VAT in one minute
VAT (TVA in French) is a consumption tax that the business collects on behalf of the Treasury. You add it to the pre-tax price of your sales (output VAT), you subtract the VAT your suppliers charged you (input VAT), and you pay over the difference each month. Handled properly, the end customer bears it and your margin stays intact. Handled badly, it turns into a debt that builds up quickly.
- standard rate, the default
- 19%
- reduced rate, for goods and services listed in the CTCA
- 9%
- deadline for the previous month's G n°50
- the 20th
- IFU threshold, below which an individual does not charge VAT
- 8,000,000 DA
Who is liable for VAT?
According to the DGI (tax administration), VAT applies to transactions arising from an industrial, commercial or craft activity carried out by a taxable person, regularly or occasionally. Services are also covered. For the liberal professions, the DGI states that the standard rate applies, with some services such as medical procedures falling under the reduced rate.
In practice, what decides whether you charge VAT is your tax regime. Find your line:
| Your situation | VAT | What it means |
|---|---|---|
| SARL, EURL, SPA (any company) | Liable | Charges VAT, deducts it on purchases, files a G n°50 every month |
| Individual under the real regime (above 8,000,000 DA or by option) | Liable | Same obligations as a company |
| Taxpayer under the simplified regime | Liable | Charges and declares VAT, online since 2026 |
| Individual under the IFU | Not liable | No VAT on invoices, no recovery on purchases |
| Exporter | Exports exempt | No VAT on export sales, purchases free of VAT possible under conditions |
The IFU case
For the individuals it covers, the IFU replaces income tax on the business and VAT. Your invoices therefore show no VAT, and the VAT you pay your suppliers stays with you: it is part of your costs. This is one reason why some entrepreneurs opt for the real regime, especially when their customers are businesses that want to recover VAT.
The two rates: 19% and 9%
The 19% standard rate is the rule: if your product or service is not on the reduced-rate list, 19% applies. The 9% reduced rate covers the goods and services listed in article 23 of the CTCA. This list often changes from one finance law to the next, and the 2026 Finance Law amended it again: always check the version in force.
| Rate | Scope | Where to check |
|---|---|---|
| 19% (standard) | All taxable transactions not covered by the reduced rate | This is the default rate |
| 9% (reduced) | Goods and services listed in article 23 of the CTCA, for example some medical procedures | Article 23 of the CTCA, current version |
| Exemption | Transactions listed in articles 8 to 13 of the CTCA, including exports (article 13) | Articles 8 to 13 of the CTCA |
How the VAT due is calculated
The taxable base is the price excluding VAT, including all costs, duties and taxes other than VAT itself. Each month, the calculation takes three lines:
- Output VAT: your sales for the month excluding tax, multiplied by the applicable rate.
- Input VAT: the VAT shown on your proper purchase invoices linked to your taxable transactions.
- VAT payable: output VAT minus input VAT. If the result is negative, you have a VAT credit, carried forward to the following months.
| Line | Amount |
|---|---|
| Sales for the month, excluding tax | 1,200,000 DA |
| Output VAT at 19% | 228,000 DA |
| Purchases for the month, excluding tax, invoiced with 19% VAT | 500,000 DA |
| Input VAT | 95,000 DA |
| VAT to pay on the G n°50, by 20 October 2026 | 133,000 DA |
Filing and paying VAT, step by step
- 1
Open your tax file
The declaration of existence (G n°8) sets your regime. Under the real regime, VAT applies from your first taxable transaction.
- 2
Invoice with VAT
Each invoice shows the price excluding tax, the rate, the VAT amount and the total including tax, along with the other compulsory details.
- 3
Keep sales and purchase journals
They give you, each month, your output VAT and your input VAT. File purchase invoices by month.
- 4
File the G n°50 by the 20th
A month's VAT is declared and paid by the 20th of the following month, on the same G n°50 as the tax withheld from salaries and, in the months concerned, the corporate income tax (IBS) instalments.
- 5
File even when the figure is zero
In a month with no sales and no purchases, you still file the G n°50, marked nil.
- 6
Use Jibaya'tic
Since 1 January 2026, under the real and simplified regimes, returns are filed online on the DGI portal.
Exports and imports
Exports of goods are exempt from VAT (article 13 of the CTCA), and the DGI allows exporters to buy free of tax under certain conditions. On imports, VAT is collected by customs at clearance. If you are under the real regime, it is then handled like VAT on a purchase, provided you keep the customs documents.
Costly mistakes
- Forgetting the G n°50 in months with no activity: the return is still due, marked nil.
- Calculating VAT on an amount that already includes tax instead of the pre-tax amount.
- Applying the 9% rate without checking the article 23 list.
- Deducting VAT from an improper invoice, or from an expense unrelated to the taxable activity.
- Not tracking your VAT credit from month to month, then losing sight of it.
- Filing without paying, or paying after the 20th: tax law sets penalties calculated on the tax due.
Two ways to get it done
This guide is all you need to do it yourself. Neuron does not do bookkeeping or routine tax and social returns; we can, however, provide your registered address.
1I do it myself
The free guide
Everything you need is on this page: documents, deadlines, a filled-in example.
Free
Follow the guide2An address for your head office
Domiciliation in Dely Brahim
Your registered office in Algiers, with a 1 or 2 year notarised contract and your mail received.
6,000 DA/ month
Register my company