VAT Reverse Charge: 🇱🇻 Latvia to 🇫🇷 France

Yes. When a VAT-registered business in Latvia supplies B2B services to a VAT-registered business in France, the reverse charge mechanism applies under Article 196 of EU VAT Directive 2006/112/EC. The Latvia supplier invoices at 0% VAT, and the France customer self-accounts for VAT at their local rate of 20%.

If the customer is VAT-registered, put 0% VAT on the invoice. You must include the customer's France VAT number and the note: "VAT reverse charge — Article 196, Directive 2006/112/EC". Do not charge Latvia VAT (21%) on cross-border B2B service invoices.

The standard VAT rate in France is 20%. When reverse charge applies, the France customer declares 20% VAT in their local VAT return and simultaneously deducts it as input VAT — so the net cash effect is zero for a fully VAT-registered business.

Yes. You must report cross-border B2B services in your EC Sales List (ESL), also known as VIES or Recapitulative Statement. Report these as services (not goods) using the customer's France VAT number. Filing frequency depends on Latvia's local rules — typically monthly or quarterly.

If the customer in France does not have a VAT number, reverse charge does not apply. For B2C supplies or non-registered businesses, different rules apply. For most services, you would charge Latvia VAT (21%). For digital/electronically supplied services, France VAT (20%) may apply via the EU One Stop Shop (OSS) scheme.

Verify the customer's VAT number using the EU VIES system at ec.europa.eu/taxation_customs/vies before issuing a zero-rated invoice. France VAT numbers start with the prefix "FR". Keep a record of the VIES confirmation for your audit trail.

Reverse charge under Article 196 applies to most B2B services where the place of supply is the customer's country. Some services have special rules — for example, services related to immovable property are taxed where the property is located, and short-term vehicle hire has specific rules. For standard professional, consulting, digital, and software services between Latvia and France, reverse charge applies.

Your invoice must include: (1) Your Latvia VAT number, (2) The customer's France VAT number, (3) 0% VAT / VAT amount: 0.00, and (4) The legal reference: "Reverse charge — Article 196, Council Directive 2006/112/EC". Some suppliers also add the France equivalent note in French: "Autoliquidation de la TVA".