EU introduces e-service VAT simplifications

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From 1 January 2019, EU member states introduced simplified VAT rules for businesses selling electronic services to consumers online in other EU Member States.

These new simplifications consist of:

  • Small EU businesses selling less than €10,000 worth of electronic services to consumers in other EU member states per year will issue their invoices and charge VAT under their home countries VAT regime. Only when they exceed this threshold will they have to switch to charging VAT locally in the consumer customers country.
  • EU businesses selling less than €100,000 worth of electronic services to consumers in other EU member states per year will only need to obtain one piece of evidence proving the country of residence of their customers. Current rules require that these types of businesses must obtain two pieces of evidence.