Applying VAT on services to the French DOM

If you are a seller from Metropolitan France providing services to customers in the DOM-TOM, here is what you need to know:
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This article only applies to sellers in France. Generally, only French businesses must collect VAT on sales to DOM. The French DOM are composed of Guadeloupe, Martinique, Reunion, Guyana, and Mayotte. VAT applies in Guadeloupe, Martinique and Reunion.

B2B Sales

When you make B2B sales to customers in France (Metropolitan or DOM), Quaderno applies the tax rate based on the customer’s location.
Quaderno distinguishes a B2B sale to a DOM region based on the customer’s tax ID and postal code. When the taxable customer is based in  Guyana or Mayotte, no VAT would apply.
 
B2B French DOM VAT cases
Seller
Buyer
Applicable rate
Metropolitan France
Rate applicable in mainland France
Martinique, Guadeloupe or Reunion
Rate applicable in the overseas departments
Guyana, Mayotte
No VAT
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This is in line with the guidance provided by the French tax agency. Please review if this applies to your case. Note that certain services may be taxed at the rate based on the supplier’s location.

B2C Sales

When you make B2C sales to customers in France, Quaderno applies the tax rate based on your business’s location.
If your business is based in Guyana or Mayotte, Quaderno would not automatically apply VAT on your B2C sales to customers in France.
 
B2C French DOM VAT cases
Seller
Buyer
Applicable rate
Metropolitan France or DOM
Rate applicable in mainland France
Metropolitan France or DOM
Rate applicable in the overseas departments
Metropolitan France or DOM
No VAT
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Certain B2C sales may be taxed at a rate based on the customer’s location. Please review the list here to see if this applies to you.

Summary

For B2B sales, VAT is usually applied based on the buyer’s location.
For B2C sales, VAT is usually applied based on the seller’s location.
When this place is Guyana or Mayotte, the service is not subject to tax.

FAQs

I made a sale for a client in New Caledonia. Why is there no VAT displayed on the invoice?
Sales to New Caledonia are tax-free. It is a territory outside the VAT zone.
 
If I am a seller in mainland France, do I apply VAT on digital product sales to DOM?
You should apply standard French VAT on digital products sales to DOM (except in Guyana or Mayotte, where VAT is not applicable.)  As we are not certified tax advisors or accountants, we always recommend consulting a professional tax advisor or the authorities.
If I am a seller from outside France, do I need to apply VAT on sales in DOM?
Only French businesses must collect taxes in their sales to DOM. Sellers in other ther countries don’t need to collect taxes in the DOM.
What are the default settings in Quaderno? Will Quaderno apply VAT on my sales in DOM if I add France as a jurisdiction?
If your main business address is in France and you’ve added France as a jurisdiction in Quaderno, tax will be calculated on sales to DOM. The DOM is included in the French jurisdiction.
How does Quaderno determine if a customer is located in a DOM?
For customers in France, Quaderno will automatically detect if your client enters a valid postal code from the DOM regions (and France as country). If you are selling digital products, some digital tax regulations require that you collect at least two pieces of non-conflicting location evidence for your customer. You can find more information here.
If I need to collect tax in the DOM, how can I add these to my Quaderno account?
You need to be registered for tax collection in France, then you can add France as a jurisdiction in your Quaderno account.