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Charging VAT in the EU: What You Need to Know

If your business sells goods or services within the European Union, VAT (Value Added Tax) is a critical part of your pricing, invoicing, and compliance strategy. Whether you're a SaaS provider, eCommerce platform, or service business, understanding when and how to charge VAT is essential.

Who Has to Charge VAT?

You may be required to charge VAT depending on:

Your location (EU or non-EU)
Your customer’s VAT status (business or consumer)
Where the customer is located
The type of goods or services you provide

Business-to-Business (B2B)

If you’re selling to a business in another EU country and they provide a valid VAT number, you typically do not charge VAT. Instead, the transaction may be subject to the reverse charge mechanism.

This is where VAT validation becomes crucial. If the VAT number is invalid or missing, you may be required to charge local VAT.

Business-to-Consumer (B2C)

When selling to individual consumers in the EU, you generally must charge VAT based on the customer’s location. This applies to:

Digital services (e.g. SaaS, downloads, subscriptions)
Physical goods delivered across EU borders

If your B2C sales exceed country-specific thresholds, you may need to register and file VAT in multiple EU states or use the One Stop Shop (OSS) scheme.

Why Real-Time Validation Matters

Incorrect VAT handling can result in penalties or denied deductions. That’s why real-time validation using our API ensures that you:

Only apply reverse charge when it’s legally allowed
Have proof of validation during invoicing
Keep your accounting and tax reporting accurate

Get Started Today

Use VatValidate to check your EU customers’ VAT numbers in real time. Our API makes it easy to integrate validation into your checkout, signup, or invoicing process.

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