VAT and taxes

VAT is in principle due at the place of consumption: for a sale to a foreign private individual, it is most often the State of destination that applies its tax, on import. For a sale between professionals, a reverse-charge mechanism avoids double taxation.

On import, VAT is due when the work enters, on the customs value, to which any duties are added. It is recoverable if the buyer is a taxable person who resells the work or uses it for their business.

In many States, art dealers and auction houses may apply the margin scheme: VAT applies only to the difference between the selling price and the purchase price. It is advantageous for second-hand goods, but prevents the professional buyer from recovering the tax.

Specific taxes also exist: taxes on auction sales, resale rights, local taxes. They are added to VAT and must be included in the calculation of the total price.

Three mistakes come up most often. The first is to ignore the VAT of the State of destination in an online sale. The second is to invoice without tax without proof of exit from the territory, which exposes you to a reassessment. The third is to mix the standard regime and the margin scheme on a single invoice.

A simple check before every sale abroad avoids most of these mistakes: verify the country of delivery, the status of the buyer and the applicable regime.