VAT Information Notice
VAT rates and thresholds shown are based on EU regulations and may change. Rates are subject to change by member states. This is general information only - consult a VAT specialist or your accountant for compliance advice. Information current as of January 2025.
Key Thresholds at a Glance
OSS registration required above this (2025)
Estonian VAT registration required (2025)
Per-package limit for IOSS scheme (2025)
Thresholds shown are current as of 2025 and may be adjusted by EU or national legislation.
Detailed Threshold Breakdown
€10,000 — EU-Wide B2C Threshold
This threshold applies to cross-border B2C sales of digital services and distance sales of goods within the EU.
What counts:
- Digital products sold to EU consumers
- Physical goods shipped to consumers in other EU countries
- Combined total across ALL EU countries (not per-country)
What doesn't count:
- B2B sales (reverse charge)
- Sales to non-EU customers
- Domestic Estonian sales
Above threshold: Register for OSS and charge VAT at customer's country rate.
€40,000 — Estonian Domestic Threshold
This threshold applies to taxable supplies within Estonia specifically.
What counts:
- Sales to Estonian customers (B2B and B2C)
- Some intra-EU supplies depending on structure
What doesn't count:
- Exports to non-EU countries
- Most B2B intra-EU services (reverse charge)
Note: Most e-resident businesses primarily serve non-Estonian customers, staying below this threshold.
€150 — IOSS Package Limit
The Import One-Stop-Shop (IOSS) scheme applies to consignments valued at €150 or less.
How it works:
- Goods imported from outside EU to EU consumers
- Each package must be €150 intrinsic value or less
- Charge VAT at checkout → goods clear customs without customer paying import VAT
Above €150 per package:
- IOSS doesn't apply
- Customer pays import VAT + duties at delivery
- Consider EU fulfillment for higher-value goods
Below Threshold: What Happens?
You Can Operate Without VAT Registration If:
B2B Services Only
If you only sell services to businesses (with VAT numbers), reverse charge applies. No VAT registration needed regardless of revenue.
Non-EU Sales Only
Selling exclusively to US, UK, or other non-EU customers? No EU VAT applies. No registration needed.
Below All Thresholds
Under €10k cross-border B2C AND under €40k Estonian domestic? VAT registration optional (but may still be beneficial for input VAT recovery).
Country-Specific Domestic Thresholds
If you establish presence in other EU countries, their domestic thresholds apply there:
* France has different thresholds for goods vs services. ** Spain has no threshold for standard rate supplies. These are domestic thresholds — the €10k OSS threshold is separate.
Values shown are approximate and current as of 2025. Verify with official sources before relying on these figures.
Should You Register Voluntarily?
Benefits of Early Registration
- ✓ Reclaim VAT on business expenses
- ✓ Appear more professional to B2B clients
- ✓ Simpler intra-EU B2B transactions
- ✓ No surprise registration later
Reasons to Wait
- • Administrative overhead of VAT returns
- • Monthly filing requirements
- • Cost if you have few reclaimable expenses
- • Complexity if you're just testing
Related VAT Topics
OSS & IOSS VAT Compliance Guide
Everything about One-Stop-Shop and Import One-Stop-Shop for EU VAT compliance.
Amazon FBA Europe VAT Requirements
VAT requirements for Amazon FBA sellers. Pan-European FBA, inventory storage, marketplace rules.
Etsy EU VAT for Sellers
VAT compliance for Etsy sellers. Marketplace collection and handmade/vintage sales.
Dropshipping to Europe VAT Guide
IOSS registration, customs duties, and VAT collection for dropshippers.
Frequently Asked Questions
Everything you need to know before getting started
All information verified as of December 2025. Prices and features subject to change. Always verify current pricing with providers.
