Sanremo 1st March 2017.
Please find hereby the info just released by our French partner: As you are aware, it has been EASYTAX policy since July 15, 2013, when the VAT became applicable to charter hire in France, to include any Delivery/Re-delivery fees charged to the charterer into the taxable base. This approach was based on Article 267 of the French Tax Code, which considers Delivery/Re-delivery fees as an ancillary service to the main service. Therefore this ancillary service should be treated the same way tax-wise. Over the years, there has been some confusion within the industry on this matter, with various positions taken. As a result, several of our partners have asked that we seek confirmation from the French Tax Administration on this particular point – which we did.
Some time ago, we had requested for a legal ruling from the French Tax Administration Rules and Regulations Division (“Département de Legislation Française”) to confirm the taxable regime to be applied to Delivery/Re-delivery fees. Recently, we received the ruling (Ref. D2B/1500014757D) that confirmed that such fees – regardless if they are just fuel &/or “a time package” – charged in order to put a vessel at the charterer’s disposal, EITHER before the charter from one port to another OR after the charter to reposition the vessel, are indeed constitutive of an ancillary service to the main service, and therefore are taxable under the same condition.
To quickly summarize: DELIVERY/REDELIVERY FEES ARE TAXABLE IN FRANCE
1. If the charter fees are taxed at 20% French VAT, the delivery/re-delivery fees are taxed at 20%
2. If the charter fees are taxed at 20% French VAT on 50% of the charter fees, the delivery/re-delivery fees are taxed at 20% French VAT on 50%.