VAT number 2024: Format, Registration, Threshold & more

E-commerce trade is becoming increasingly popular compared to traditional trade and brings one or two advantages with it. One would be, for example, the possibility of being able to trade across national borders. The prerequisite for intra-European trade is a VAT number, which identifies companies in the European Union. We tell you everything you need to know about it.

VAT registration number: Definition

The VAT ID enables unique identification of all companies in the European Union. Anyone who wants to trade within Europe must register accordingly for this VAT ID. With the help of this number, your sales and expenses are recorded and thus serve as the basis for corresponding tax payments. Therefore, you should include your VAT number on your invoices, VAT returns and any communication with the tax office.

Example for EU VAT number

In principle, the VAT number consists of a prefix (country code at the beginning) and a suffix (digits for identification). In the following, we will show you an example based on the German VAT identification number:

Country Code	DE
Characters	9
Format	DE123456789

DE corresponds to the prefix, i.e. the country-specific code, which in the case of Germany is “DE”. This is followed by the nine-digit numeric code. However, the length and requirements for this digit code differ from country to country.

VAT Number in Europe

The VAT registration number differs depending on the country and is structured differently in each case. It consists of four to 15 characters, of which the two at the beginning represent the country code (e.g. DE for Germany). Below we have compiled a list of all country codes, as well as the respective structure of the VAT IDs in each country.

VAT ID depending on the country:

Country	Format
VAT Number Belgium	BE + 10 digits
VAT Number Bulgaria	BG + 9 digits BG + 10 digits
VAT Number Denmark	DK + 8 digits
VAT Number Germany	DE + 9 digits
VAT Number Estonia	EE + 9 digits
VAT Number Finland	FI + 8 digits
VAT Number France	FR + 11 digits (first and second position can be letters)
VAT Number Greece	GR + 9 digits
VAT Number Italy	IT + 11 digits
VAT Number Ireland	IE + 8 characters (second position can, last must be letter) IE + 9 characters (last two positions must be letters)
VAT Number Croatia	HR + 11 digits
VAT Number Latvia	LV + 11 digits
VAT Number Lithuania	LT + 9 digits LT + 12 digits
VAT Number Luxembourg	LU + 8 digits
VAT Number Malta	MT + 8 digits
VAT Number Netherlands	NL + 12 characters (third last position must be the letter B)
VAT Number Austria	AT + U + 8 digits
VAT Number Poland	PL + 10 digits
VAT Number Portugal	PT + 9 digits
VAT Number Romania	RO + max. 10 digits
VAT Number Sweden	SE + 12 digits
VAT Number Slovenia	SI + 8 digits
VAT Number Slovakia	SK + 10 digits
VAT Number Spain	ES + 9 characters (first and/or last position can be a letter)
VAT Number Czech Republic	CZ + 8 digits CZ + 9 digits CZ + 10 digits
VAT Number Hungary	HU + 8 digits
VAT Number Cyprus	CY + 9 characters (last position must be a letter)
VAT Number United Kingdom	GB + 9 digits GB + 12 digits

Example for EU VAT number

In principle, the VAT number consists of a prefix (country code at the beginning) and a suffix (digits for identification). In the following, we will show you an example based on the German VAT identification number:

Country Code	DE
Characters	9
Format	DE123456789

DE corresponds to the prefix, i.e. the country-specific code, which in the case of Germany is “DE”. This is followed by the nine-digit numeric code. However, the length and requirements for this digit code differ from country to country.

When do I need a VAT registration number?

If you are a trader just starting out, you generally do not yet need a VAT ID. This is because those who only trade within their own national borders only need a simple tax number, but not a VAT ID. Since most e-commerce merchants initially start out in their own country, the VAT ID is usually more of a future issue in the beginning.

Delivery threshold is exceeded

The VAT ID becomes relevant when you start to conduct intra-Community trade with other European countries. There are so-called delivery thresholds that you must observe. VAT Registration thresholds are country-specific turnover limits that oblige you to register for VAT in the respective country if you exceed them. This means that if your net turnover from sales to the respective country exceeds the delivery threshold there, you must register for a VAT ID there. This rule is expected to remain in effect until July 1, 2021.

New regulation from July 2021: On July 1st, the country-specific delivery thresholds were replaced by a uniform Europe-wide delivery threshold of EUR 10,000. This does not mean that every country now has a delivery threshold of EUR 10,000.00 – instead, the delivery threshold applies to the whole of Europe. As soon as you earn more than 10.000,- EUR net per year with sales to other European countries, you have to register for VAT in all EU countries you sell to. hellotax can take care of these VAT registrations for you. Contact us today to find out more and simplify your VAT duties.

Since this would of course involve an enormous amount of work, new regulations that make this process much easier for you were also implemented. The so-called Mini-One-Stop-Shop procedure (MOSS) provided a remedy. With this procedure, you as a retailer no longer had to register for VAT in all the member states to which you want to sell. Instead, you can handle the VAT incurred centrally via a single point of contact. In Germany, for example, this would be the German Federal Central Tax Office. 

The use of this procedure is voluntary, but generally recommended. Otherwise, you would have to register for VAT in every country to which you want to sell products, as soon as you generate a total of 10,000 EUR net per year with sales abroad. And with the registration, of course, all other VAT tasks and obligations would go hand in hand. 

On the one hand, the new delivery threshold regulation is intended to make it easier for traders to keep track of their taxes and obligations. On the other hand, it is intended to reduce the likelihood that states will miss out on tax revenues. 

New regulation from July 2021: When the new threshold regulation came into effect, the Mini One-Stop-Shop was replaced by the On-Stop-Shop. While the functionality remains, the processes have been standardized across the European Union. You can now replace necessary foreign VAT registrations due to cross-border transactions within the EU with an OSS registration and VAT returns with OSS reports. However the compilation of OSS reports is a new hurdle in itslef. But not to worry! hellotax can also take care of OSS registration and the submission of OSS reports.

Storage of your goods in other European countries

Besides the delivery threshold, another common reason for the obligation to register for VAT is the storage of goods in other European countries. If you store your goods in a European country other than your own and ship them from there to your customers, this also leads to the obligation to register for VAT in the respective country of storage. 

Merchants who use Amazon FBA are particularly often affected by this, as in this case your products are usually temporarily stored in Amazon warehouses in different EU countries. 

New regulation from July 2021: Planning on using the One-Stop-Shop? The new scheme might not be as useful as you think as it comes with some exceptions. An OSS registration only replaces VAT registrations necessary because of corss-border transactions, but not those necessary because of storage. In case you are storing products in foreign EU countries, you still have to register for VAT but might still want to take advantage of the OSS scheme. This is not a problem with hellotax. Our team of accountants can take care of OSS and VTA registrations simultanously and our software can handle both the compilation of VAT returns and OSS reports. Contact us today to find out more and simplify your VAT duties.

Purchase of goods in other European countries

The third common cause of VAT registration in other European countries is the purchase of goods there. If a foreign company wants to purchase goods, the seller there expects to be provided with a corresponding local VAT ID. If this is not available, the trade cannot take place, as the seller is obliged to submit the buyer’s ID to the tax office as well.

The requirements apply not only to companies in the EU, but to all – that is, equally to companies from third countries, but who wish to trade with EU companies. 

Where can I apply for a VAT ID? 

How you can register for the VAT ID number differs from state to state – usually this is possible online at the respective tax office or by mail. Since it often takes a few weeks from application to assignment of the number, it is advisable to apply for the ID early so that it is available as soon as, for example, the delivery threshold has been exceeded and not just a few weeks later.

Although the required documents may differ depending on the country, the following documents are usually always expected:

• Proof of VAT or tax registration in the country of origin.
• The company’s certificate of incorporation (copy)
• The company’s articles of association (copy)
• An extract from the national company register as proof of existence,
• Proof of the intended business (e.g. contracts or invoices)

With the successfully completed VAT registration in the respective country, your taxes, which you generate with sales in this country, are to be paid there in the future. Depending on the country, it may make sense to work with a local tax advisor. Please also note that most VAT registrations can also be completed in the national language and might require you to have documents translated.

You can apply for a VAT number online or via mail to the respective tax office. However, VAT registration is made easier by hellotax. Why you ask? Your registration assistant will guide you through the registration process step by step directly in the hellotax tax software. You will only need to submit your documents once. We translate them and reuse them for any registration necessary – now and in the future. Based on your transaction data we let you know when you need a new VAT registration, apply for it, and let you know once we have received a new VAT number. You’ll never miss a deadline. Furthermore our team of local tax accountants can take care of VAT duties in foreign EU countries and can replace local tax advisors. Book a call with our VAT experts to find out more.

VAT number lookup: Use VIES tool for VAT number validation

The correct use of a VAT number is important in many ways. The first and most obvious is your own accounting: if you submit an incorrect VAT number on your tax returns, your tax return will be rejected. Not only will you incur costs, but also a lot of paperwork and justifications as to how this came about. You can even be accused of intent.

Checking not only your own VAT number is important: if you do business with other companies, you should also make sure that they provide a correct VAT number. Otherwise, the transactions between your company and theirs can lead to problems with your tax office, which can mean more costs and paperwork for you. Therefore, it is important to check your own VAT number as well as the VAT number of your business partners in advance.

How to check a VAT number

The European Commission has developed a tool with which you can determine the correctness of VAT numbers. To do this, enter the country of origin of the company in question and its VAT number in the so-called VIES tool. If the VAT number is found to be correct and belongs to the company, you can proceed with your business relations accordingly.

If the number is indicated as invalid, this can have various causes, which you should clarify. There may simply have been a typo, which can be easily corrected. Or it may be fraud and a company is trying to do business with you that is not legal. A third possibility is that the VAT number has simply not yet been entered or released in the appropriate registry. In this case you should contact the responsible tax office.

Summary

The VAT number is the key identifier for companies trading within Europe. It is not only relevant for the tax authorities to contact you, but also for you personally when you enter into business relations with other companies to check their legality. The VAT number differs depending on the country, but follows the same basic structure of a two-digit country code and a sequence of digits of varying length.