franchise en base de TVA — client crossed €37,500 in August, when does he lose it?
micro-entrepreneur client. prestation de services. hit €37,500 cumulative revenue on 12 August 2025. threshold for services is €37,500 / €41,250 (tolérance).
my reading of article 293 B CGI:
- cross €37,500 but stay under €41,250: you keep franchise for the rest of the year, lose it 1 Jan of the next year
- cross €41,250 at any point: franchise lost from the 1st of the month in which you crossed
client is at €37,500 not €41,250. so he stays franchisé for 2025, applies TVA from 1 Jan 2026.
but then he must actually register for TVA, file CA3 monthly or quarterly, and charge TVA from 1 Jan. usually i tell clients to start the register process in November.
anyone disagree with this reading? DGFIP guidance has been inconsistent since the 2025 reform.
3 replies
your reading matches article 293 B and BOFIP-TVA-DECLA-40-10-10. the two-tier threshold is deliberate — the "tolérance" at €41,250 gives clients a buffer.
one French-specific gotcha: even if he stays franchisé, the INVOICES he issues must no longer include the "TVA non applicable article 293 B" mention if he's approaching the threshold — once over €37,500 he should just not mention TVA at all on subsequent 2025 invoices.
also make sure he starts collecting client TVA numbers NOW for any B2B EU clients — he'll need them for intra-Community supply treatment starting 1 Jan.
merci Anna. good callout on the invoicing mention — i always forget that one. will update his facture template.
italy has a similar 2-tier system for regime forfettario (€85k limit, €100k hard cliff). very painful when clients cross mid-year because the retroactivity rules differ.
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