When you have to register at all.
Ireland
The registration thresholds are €85,000 for the supply of goods and €42,500 for the supply of services, measured over a twelve-month period. Software, SaaS and consulting sit under the services threshold, so it bites earlier than most founders expect.
United Kingdom
You must register once total taxable turnover exceeds £90,000 in any rolling twelve-month period. Note "rolling" — it is not measured against your financial year, so the test can be met mid-year.
Place of supply decides everything.
Software delivered over the internet is an electronically supplied service. Who accounts for the VAT, and at what rate, depends on whether your customer is a business or a consumer, and where they belong.
Selling to businesses (B2B)
Under the general B2B rule the place of supply is where the customer belongs, and the customer accounts for the VAT themselves under the reverse charge. You invoice without VAT — but only if you hold a valid VAT number for them and can evidence that you validated it.
Selling to consumers (B2C)
The place of supply is wherever your consumer lives, so VAT is due at their country's rate — not yours. A German consumer pays German VAT on your product whether or not you have any presence in Germany.
The €10,000 threshold, and the One Stop Shop.
If you're established in one EU member state and your cross-border B2C supplies of telecommunications, broadcasting and electronic services stay below €10,000 in both the current and the preceding calendar year, you can simply charge your own domestic rate on all of them. This is a genuine simplification for small sellers — and a trap, because once you exceed it the general rules apply to all supplies from that point forward, not just the ones above the line.
Above the threshold, you have two options: register for VAT in every member state where you have consumers, or register once for the One Stop Shop (OSS) and file a single return covering all of them. For almost every small business, OSS is the answer.
If you're a UK business, the €10,000 threshold isn't available to you — it applies to businesses established in the EU. Since Brexit, a UK company selling digital services to EU consumers must either register for the non-Union OSS scheme in an EU member state or register for VAT in each member state where it has consumers. There is no de minimis. A company selling into both the UK and the EU is therefore running two regimes at once.
Proving where your customer belongs.
Because the rate follows the consumer, you're expected to hold and retain evidence of where each one is. Acceptable evidence includes:
- ✓The billing address the consumer gave you
- ✓The IP address of the device used to make the purchase
- ✓The consumer's bank details
- ✓The country code of the SIM card, for mobile purchases
- ✓Other commercially relevant information
Where founders get caught.
Charging domestic VAT to everyone
The most common error. A founder registers for VAT at home, adds one rate to every invoice, and discovers eighteen months later that they owed VAT at the customer's rate in nine other countries — payable out of margin already spent.
Treating a VAT number as optional evidence
The B2B reverse charge depends on your customer genuinely being a taxable person. If you can't produce a valid VAT number and evidence you checked it, the supply can be recharacterised as B2C, and the VAT becomes yours to pay.
Missing the €10,000 threshold crossing
Self-serve products cross it quietly. The threshold covers all cross-border B2C supplies of digital services combined, not per country, and once exceeded the general rules apply to everything from that point forward.
Keeping no location evidence
You are expected to hold supporting evidence of where each consumer belongs and to retain it. Reconstructing that after the fact from payment records is painful and sometimes impossible.
VAT questions.
When do I have to register for VAT in Ireland?
The Irish VAT registration thresholds are €85,000 for the supply of goods and €42,500 for the supply of services, measured over a twelve-month period. Most software and consulting businesses fall under the services threshold.
When do I have to register for VAT in the UK?
You must register once your total taxable turnover exceeds £90,000 in any rolling twelve-month period.
Do I charge VAT to business customers in other EU countries?
Generally no. Under the standard B2B place-of-supply rule the customer accounts for the VAT themselves under the reverse charge, provided you hold and can evidence a valid VAT number for them.
What is the €10,000 threshold for digital services?
If you are established in a single EU member state and your cross-border B2C supplies of telecommunications, broadcasting and electronic services stay below €10,000 in both the current and preceding calendar year, you can charge your own domestic VAT rate. Once you exceed it, the general place-of-supply rules apply to all supplies from that point forward.
What is the One Stop Shop?
The One Stop Shop (OSS) lets you account for VAT due on cross-border B2C supplies across the EU through a single registration and a single return in one member state, instead of registering for VAT in every country where you have consumers.
How do UK businesses handle VAT on digital sales to EU consumers?
Since Brexit, a UK business selling digital services to EU consumers must either register for the non-Union OSS scheme in an EU member state or register for VAT in each member state where it has consumers. The €10,000 threshold is not available to businesses established outside the EU.
What evidence do I need for a customer's location?
You need supporting evidence such as the customer's billing address, the IP address of the device used, their bank details, or the country code of their SIM card. Where a payment service provider is involved, two non-contradictory pieces of information — for example a billing address plus the country code from the payment provider — are generally sufficient.
Keep reading.
Get your VAT set up right the first time.
Unwinding a cross-border VAT mess costs considerably more than setting it up correctly.
Thresholds and rules stated on this page were correct as of August 2026 and are drawn from Revenue and HMRC guidance. VAT rules change and depend heavily on your specific facts; this page is general information, not advice.