Unpaid invoice in France - how to recover VAT?
The customer doesn't pay, but the French VAT on the sale has already been settled? Merely missing the payment deadline doesn't entitle you to a tax refund. First, you need to determine the status of the receivable and gather the appropriate documents.
We explain when a delay becomes definitive non-collectibility, what changes a judicial liquidation decision, and how to link a VAT correction to an invoice, a customer, and CA3.
An overdue invoice is not automatically uncollectible
There is no general French rule: 30, 60, 90, or 180 days after the deadline = VAT recovery. The internal accounting threshold does not replace evidence.
Invoice on time
The receivable exists; there is no basis for adjustment due to uncollectibility.
After the payment deadline
Delay alone is still not enough.
Doubtful receivable
Risk of non-payment or accounting write-off - still not enough.
Vindication
Its result and documents may demonstrate no real possibility of recovery.
Definitive uncollectibility
A documented lack of real possibility of recovering the debt (créance définitivement irrécouvrable) may justify a correction of previously settled VAT.
French VAT correction
Determine the net irrecoverable portion, the corresponding VAT, the required customer document and the correct accounting in CA3.
90 days after the deadline ≠ automatic VAT correction
Neither three reminders, nor a temporary lack of funds, nor a commercial dispute constitute definitive uncollectibility. The BOFiP (Bank and Financial Information Service) distinguishes unpaid receivables based on delays and accounting write-offs from documented uncollectibility. Judicial liquidation has a separate, earlier path—there's no need to go through this entire process.
Do you already have a basis for correcting French VAT?
The tool indicates an area for review. It does not confirm definitive tax default or entitlement to a tax refund.
First, check whether this VAT has been paid at all
Not every unpaid invoice includes VAT due, which the seller has already settled.
Commodity
VAT may have been due before the customer received the money. If it was correctly accounted for, the uncollectibility could trigger an adjustment analysis.
Service: Payment receipt
When settling based on payment receipts (encaissements), a complete failure to pay may mean that VAT has not yet become due. You cannot recover tax that has not been previously settled.
Service: VAT advance option
With the debit-by-debit option, VAT may have been settled before payment. In this case, the rules for bad debts may apply.
The invoice itself does not confirm the payment of VAT
Compare the document with the records, the due date, and the declaration. In the case of partial payments or advance payments, do not assume that VAT has been settled on the entire unpaid amount. For specific rules for pre-transaction payments, see the article "VAT on advance payments in France.
What is sufficient and what is not sufficient to constitute uncollectibility?
A doubtful receivable (créance douteuse) describes a risk. A definitely uncollectible receivable means there is a documented lack of realistic possibility of its collection.
| Situation | Is it enough on its own? | What to check? |
|---|---|---|
| 30, 90 or 180 days delay | NO | Evidence of actual uncollectibility, not just the calendar |
| Customer ignores reminders | NO | Outcome of further actions and possibilities of recovery |
| Formal demand for payment (mise en demeure) | Not automatically | This is a debt collection document, not proof of its ultimate failure |
| Allowance for doubtful receivables | NO | An accounting write-off does not in itself give the right to a VAT correction |
| Ineffective debt collection and no real recovery | Potentially | Complete set of evidence and tax formalities |
| The debtor disappeared without an address | Particular administrative practice | Documenting a disappearance; a separate exception to the formality of the document |
| Judicial liquidation ruling | Special early opportunity | Judgment, scope of debt and required formalities |
| Approved repayment plan | Only the right part | The amount that will remain unpaid according to the plan |
How to prove definitive uncollectibility?
There's no one-size-fits-all certification for every invoice. Evidence must demonstrate what was done and why the debt cannot realistically be recovered.
Actions towards the customer
Reminders, formal payment demands, correspondence, and collection agency materials. Keep dates and invoice links.
Result of the investigation
Documents of court proceedings, actions of the enforcement authority (commissaire de justice), unsuccessful enforcement or other relevant recovery attempts.
Debtor's situation
Documents relating to insolvency, liquidation, approved plan, or credit insurance. Explain their impact on the specific unpaid amount.
A final judgment after a full proceeding isn't always necessary. Proper documentation of the failure of the actions is crucial; compensation from credit insurance can confirm such an outcome. This doesn't mean that three emails are sufficient in every situation.
If the debtor disappears without leaving an address, retain evidence of the disappearance and any attempts to locate him. The administration provides for a special practice in this situation and a derogation from the formalities regarding the client's document.
A stolen check requires proof of this circumstance. In the case of a dishonored check, it is important to utilize legally mandated debt collection procedures—not simply return the check.
VAT and debt collection
A formal demand is a step, not an automatic basis for correction. Service Public describes the court order for payment and simplified debt recovery. From September 1, 2026, the order must be served within three months; for certain debts up to €5,000, a separate simplified procedure exists. Choosing the appropriate debt recovery path requires your own legal assessment.
Client liquidation: no need to wait until the proceedings are closed
In the case of judicial liquidation (liquidation judiciaire), French regulations allow for earlier recovery of VAT - from the date of the liquidation decision.
Court ruling
Judicial liquidation of a client
Amount subject to correction
Determine the unpaid portion of the invoice and VAT
Required formalities
Prepare a document for the client and keep the evidence
Possible correction
Without waiting for the liquidation to end
Example: €60,000 net
Goods: €60,000 net + €12,000 VAT. The sale was correctly recorded in CA3, but the customer failed to pay, and the court ordered liquidation. After completing the formalities, a €12,000 VAT adjustment is possible.
Don't confuse the opening of proceedings
The initiation of restructuring is not a liquidation order. The mere status of a "company in difficulty" does not automatically entitle a company to recover all VAT.
Liquidation ruling, not just lack of assets
A special early option is confirmed by Article 272 of the Code of Civil Procedure. You still need to check the previous VAT settlement, amount, and formalities. Don't skip these just because the client is in liquidation.
Restructuring: the adjustment concerns the unrecoverable part
In judicial restructuring (redressement judiciaire), what matters is the approved plan and the part of the debt that will remain unpaid – not the mere opening of the proceedings.
Invoice
EUR 100,000 net + EUR 20,000 VAT
Approved plan
60% paid; 40% definitively written off
Unrecoverable part
40,000 EUR net
VAT for analysis
8,000 EUR, not the full 20,000 EUR
Not every deferred payment is uncollectible. Separate the portion due later from that which will not be collected according to the plan. Keep the ruling approving the plan and the calculation for the specific invoice.
Special rules may also include definitive write-offs in settlement (conciliation) or protective proceedings (sauvegarde). In the case of a "pay 60%, we'll write off the rest" agreement, determine its nature: a price reduction, settlement, or debt write-off are not always classic debt defaults. The buyer must also adjust the deduction accordingly.
What document should I give to the client?
If a debt is uncollectible, it may still exist. Don't issue a simple credit note (avoir) for zero just because a customer doesn't pay.
Duplicate of the original invoice
While maintaining the required data and clearly stating the unpaid net amount, the corresponding VAT and the lack of right to deduct this part of the tax.
List of unpaid invoices
For each invoice: number, description, and date, net amount, VAT, and required information about non-payment and lack of deduction rights. Keep a copy for your records.
| Element | Illustration |
|---|---|
| Original invoice | The number, date and its required data remain preserved |
| Unpaid net portion | 4,000 EUR |
| VAT-equivalent | 800 EUR |
| Clear information | The indicated part remained unpaid; the VAT relating to it cannot be deducted by the debtor |
| Commercial importance | Tax documentation does not automatically mean debt relief |
Apply the required French formula before shipping
The above diagram clarifies the data but does not replace the precise annotation provided by BOFiP for duplicate or summary unpaid invoices. Do not send only the Polish abbreviation as a finished tax document. General requirements are described separately: VAT invoice in France.
When a debtor's disappearance is documented without an address, the administration provides an exception to the formality of correcting the original document. Keep evidence of this special situation—don't assume that a lack of response to a message means the client has disappeared.
The seller recovers the VAT, the customer corrects the deduction
If the buyer has previously deducted VAT, receiving the correct duplicate or statement requires an appropriate correction of this deduction.
Seller
It documents the correct basis, submits the required document and corrects the previously settled VAT to the extent of the uncollectibility.
Client
After receiving the document, he does not retain the previous VAT deduction attributable to the indicated unpaid part.
Tax correction does not cancel the claim for payment
Separate VAT settlement from the civil law existence of the debt. Unless actual write-off or other legal event has occurred, a tax duplicate does not mean that the customer no longer owes anything.
How to include recoverable VAT in CA3?
Keep the sequence: original sale → VAT due → basis for uncollectibility → required document → tax regularization.
Sales and VAT
Confirm invoice and prior settlement
Basis for correction
Evidence of uncollectibility or relevant judgment
Tax document
Duplicate or collation; proper exception separately
CA3 and archive
Appropriate inclusion and full linking of documents
For taxpayers in the real-world system, BOFiP indicates the recoverable VAT in Part B of the 3310-CA3 declaration. Use the regularization field appropriate to the current version of the form and the specific situation.
Don't delete sales from historical records, don't change invoices as if the sales never happened, and don't create fictitious negative transactions. In the case of an unpaid receivable, a tax correction doesn't automatically cancel the sales.
The general structure of the form and declaration is described in the VAT Declarations in France. The starting point here is only the VAT on the bad debt, not the product return or standard price adjustment. If the adjustment settlement is subject to an audit, the preparation of documents and the response to the authority's findings are described in the VAT Audit Guide in France. The documentation should allow for tracing both the original tax and the basis for its recovery.
Calculate the VAT attributable to the net irrecoverable part
Example: Invoice €10,000 net + €2,000 VAT. €6,000 net and the corresponding VAT were paid. €4,000 net definitely uncollectible means a correction of €800, not the full €2,000.
Subsequent payment requires re-billing
If the customer does pay in full or in part, VAT must be accounted for accordingly on the recovered portion of the price. Link the invoice, the uncollectible adjustment, and subsequent receipts. Don't remove a debt from your trading system simply because the VAT has been adjusted.
Factoring and insurance: who corrects VAT?
Payment by an insurer or the acquisition of a receivable by a factor requires verification of the contract and document flow.
Credit insurance
Compensation after failure of appropriate debt collection efforts may confirm uncollectibility. Check the policy's coverage, assignment of receivables, and the method of loss settlement.
Factoring
The seller remains the primary VAT payer on the sale. The factor provides evidence of unsuccessful debt collection; the seller makes appropriate adjustments. Any remittance of recovered VAT to the factor is subject to the agreement.
For services billed by payment receipt, don't automatically assume that recoverable VAT has already been incurred. With the debit-based billing option, the situation may be different. Always refer to the due date and the actual tax settled.
Uncollectibility, goods return and input VAT are different matters
What counts is the VAT previously settled in France by the seller, not the customer's nationality or the company's registered office.
Sales with French VAT
The Polish company correctly accounted for €50,000 net + €10,000 VAT in CA3. Documented definitive irrecoverability may allow for the recovery of €10,000 after formalities.
Reverse charge
On a €10,000 reverse charge (autoliquidation) invoice, the seller failed to account for €2,000 of his own French VAT. This tax is not recoverable.
VAT of another country in OSS
A FR → DE consumer sale with German VAT settled in the OSS does not result in a French VAT correction in CA3 due to non-payment. Evaluate the OSS and the law of the country of consumption.
Don't move other procedures here
With IDT exempt from French VAT, the seller also doesn't have the same output VAT to recover. Broader rules apply to the reverse charge in France. The actual cancellation of a sale or the physical return of a product is described as a French VAT return. However, a VAT refund from France on purchases concerns a different purpose: input VAT, not an unpaid sales invoice.
A trade dispute does not provide a correction on its own
Determine whether, and how much, the customer is actually obligated to pay. If the parties reduced the price or canceled the transaction, it may be a price adjustment rather than a bad debt.
From when is the correction deadline counted?
The point of reference is the determination of definitive uncollectibility, with a separate earlier possibility of judicial liquidation.
Liquidation ruling
Early corrections are possible from the date the client's bankruptcy is adjudicated. You don't have to wait for the proceedings to conclude.
Closure for lack of assets
BOFiP indicates that in the event of a ruling closing the liquidation due to insufficient assets, correction is possible until 31 December of the second year following the year of that ruling.
Don't automatically calculate this period from the invoice issue date or payment date. Identify the event and evidence that triggers the right to correction. Once you have them, organize your documents, customer notification, declaration, and accounting—no unnecessary delays.
From 1 January 2027, the location of the provisions changes
For settlements in 2026, Article 272 of the CGI remains the basis. The recodification transfers the basic VAT rules to the CIBS from 1 January 2027.
2026: Article 272 CGI
VAT recovery in the event of a definitively uncollectible debt and a special earlier possibility in the event of a judicial liquidation decision.
From January 1, 2027: art. L213-70 CIBS
A definitively uncollectible portion of the consideration due is treated as a price reduction for tax purposes. Any properly determined portion of the receivable is significant.
Do not use the old date of September 1, 2026.
The postponement results from Article 17 of Legislative Decree No. 2026-671 of 27 July 2026.The new structure is contained in Article L213-70 of the CIBS. This does not automatically mean a civil debt write-off. The transitional provisions also provide for the retention of the specific paragraph of Article 272 on liquidation until it is taken over by the relevant implementing legislation.
Ten assumptions worth checking before correction
Expand the selected assumption.
1. "90 days past the due date is enough"
The passage of time alone does not give rise to the right to recover French VAT.
2. "The accounting write-off confirms the uncollectibility"
The allowance for doubtful receivables describes the risk. Definitive uncollectibility must be demonstrated.
3. "One payment request solves the problem"
A formal summons is proof of action, not automatic proof of ultimate failure to recover.
4. "When liquidating, you have to wait until it is finished"
A special possibility of correction exists from the date of the judicial liquidation decision.
5. "A zero credit note is enough"
In the event of a default, the debt may still exist. A required duplicate or statement is used, rather than a fictitious cancellation of the sale.
6. "The customer keeps his deductible"
After receiving the appropriate document, he should correct the previously deducted VAT relating to the indicated part.
7. "Every unpaid service has VAT to recover"
When settling according to payment receipt, a complete lack of payments may mean that VAT has not become due.
8. "The reverse charge allows the seller to recover VAT"
No, if the buyer settled the French VAT and the seller did not settle his own output tax.
9. "I correct WDT and OSS the same way in CA3"
First, determine where and by whom the tax was settled. Don't automatically transfer another country's adjustment to CA3.
10. "Recovering VAT eliminates debt"
Tax adjustments and the existence of receivables are separate issues. Subsequent payment requires a VAT reassessment.
Checklist before VAT correction on bad debts
Mark items after checking them. A complete set of marks does not constitute confirmation of the right to make corrections.
The customer has not paid and the French VAT has already been settled?
We'll review previous tax settlements, the status of receivables, and any documents needed for corrections. We'll reconcile the uncollectible portion of the invoice with the appropriate CA3 regularization and subsequent client payments.
Unpaid invoice in France - questions about VAT recovery
Can you recover VAT on an unpaid invoice in France?
Yes, if the VAT has already been settled and the receivable has become definitively uncollectible, or if a special situation exists, such as a court-ordered liquidation. The appropriate formalities must be completed.
After how many days can VAT be recovered?
There is no general rule of 30, 90, or 180 days. The passage of time alone is not enough.
Is a payment demand sufficient?
Not automatically. The summons documents debt collection activity, but does not itself indicate definitive uncollectibility.
Is an allowance for doubtful receivables sufficient?
No. The accounting write-off does not in itself give the right to recover French VAT.
When is a receivable definitely uncollectible?
When circumstances and documents indicate the failure of appropriate actions and the lack of a real possibility of recovering the debt.
When can VAT be recovered in the event of a client's judicial liquidation?
A special earlier possibility exists from the date of the judicial liquidation decision, after the appropriate formalities have been completed.
Do I have to wait until the liquidation is completed?
No, if you are taking advantage of a special opportunity arising from a judicial liquidation order.
What about the client's judicial restructuring?
What matters is the approved plan and the portion of the receivable that will remain unpaid under it. Simply initiating restructuring is not sufficient to correct the entire invoice.
Do I need to cancel the original invoice?
This is not the case with classic default. The debt may still exist, and the BOFiP provides for a separate tax document.
What document should I give to the client?
In principle, a duplicate of the original invoice with the required information on the unpaid net amount corresponding to VAT and the lack of the right to deduct, or an appropriate summary of invoices.
What does the customer do with the previously deducted VAT?
After receiving the appropriate document, he should correct the deduction relating to the indicated unpaid part.
Is it possible to recover part of the VAT?
Yes. The correction applies to the VAT attributable to the correctly determined uncollectible portion of the remuneration, not automatically the entire tax on the invoice.
Does an unpaid service always result in VAT being recovered?
No. In the case of VAT payable as payment is received, a complete lack of payment may mean that no recoverable tax has previously been incurred.
Does the reverse charge work the same for the seller?
No, if the French VAT was settled by the buyer and the seller did not settle it as his own output tax.
What changes from 2027?
From 1 January 2027, the basic VAT provisions are being recodified in the CIBS. Article L213-70 treats the definitively irrecoverable part of the consideration as a tax reduction of the price.
This article is for informational purposes only. The right to correction requires an assessment of the transaction, tax due date and early settlement, uncollectibility, documents, and deadlines. The qualifier indicates the areas to be checked, while the calculator only calculates the amount. Neither tool confirms the right to a VAT recovery.
