If your business sells physical goods as a Non-EU member, you should be aware of the following VAT rules.


The import VAT is calculated as a percentage (VAT rate) of the taxable amount.

  • The VAT rate is the one applicable in the country where the goods are being delivered.

  • You can also check the VAT rates applied in each country. 

  • The taxable amount is made up of the customs value plus the duty paid and the transportation and insurance costs up to the first place of destination within the EU.


The VAT is not due when the total value of all goods in a consignment(value not inclusive of customs duties or transport costs) is less than a threshold. The threshold may vary from 10 euros to 22 euros, depending on the EU country


Certain countries (like Sweden and Poland) however, exclude mail orders from the exemption.  This exception does not apply to tobacco or tobacco products and alcoholic products.

 

The import VAT may either be included in the overall delivery price or not.

  • If the import VAT is not included in the price paid to you(which is the common situation), your client would have to pay it to the postal company or express courier, or directly to the customs if they clear the goods at customs themselves. In the latter case, the procedure differs according to the country.

  • If your clients pay all-inclusive, they would be paying import VAT to you when paying the total price. But if the import VAT is not properly estimated by you, or if you fail to ensure the transfer of this VAT amount to the customs, your clients must be aware that national legislation can hold them jointly liable.


If your business is in the digital goods and services space, you should collect VAT as per EU VAT 2015. You can read more about VAT rules for B2C and B2B sales in here.