VAT recovery on expense reports: the guide
A significant share of the VAT recoverable on expense reports is never claimed — non-compliant receipts, misapplied deductibility rules, small amounts abandoned for lack of time. This guide summarizes the rules by expense category (French rules, with EU-wide principles), receipt compliance requirements and the automation levers.
Deductibility rules by expense category
Fuel
In France, deductibility depends on the fuel and vehicle type: diesel and petrol are 80% deductible for passenger cars and 100% for commercial vehicles; electricity is 100% deductible. Every fill-up must be allocated to the vehicle used.
Meals
VAT on business meals is recoverable when the expense serves the business and is backed by a compliant invoice. Beware multi-rate bills: in France, 10% dine-in, 5.5% takeaway, 20% on alcohol — line-by-line breakdown determines the recoverable amount.
Accommodation
A classic trap: in France, VAT on an employee's or executive's hotel stay is not recoverable; it is recoverable for third parties (clients, suppliers). Breakfast invoiced separately follows the meal rules.
Tolls, parking, car rental
VAT on tolls is recoverable with a compliant receipt; parking VAT is recoverable when tied to business activity. For car rentals, deductibility follows the vehicle rule (passenger vs commercial).
No compliant receipt, no recoverable VAT
Receipt compliance is the first condition of deduction. In a tax audit, VAT deducted on a non-compliant receipt is rejected — with late-payment interest. What to check on every document:
- Invoice in the company name (mandatory above €150 excl. VAT in France) — a simple till receipt is no longer enough.
- Mandatory mentions: supplier identity, intra-EU VAT number, date, breakdown of VAT rates and amounts.
- Consistency between the applied rate, the amount and the nature of the expense.
- Legibility and integrity of the document (an illegible or truncated receipt can be rejected in an audit).
- Match between the receipt and the declared expense (amount, date, location).
Multi-country VAT: the forgotten reserve
For companies whose employees travel across Europe, VAT paid abroad (hotels in Germany, trade shows in Italy, fuel in Spain…) is recoverable through the intra-EU refund procedure — but each country applies its own rates and deductibility rules. Without tooling, this VAT is massively abandoned.
The spread of e-invoicing across Europe (the French 2026 reform, SdI in Italy, KSeF in Poland) progressively structures VAT data at the source and makes it automatable — for companies that are equipped.
Automate with MULTI TVA
MULTI TVA by TEVASOFT automatically applies all of these rules to 100% of your expense reports: multi-rate breakdown, deductibility by category and by vehicle, receipt compliance checks, and identification of the recoverable VAT reserve — including retroactively over your last 12 months. Compatible with SAP Concur, N2F, Lucca and Cegid.
Frequently asked questions
Why is so much VAT lost on expense reports?+
Three causes dominate: non-compliant receipts (a till receipt instead of an invoice, missing mentions), complex and misapplied deductibility rules (fuel, accommodation, multi-rate), and the cost of manual processing, which pushes teams to give up on small amounts — whose accumulation nevertheless represents significant sums.
Can VAT paid in another European country be recovered?+
Yes, through the electronic intra-EU refund procedure (the "8th Directive"): VAT paid on business expenses in another member state (hotels, trade shows, fuel…) can be refunded, under the deductibility rules of the country where the expense was incurred. The procedure is declarative and requires compliant receipts.
What does the 2026 e-invoicing reform change for VAT on expenses?+
From September 2026, invoices for business expenses ≥ €150 excl. VAT in France must be structured electronic invoices (Factur-X, UBL, CII) received through a certified platform. VAT data will be structured at the source, which makes recovery more reliable — provided each e-invoice is reconciled with the matching expense line.
How does MULTI TVA automate this recovery?+
MULTI TVA breaks down every receipt at the right rate, applies French and European deductibility rules by expense category, checks receipt compliance (mentions, €150 threshold, integrity) and identifies recoverable VAT — including across your last 12 months of history.
Go further
How much VAT are you leaving on the table?
Request a free audit of the recoverable VAT reserve in your last 12 months of expense reports.
Request a MULTI TVA audit