Renovations - Pay 14.1% Less

In France VAT (Value Added Tax, or sales tax) is known as TVA (Taxe à la Value Ajouté) and it works much the same way as in the UK.

The standard rate for TVA is 19.6%, but as in the UK certain items are taxed at a lower rate. For example, some food items are taxed at only 5.5%.

In the case of renovations on your home, if you purchase the materials on their own you pay tax at 19.6% but if you purchase them in combination with professional services you pay tax at the reduced rate of 5.5%. You save 14.1% simply by ordering the labour at the same time as the materials.

To illustrate the advantages of this, I recently had a plumber charge me 20 euros to install a 200 euro radiator. If I had purchased the radiators and installed them myself it would have cost 239.2 euros (200 euros at 19.6% tax) whereas having a professional plumber do the work it was only 232.1 euros (220 euros at 5.5%). It was cheaper to have a professional do the work than to do it myself!

This 14.1% saving is available on most products that you would buy for your home. However, before making any decisions on this basis you should check that:

• The person doing the work is a registered professional (he should give you his registration number, which in France is know as a SIRET number).

• The work is eligible for the reduced rate. Almost all work on a house more than 2 years old is eligible, but there are a few restrictions (which change from time to time). The best way to check is to have the professional do an estimate (known in France as a devis) for the work, quoting you a tax rate of 5.5%.

• The professional is charging you the same price (or less, given his trade discount) for the materials than if you were purchasing them yourself.