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Illegal, illogical or both ?


Iceni

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My friendly builder (English but reg in France) buys materials paying 19.6% TVA and then sells them to me with no markup adding just 5.5% TVA. He has been advised by his accountant that this is illegal - the addition of just a few euros will make M Fisc a happy bunny. 

Probably not relevant to many but I thought I would let you know.

John

not

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Its illegal because the low rate TVA is only applicable to a maintenance job done by registered artisan.

The supply of goods alone, or non-maintenance work is always at the higher rate.

Your friend risks a significant penalty if detected, which could also apply if he has been hiding your goods in other low rated jobs. It may also provoke a more detailed investigation if they suspect that he is in someway linked the black economy.

On that note Happy New Year.

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John,

As the previous poster has pointed out, this is illegal - also what is in it for your builder unless there are other issues involved.

Presumably he provides you with an invoice with a TVA number and you pay with a French Euro cheque.

To provide you with cheaper materials he is leaving himself out of pocket until he gets a refund from the Impots.

The whole point of the reduced rate of TVA was to encourage the building/renovation industry in France by allowing artisans to invoice qualifying work at 5.5% TVA.

If I purchase a kitchen from Lapeyre at 19.6% TVA, I can then invoice it to my client at 5.5% TVA as part of a complete installation. This has to be a realistic amount and not a 'few Euros'.

There always seems to be people that want to beat the system - eventually the Impot will pick them up!

Kind regards,

Bob Clarke
http://perso.wanadoo.fr/grindoux

 

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