VAT business representation France deductible

Representation and entertainment often excluded in France

Costs for representation, entertainment and luxury generally fall outside VAT refund in France, in the same way as for entrepreneurs established in France itself. A refund country may apply its own national restrictions on the right to deduction to requests from foreign entrepreneurs, as long as those restrictions are no stricter than what applies to domestic entrepreneurs. For the ten EU cost categories into which expenses are divided — including the category covering representation and entertainment — this means that France can determine per cost category whether, and to what extent, refund is possible. This can differ per cost category: while a hotel stay for a business trip usually qualifies, this is more nuanced for a meal with a business relation or an outing for customers.

In the classification of receipts, each expense is linked to one of the ten EU cost categories and tested against what the refund country — in this case France — permits for it. Expenses classified as representation, entertainment or luxury therefore do not automatically go into a request: first it is checked whether France (partially) excludes this category. An indication from the calculator already takes this into account by weighing such costs cautiously, but the final