"On this job, do I apply 10% or 20% VAT?" — that's the question 4 in 10 trades ask themselves every week in France. It's also the first error flagged by tax inspectors: misapplied VAT auto-reclassifies to the standard rate, at your expense, plus penalties.

Good news: the rules are clear once you know them. Here's the practical 2026 guide for reduced VAT on renovation in France (10% standard / 5.5% energy) and a brief overview of the UK equivalent (5% on specific works).

The 3 cumulative conditions for reduced VAT (FR)

For a job to qualify for the 10% reduced rate in France, the 3 conditions below must be met simultaneously. If any one is missing, the job goes back to standard 20% VAT.

1. The property must be over 2 years old

The clock runs from the quote date (not the work completion date). For a new dwelling delivered on 15 June 2024, you can apply 10% VAT from 16 June 2026 onwards. Before: 20% VAT mandatory.

How to prove the property's age? The signed simplified attestation is enough in most cases. If in doubt, ask for a council-tax statement, a deed, or energy bills more than 2 years old.

2. The property must be residential

Primary or secondary residence, owner-occupied or rented, doesn't matter: the use must be exclusively or principally (>50% of the floor area) residential. Mixed-use properties (residential + business) qualify for 10% only on the residential portion.

3. Works must be improvement, transformation, fit-out, or maintenance

This category covers most classic renovation work: painting, plumbing, electrical (excluding heavy code-compliance work), carpentry, tiling, interior fit-out. Rule of thumb: if the job creates neither new habitable surface area nor new structural framing, you're eligible.

Absolute exclusions: these jobs always stay at standard VAT

  • New build (vacant land) or full reconstruction after demolition
  • Extensions over 9 m² of new habitable area, or any increase over 10% of the original floor area
  • Works that change the building's nature: converting commercial to residential, merging two flats, etc.
  • New external equipment unrelated to the dwelling: pool, separate garage, garden shed, oversized terrace

When to apply 5.5% energy VAT instead of 10% (FR)

The 5.5% rate covers energy-performance improvements only:

  • Thermal insulation (roof, walls, floors, double-glazed windows)
  • Heating and hot water equipment with high energy performance: condensing gas boiler, heat pump, heat-pump water heater, biomass boiler
  • Heating regulation and programming systems

Same cumulative conditions as the 10% rate (property over 2 years old, residential), plus a technical condition: the equipment must meet performance specs set by decree (CGI article 200 quater). In practice, look for energy-class A or B and labels like NF PAC, RGE Éco-artisan or equivalent.

UK context: 5% reduced VAT (briefly)

In the UK, residential refurbishment generally falls under standard 20% VAT, with reductions to 5% only in specific cases:

  • Energy-saving materials installed in domestic property (insulation, draught stripping, central heating controls, solar panels)
  • Conversion of a non-residential building into a dwelling, or alterations to a listed building used as a dwelling
  • Properties empty for 2+ years being brought back into use

Always check HMRC's Notice 708 for current reduced-rate categories. The simplified attestation is FR-specific — in the UK, the burden of proof falls on the trader to demonstrate the work qualifies, with documentation kept for 6 years.

The simplified attestation: why and how (FR)

It's the central document. Without a simplified attestation signed by the client before work starts, French tax authorities can reclassify the job to standard 20% VAT, at your expense.

The simplified attestation (Cerfa 1300 SD or its digital equivalent) fits on one page: the client confirms the property's age, residential use, and nature of work. You keep it for 5 years with the quote. For jobs under €300 inc. VAT, the attestation isn't mandatory but still recommended.

Penalties for misapplication

Applying reduced VAT without justification (missing attestation, conditions not met) leads to:

  1. Reclaim of the VAT difference (10 to 14.5 percentage points) at your expense — non-recoverable from the client.
  2. Minimum 10% surcharge (40% for deliberate breach, 80% for fraud).
  3. Interest at 0.20% per month.

Concretely, on a misclassified €10,000 job, the reassessment can hit €1,500 to €2,500. That's the prime reason the simplified attestation should be systematic and archived for 5 years with the quote.