EU Reverse Charge VAT: How to Invoice B2B Clients in the EU

What the reverse charge is

VAT is normally charged by the supplier and paid over by the supplier. The reverse charge turns that around: the customer accounts for the VAT in its own return, at its own country's rate, and the supplier's invoice carries no VAT at all. For cross-border services between businesses in the EU this is not an option but the default, and it rests on two articles of Council Directive 2006/112/EC, the VAT Directive.

Article 44 says that a service supplied to a taxable person, meaning a business acting as such, is supplied where that customer has established its business. Article 196 then says that VAT on such a service is payable by the customer when the supplier is not established in the customer's member state. Put together: a web designer in Germany billing a company in the Netherlands is making a supply that takes place in the Netherlands, and the Dutch company owes the Dutch VAT on it. Your Europe, the EU's own guidance site, summarises it the same way: for B2B services you do not usually need to charge VAT, and the customer pays VAT at the rate applicable in its country under the reverse-charge procedure.

For a business customer that can deduct VAT in full, the reverse charge is tax-neutral: it declares the VAT and deducts it in the same return. What changes is the paperwork, on both sides.

Goods work the same way, under a different article

For goods shipped to another member state the mechanism is an exemption rather than a reverse charge, but the effect on your invoice is the same. Article 138 exempts the supply of goods transported to another member state when the customer is a taxable person identified for VAT in a member state other than the one the goods leave from, and has given you that VAT identification number. The customer then accounts for VAT on the acquisition at home. Article 138(1a) adds a condition the services rule does not have: the exemption falls away if you have not filed the recapitulative statement required by Articles 262 and 263, the periodic list of your intra-EU customers and the amounts supplied to each. Article 262 requires that statement for reverse-charged services under Article 196 as well.

First: check the VAT number

Both rules turn on the customer being a VAT-registered business in another member state, and the proof is its VAT identification number. Article 226(4) requires that number on your invoice whenever the customer is liable for the VAT. The European Commission runs VIES, the VAT Information Exchange System, which asks the customer's national tax office whether a number is valid and usually returns the registered name and address. The VAT number checker tests the format for the country first and then queries VIES; save the result with the invoice, because if the number turns out to be invalid you are the one who did not charge VAT.

What the invoice must contain

Article 226 of the Directive lists the details required on a VAT invoice. For a reverse charge invoice the list reads:

the date of issue;
a sequential number, from one or more series, that uniquely identifies the invoice;
your VAT identification number;
the customer's VAT identification number, because the customer is liable for the VAT (Article 226(4));
the full name and address of both you and the customer;
the quantity and nature of the goods, or the extent and nature of the services;
the date the supply was made or completed, or the date of a payment on account, where it differs from the invoice date;
the taxable amount, the unit price without VAT and any discounts not included in it;
the words "Reverse charge" (Article 226(11a)).

What is missing from that list are the VAT rate and the VAT amount. Article 226a says that a supplier not established in the member state where the tax is due, supplying a customer who is liable for the VAT, may omit the taxable amount per rate, the rate and the VAT amount, and instead state the taxable amount by reference to the quantity or extent and the nature of what was supplied. In practice: one net line, a zero or blank VAT line, and the reverse charge mention. The invoice generator has fields for both VAT numbers and a notes field for the mention; the quote generator lets you show the client the same net figure before the work starts.

Which country's invoicing rules apply? Article 219a says the rules of the member state where the supply is deemed to take place, with a derogation in paragraph 2: when the supplier is not established in that country and the customer is liable for the VAT, the supplier's own country's rules apply instead. So you issue a reverse charge invoice under your own national rules, which may add details to the EU list above. The Commission's invoicing page points to the explanatory notes and to the national provisions each member state has notified.

One fee, three customers

A fee of €2,000 for the same service, billed to three different customers, with an example rate of 19% at home and 21% in the customer's country. The VAT calculator does the gross and net arithmetic for any rate.

Customer	VAT you charge	Invoice total	VAT the customer declares	What the invoice says
Business customer in your own country	€380	€2,380	nothing extra	your 19% VAT on the invoice
Business customer in another EU country (reverse charge)	€0	€2,000	€420	no VAT; the customer declares 21% in its own return
Private customer in another EU country, general rule	€380	€2,380	nothing extra	your 19% VAT, with important exceptions

The middle row is the reverse charge: your invoice total equals the net fee, and the €420 appears only in the customer's VAT return, as output tax and, if deductible, as input tax. The last row is the general rule for private customers in Article 45, which places the service where the supplier is established. Your Europe warns that this rule has several important exceptions; digital services and goods sold at a distance to consumers are taxed where the customer is, under separate rules and the One Stop Shop. This guide covers the B2B case only.

The deadline

Article 222 sets a specific deadline for exactly these two cases: for supplies of goods under Article 138 and for services on which the customer pays the VAT under Article 196, the invoice must be issued no later than the fifteenth day of the month following the month in which the chargeable event occurs. A service completed on 20 March needs an invoice by 15 April. For other supplies the Directive leaves the time limit to the member states.

Checklist

Business customer in another EU member state? If not, the reverse charge does not apply.
VAT number checked in VIES, result saved with the invoice.
Invoice without VAT, with both VAT numbers, the full Article 226 details and the words "Reverse charge".
Issued by the 15th of the month after the supply.
Recapitulative statement filed for the period, listing the customer and the amount.

This guide describes the EU rules in the Directive and the Commission's guidance. Member states add their own requirements, some sectors and transactions have special rules, and the United Kingdom is no longer covered by the Directive. For your own invoices, confirm the details with your tax adviser or tax office.

Frequently asked questions

What does reverse charge mean on an invoice?

That the customer, not the supplier, pays the VAT to the tax authority. Under Article 196 of the VAT Directive, VAT on a business-to-business service covered by the general place-of-supply rule is payable by the customer when the supplier is not established in the customer's country. The supplier issues the invoice without VAT and marks it "Reverse charge"; the customer declares the VAT at its own country's rate and, if it has the right to deduct, deducts it in the same return.

Do I need the customer's VAT number for the reverse charge?

Yes. Article 226(4) of the Directive requires the customer's VAT identification number on the invoice when the customer is liable for the VAT, and for goods Article 138 makes the exemption of an intra-EU supply conditional on the customer being identified for VAT in another member state and having given you that number. Check it in VIES, the European Commission's VAT number validation service, before you invoice, and keep the result.

What has to be on a reverse charge invoice?

Everything a full VAT invoice needs under Article 226: date, a sequential invoice number, your VAT number, the customer's VAT number, both names and addresses, what was supplied and how much, the date of supply if it differs, the taxable amount and the words "Reverse charge". The VAT rate and VAT amount lines are left out; Article 226a allows a supplier not established in the customer's country to omit them and state the taxable amount instead.

When does the invoice have to be issued?

For services on which the customer pays the VAT under Article 196, and for intra-EU supplies of goods, Article 222 of the Directive sets a deadline: no later than the fifteenth day of the month following the month in which the supply took place.

Does the reverse charge apply to private customers?

No. It applies to supplies to taxable persons, meaning businesses, and to non-taxable legal persons identified for VAT. For a private customer in another EU country the general rule in Article 45 places the service where the supplier is established, so you charge your own country's VAT, but Your Europe warns of several important exceptions, such as digital services and distance sales of goods, which are taxed where the customer is.

Sources

Written by Tobias Kurth, designer. Updated October 20, 2026.