End of the Simplified VAT Regime in 2027: What Changes for Your Business
The simplified VAT regime disappears in France on 1 January 2027. If your business files one annual CA12 return and pays two VAT instalments a year, this reform changes your routine. You will report the VAT you actually owe during the year, on monthly or quarterly CA3 returns.
The switch is automatic, so you do not need to apply. However, it affects your bookkeeping, your cash flow and your calendar. This guide explains who is concerned and how to prepare.
In brief
- The simplified VAT regime ends on 1 January 2027.
- The annual CA12 gives way to monthly or quarterly CA3 returns.
- The switch is automatic, but it changes your cash flow and bookkeeping.
What Is Changing With the Simplified VAT Regime?
Article 38 of the 2025 Finance Act abolishes the simplified VAT regime from 1 January 2027. Until now, businesses under this regime have paid two instalments, in July and December, and then settled the balance on an annual CA12 return.
| Topic | Until the end of 2026 | From 2027 |
|---|---|---|
| Return | One annual CA12 | CA3, monthly or quarterly |
| Payments | Two instalments, then a balance | VAT actually due for each period |
| Follow-up | Once a year | Throughout the year |
In short, annual regularisation gives way to regular reporting. As a result, your accounts need to stay up to date all year.
Who Is Affected by the End of the Simplified VAT Regime?
The reform concerns businesses and associations currently under the simplified VAT regime. They move to the normal regime automatically.
Two groups keep their current position:
- businesses under the VAT exemption threshold (franchise en base), as long as they qualify;
- farmers under the simplified agricultural regime.
The reform also applies only to VAT. Simplified regimes for other taxes remain in place. Foreign-owned French companies should check their position too, because many small subsidiaries use this regime. If your company is only registered for VAT in France, see our guide to French VAT registration.
Monthly or Quarterly CA3 Returns?
Quarterly filing applies when your turnover, including taxable acquisitions, does not exceed:
- €1 million for the previous calendar year;
- €1.1 million for the current year.
Above these limits, monthly filing applies. You may also choose monthly returns by contacting your tax office, for at least four quarters. For example, a business that regularly claims VAT credits may prefer this option. The tax authorities use the turnover on your last annual return to set your frequency.
Key Dates for Leaving the Simplified VAT Regime
- December 2026: last instalment for businesses with a calendar year.
- January 2027: first period covered by a monthly CA3.
- First quarter of 2027: first period covered by a quarterly CA3.
- 4 May 2027: deadline for the final CA12 for a year ending on 31 December 2026.
Note that the final CA12 and the corporate tax return share the same date. Our calendar of French corporate tax return deadlines sets out the other dates.
If Your Financial Year Does Not End on 31 December
You stay under the simplified VAT regime until the end of the financial year that includes 31 December 2026. Your first CA3 then covers the first month or quarter after that year-end. In addition, a July 2027 instalment may still apply in some cases, for instance when the year ends between July and November 2027. Check this date with your accountant.
What the Reform Means for Your Cash Flow
Instalments based on the previous year are predictable. By contrast, CA3 payments follow your real activity, so they rise and fall with your sales. A strong quarter therefore means a larger VAT payment soon afterwards.
Seasonal businesses should plan for this first. On the other hand, a business with falling sales may pay less than it would have paid in instalments.
How to Prepare Before January 2027
- Confirm your filing frequency. Compare your turnover with the thresholds.
- Update your bookkeeping routine. Record sales and purchases at least monthly.
- Reconcile your VAT. Check that your accounts match your declared turnover before the final CA12.
- Forecast your payments. Set money aside for each period.
- Check your software. Make sure it produces CA3 data correctly.
- Tell your e-invoicing platform. Your reporting frequency depends on your VAT regime, so read our guide to the e-invoicing reform.
For the basics of filing, see declaring and paying VAT in France or the French tax authorities’ website.
Frequently Asked Questions
Do I need to do anything to leave the simplified VAT regime?
No. The tax authorities make the change automatically. However, you should still confirm your filing frequency.
Will the CA12 disappear completely?
Yes, after your final return. Businesses concerned then use CA3 returns.
Does the end of the simplified VAT regime increase my VAT?
No. The reform changes when you report and pay, not the VAT rates.
Move to CA3 Returns With Confidence
A change in VAT routine is easier when your figures are ready in advance. ESCEC International helps entrepreneurs and foreign-owned companies organise their accounting and VAT in English.
Currently under the simplified VAT regime?
Book a session with an ESCEC International expert to review your filing frequency, your cash flow and your 2027 calendar.
This article gives general information as of November 2026 and does not replace advice on your specific situation.
