skills-ws/skills/eu-tax-accounting/references/2-vat-regimes-by-country.md

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## Contents

- 2. VAT Regimes by Country
- Standard and Reduced Rates
- Cross-border SME VAT exemption (since 1 Jan 2025)
- OSS — One-Stop Shop (since July 2021)
- IOSS — Import One-Stop Shop
- Reverse Charge Mechanism (B2B)
- Digital Services VAT (destination-based since 2015, via OSS since July 2021)

## 2. VAT Regimes by Country

### Standard and Reduced Rates

*Last verified: Jun 2026. Source of truth: [EU VAT rates database (TEDB)](https://ec.europa.eu/taxation_customs/tedb/) and each national tax authority. Reduced/super-reduced rates apply only to listed categories (food, books, medicine, passenger transport, etc.) — never assume a reduced rate without checking the national annex. Domestic registration thresholds are revised frequently; treat the figures below as orientation and confirm before relying on a small-business exemption.*

| Country | Standard | Reduced Rates | Super-Reduced | Registration Threshold (domestic) |
|---------|----------|---------------|---------------|----------------------------------|
| Austria | 20% | 13%, 10% | — | €35,000 |
| Belgium | 21% | 12%, 6% | — | €25,000 |
| Bulgaria | 20% | 9% | — | BGN 100,000 (~€51,000) |
| Croatia | 25% | 13%, 5% | — | €40,000 |
| Cyprus | 19% | 9%, 5% | 3% | €15,600 |
| Czech Republic | 21% | 12% | — | CZK 2M (~€80,000) |
| Denmark | 25% | — (no reduced rates) | — | DKK 50,000 (~€6,700) |
| Estonia | 22% | 9% | — | €40,000 |
| Finland | 25.5% | 14%, 10% | — | €20,000 |
| France | 20% | 10%, 5.5% | 2.1% | €85,800 (goods) / €34,400 (services) |
| Germany | 19% | 7% | — | €22,000 |
| Greece | 24% | 13%, 6% | — | €10,000 |
| Hungary | 27% | 18%, 5% | — | HUF 12M (~€31,000) |
| Ireland | 23% | 13.5%, 9% | 4.8% | €80,000 (goods) / €40,000 (services) |
| Italy | 22% | 10%, 5% | 4% | €65,000 (forfettario) |
| Latvia | 21% | 12%, 5% | — | €40,000 |
| Lithuania | 21% | 9%, 5% | — | €45,000 |
| Luxembourg | 17% | 14%, 8% | 3% | €35,000 |
| Malta | 18% | 7%, 5% | — | €35,000 (activity-dependent) |
| Netherlands | 21% | 9% | — | €20,000 (KOR scheme) |
| Poland | 23% | 8%, 5% | — | PLN 200,000 (~€46,000) |
| Portugal | 23% | 13%, 6% | — | €13,500 |
| Romania | 19% | 9%, 5% | — | RON 300,000 (~€60,000) |
| Slovakia | 23% | 19%, 5% | — | €50,000 |
| Slovenia | 22% | 9.5%, 5% | — | €50,000 |
| Spain | 21% | 10% | 4% | — (no threshold; registration mandatory from first supply) |
| Sweden | 25% | 12%, 6% | — | SEK 80,000 (~€7,000) |

**Highest VAT**: Hungary (27%), Denmark/Sweden/Croatia (25%)
**Lowest VAT**: Luxembourg (17%), Malta (18%), Germany (19%), Cyprus/Romania (19%)

### Cross-border SME VAT exemption (since 1 Jan 2025)

The EU "SME scheme" (Directive 2020/285) lets a small business established in one member state apply the **domestic small-business VAT exemption in other member states** without registering there, if EU-wide turnover stays **≤ €100,000** and the host country's national threshold is respected. Opt in via your home tax authority (you receive an "EX" VAT number). This is separate from OSS and changes the "do I need to register abroad?" calculus for very small sellers — see the VAT registration decision tree in §11. Verify eligibility at your national tax authority.

### OSS — One-Stop Shop (since July 2021)

The OSS simplifies VAT compliance for **cross-border B2C sales** within the EU:

- **Who**: Any business selling goods/digital services to consumers in other EU countries
- **Threshold**: €10,000 combined cross-border B2C sales to all EU countries. Below this, charge your home country VAT rate. Above, charge destination country rate.
- **How**: Register for OSS in ONE EU country (your establishment). File a single quarterly return covering all EU B2C sales. Pay all VAT through one portal.
- **Union OSS**: For EU-established businesses selling B2C goods/services cross-border
- **Non-Union OSS**: For non-EU businesses supplying digital services to EU consumers
- **Filing**: Quarterly — by end of month following quarter (e.g., Q1 due April 30)

### IOSS — Import One-Stop Shop

For goods imported into the EU with value ≤ €150 sold B2C:
- Collect VAT at point of sale (destination country rate)
- Report via single monthly IOSS return
- Goods clear customs VAT-free (expedited)
- Non-EU sellers must appoint an EU intermediary

### Reverse Charge Mechanism (B2B)

Cross-border B2B services within the EU:
- Supplier issues invoice **without VAT** (0%)
- Invoice must state: "Reverse charge — Art. 196 Council Directive 2006/112/EC"
- Buyer self-assesses VAT on purchase (input and output = net zero if fully deductible)
- Both parties must have valid EU VAT numbers — verify via VIES (https://ec.europa.eu/taxation_customs/vies/)

### Digital Services VAT (destination-based since 2015, via OSS since July 2021)

All B2C digital services (SaaS, streaming, e-books, online courses, cloud services) are taxed at the **customer's country** rate:
- Determine customer location via 2 non-contradictory pieces of evidence: IP address, billing address, bank country, SIM card country
- Use OSS to report and pay
- No de minimis for digital services supplied by non-EU businesses

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