5th april 2024
Article 286 sexies of the French Tax Code, transposing Directive (EU) 2020/284 of 18 February 2020 (known as the "CESOP" Directive), introduces an obligation for certain payment service providers ("PSPs") to keep and transmit a detailed register when, during a calendar quarter, they provide payment services corresponding to more than twenty-five cross-border payments intended for the same beneficiary.
This system came into force in France on 1st January 2024, and will give EU Member States access to information on payments, making it easier to detect VAT frauds.
FIRST REPORTING DEADLINE: 30TH APRIL 2024
The information contained in the register must be collected and transmitted by the end of the month following the related quarter at the latest.
The first return for the 1st quarter of 2024 (i.e. from January to March) must therefore be sent via the "impots.gouv.fr" portal by 30th of April 2024 at the latest. This electronic transmission will only be possible from 1st April 2024, when the portal opens.
Failure to transmit information within the prescribed time limits and inaccuracies or omissions in the register will result in a fine of 15 euros per payment not declared or declared late or per inaccuracy, up to a limit of 500,000 euros per payment service provider and per calendar quarter to which the information relates.
Although this fine does not apply to a first offence that has been put right, future reporting deadlines must be met promptly.
DETAILS OF THE FILING PROCEDURE
Payment service providers covered by the reporting obligation must transmit the information contained in the register electronically in XML format.
In this context, the tax authorities have issued extremely detailed specifications providing further practical details on the IT procedures for compiling and filing CESOP returns, including examples of file filing scenarios and details of the following procedures:
- Data transmission, particularly with regard to file naming rules, the controls applied by the DGFiP, the case of "nil" returns and amending returns.
- Automated sending of files by the DGFiP to a European Commission register in XML format. It should be noted that the DGFIP is not authorised to modify the payment data, and only retransmits the payment data received from the PSPs to the CESOP system.
- Retrieval of business reports (CRM) / "message status" reporting on the validation of transmitted files by the DGFiP and the EU.
These details are supplemented by a "User Manual" validation module.
REGISTRATION REQUIREMENT FOR NON-RESIDENT PSPS
To file the quarterly register, PSPs must log on to their professional area used to file their declarations: Declare > Cross-border payments - CESOP.
Particular attention should be paid to non-resident PSPs (registered outside France but providing payment services in France, via a European passport for example) who do not have a SIREN number (the identifier needed to create a professional space).
In order to obtain this identifier, these non-resident PSPs will have to register with the Non-Residents' Tax Department (Direction des Impôts des Non Résidents”) by submitting the "EEO" form, accompanied, where appropriate, by additional documents relating in particular to the activity carried out.
KPMG Avocats' Indirect Tax and Tax Technology team brings together experts in financial services and data analysis to support you at every stage of implementing this obligation: (i) defining the operators concerned and (ii) the flows to be declared, (iii) extracting the data, (iv) preparing the files in the required format or filing or registering foreign PSPs.
