Within the principal EU VAT directive, articles exist which dictate that EU member states must apply a standard rate of VAT within a particular range, and may also choose to apply a reduced VAT rate no lower than 5% (although certain EU member states may have derogations from this which allows a lower percentage).
The directive also specifies the nature of the goods and services to which the reduced rate may be applied, and as a result of this many EU member states apply the reduced rate to the same types of products (i.e. foodstuffs, books).
European member states may on occasion reclassify goods to be reduced or standard rated, and it is important to be aware of any changes that occur.
Every European member state has a slightly different format for their VAT number system, featuring a variation of numbers and letters. It is important that companies take close care in using the correct format as the numbers are frequently checked against the VIES system, and errors may create delays or even fines. You can also make use of our VAT Number Checker tool.
Below is a summary of the EU VAT Rates, VAT Number Formats and Thresholds.
*Thresholds apply for sales up to 1st July 2021 only, after which the EU rules were updated: For non-EU sellers, there is no revenue threshold and registration will be required in all member states where sales are made. For EU-based sellers, a threshold of €10,000 per annum applies – but this threshold refers to all EU sales, so if your sales revenue across the whole EU is greater than €10,000 – you will need to register in every EU state where you deliver goods. Read more about registrations options and the OSS here.