Make sure you’re ready for French VAT changes
Date published:
The Current Process:
CPC 42 (known as Regime 42) currently allows UK businesses selling DDP into the EU to bring their goods into France and immediately dispatch them to another EU country without paying import VAT or having to register for VAT in France. Instead, the VAT was declared in the destination EU state.
What is Changing?
From 1 January 2026, non-EU businesses can no longer use limited fiscal representatives in France. As such, UK businesses can no longer use a French fiscal representative under Regime 42 or take advantage of the Regime 42 easement.
Solutions:
There are a couple of potential solutions and options available for UK businesses:
- Obtain a French VAT registration and appoint a full fiscal representative
- Reroute via another EU member state (such as the Netherlands or Belgium). However, One off fiscal representative, like in France under regime 42, cannot be done in Netherlands or Belgium.
- Amend the Incoterms used to trade so you no longer offer Delivered Duty Paid (DDP)
- Establish distribution hubs inside the EU so that goods can clear customs once and can serve all of EU under one VAT number.
In the Netherlands, a general fiscal representative can be appointed to obtain a Dutch VAT number and you could benefit from Article 23 VAT deferment (Article 23 allows importers to declare import VAT on their VAT return instead of paying it upfront).
Belgium also does not allow one off fiscal representative but VAT deferment is possible using ET 14000 authorisation. Belgium will require non-EU businesses to appoint an accredited fiscal representative for VAT registration who will be jointly responsible for VAT debts. So not all providers offer it, but many international VAT firms do.
Risks to watch out for:
Vitally, make sure that your business is prepared in advance to the 1st January 2026 deadline. French VAT registration can take a number of weeks/ months to obtain and if you decide to go down this route, then make sure you understand how it will impact your businesses cash flow.
Finally, if you are not prepared, and do not communicate changes to your customers sufficiently, then you open yourself up to customs delays, penalties, and customer dissatisfaction.