends the invoice to the invoice recipient’s partner platform
- The recipient receives, checks and retrieves the invoice through their partner platform
- Chorus Pro sends the invoice data to the tax authorities
In addition, there is a requirement for electronic reporting to the tax administration with e-reporting for B2C and international B2B transactions. This covers all tax information that is not provided for by the e-invoicing obligation for B2G and domestic B2B transactions. This is also done through the Chorus Pro platform, which forwards the relevant information to the tax authorities.
The following information must be included in the tax return:
- The taxpayer’s identification number
- Payment date
- Payment amount for all transactions
- Number of daily transactions
- Period for which the information is being transferred
- The total amount and the amount of corresponding tax
- Currencies
SAP Document & Reporting Compliance
I recommend the SAP Document & Reporting Compliance solution to comply with French e-invoicing requirements.
SAP Document & Reporting Compliance is a strategic, integrated SAP solution that works with SAP ECC and SAP S/4HANA.
SAP has already developed a solution to meet French e-invoicing requirements. However, this solution can also ensure compliance with many other country-specific legal requirements around the world. All introduced country-specific legal requirements can be easily managed with the SAP eDocument Cockpit, which plays a central role in SAP Document & Reporting Compliance. With SAP Document & Reporting Compliance you have an end-to-end solution that automatically generates the required XML files based on source information from your SD or FI billing documents and digitally signs the XML file if required. SAP Document & Reporting Compliance can refer to SAP CPI, SAP PI or third-party EDI middleware systems to manage all data traffic with local tax authority systems.
Why you should meet the e-invoicing requirements
The most important reason for complying with e-invoicing requirements is to avoid fines, as non-compliance is penalised accordingly. It is, therefore, crucial to making the necessary SAP adjustments to ensure compliance with French e-invoicing regulations.
These SAP adjustments usually require some work and investment. However, the SAP Document & Reporting Compliance solution also gives your company several advantages: It is a strategic solution that offers the reuse of SAP licences and basic configuration for compliance with other country-specific legal requirements. This ensures your company’s compliance in the long term.
How PIKON can help you
At PIKON we have established the Competence Center for Legal Requirements where our consultants monitor and investigate legal requirements worldwide and how they impact the SAP system. Our team consists of experts who combine in-depth knowledge and experience from our numerous projects in the areas of SAP Document & Reporting Compliance and local implementation projects around the world, such as SDI in Italy, SII in Spain, CFDI and Complemento de Pago in Mexico, RTIR and EKAER in Hungary, XRechnung and ZUGFeRD in Germany, e-invoicing and e-archives in Turkey, DIAN in Columbia, MyDATA in Greece etc. As a strategic partner, we offer our customers the best possible solution in each case to ensure that their SAP system and business processes comply with different country-specific legal requirements. We also regularly attend to new or changing legal requirements that are relevant for our clients and inform them when action is required. As a result, customers can focus on their day-to-day business and not worry about not complying with the necessary regulations.
If you have any questions about the French e-invoicing regulations or are interested in a system demo with the e-invoicing processes, do not hesitate to request a web meeting or leave a comment at the end of the blog post. We will be happy to assist you and get back to you as soon as possible.