Scope of this guide. This article focuses on shipments between EU member states from the perspective of EU-based businesses. It covers B2C (business-to-consumer) sales primarily, with relevant B2B (business-to-business) information where applicable.
Benefits of the EU single market
The EU single market provides unique advantages for cross-border e-commerce:No customs duties
Goods move freely between EU member states without:- Customs declarations
- Import duties
- Export documentation
- Border inspections
Harmonized regulations
The EU provides consistent rules across member states:- Product safety standards: CE marking applies throughout the EU
- Consumer protection: Uniform consumer rights and return policies
- Data protection: GDPR applies to all EU countries
- Payment services: PSD2 enables secure payments across borders
Faster delivery
Without customs clearance delays:- Predictable delivery times
- Lower risk of shipment delays
- Simpler tracking and logistics
- Better customer experience
VAT in intra-EU trade
While customs duties don’t apply, VAT regulations are critical for intra-EU shipments. The rules differ significantly between B2C and B2B sales.B2C sales (Business to Consumer)
When selling to consumers in other EU countries, you must charge VAT according to specific rules:Distance selling thresholds
The EU’s One Stop Shop (OSS) scheme simplified VAT for cross-border B2C sales: €10,000 annual threshold:- If your annual intra-EU sales are below €10,000, charge your home country’s VAT rate
- If your annual intra-EU sales exceed €10,000, you must either:
- Register for VAT in each destination country, or
- Use the OSS scheme (recommended)
- A Danish webshop sells €8,000 to German customers and €5,000 to French customers annually
- Total intra-EU sales: €13,000 (exceeds threshold)
- Must charge German VAT on German sales and French VAT on French sales
- Should register for OSS to simplify compliance
OSS (One Stop Shop) scheme
The OSS scheme allows you to declare and pay VAT for all EU member states through a single quarterly VAT return in your home country: Benefits:- Single registration in your home country
- One quarterly VAT return covering all EU sales
- No need to register for VAT in each destination country
- Simplified compliance and administration
- Register for OSS in your home country
- Charge the destination country’s VAT rate at checkout
- Submit a quarterly OSS return in your home country
- Pay collected VAT to your tax authority
- Your tax authority distributes VAT to destination countries
Required information for B2C
To properly charge VAT on B2C sales:- Customer’s delivery address (determines VAT jurisdiction)
- Accurate product classification (some products have reduced VAT rates)
- Order value in euros
- Shipping costs (included in VAT calculation base)
B2B sales (Business to Business)
Selling to businesses in other EU countries follows different VAT rules:Reverse charge mechanism
For intra-EU B2B sales:- You charge 0% VAT (VAT exempt) on the invoice
- The buyer is responsible for declaring and paying VAT in their country
- This is called the “reverse charge mechanism”
- Customer must provide a valid VAT identification number
- Customer’s VAT number must be verified through VIES
- You must issue a proper intra-community supply invoice
- You must report the transaction in your VAT return and INTRASTAT (if applicable)
VIES verification
The VAT Information Exchange System (VIES) allows you to verify EU VAT numbers:- Customer provides their VAT number (e.g., DE123456789)
- Verify the number through the VIES online system
- Keep proof of verification for your records
- Issue invoice with 0% VAT if valid
Keep verification records. Always save proof that you verified the customer’s VAT number and that it was valid at the time of the transaction. This protects you in case of tax audits.
Recapitulative statement (EC Sales List)
When making intra-EU B2B sales, you must submit a recapitulative statement:- Lists all intra-community supplies during the period
- Shows customer VAT numbers and transaction values
- Submitted monthly or quarterly (depends on volume)
- Filed with your regular VAT return
Shipping and logistics
Carrier selection
Major carriers serve intra-EU routes well:- DHL, UPS, FedEx: Premium service with good tracking
- PostNord, Bring, GLS: Cost-effective for Nordic and Northern Europe
- DPD, Hermes: Popular for Central and Western Europe
- National postal services: Often the most economical option
Carrier connections
Set up carrier connections for EU shipping
Documentation requirements
Intra-EU shipments require minimal documentation: Required:- Shipping label with full delivery address
- Commercial invoice (for value declaration)
- Proof of delivery (retained by carrier)
- Customs declarations
- Export licenses
- Certificates of origin (for intra-EU trade)
Practical implementation
E-commerce platform setup
The required steps for setting up your ecommerce store for intra-EU sales depends on your e-commerce platform:Shopify integration
Learn how to configure Shopify for EU shipping
WooCommerce integration
Set up WooCommerce for intra-EU sales
Product data requirements
Prepare your product data for EU sales: Essential fields:- Product name and description
- Price in euros (or configured to convert)
- Weight and dimensions
- VAT category (standard, reduced, zero-rated)
- Country of origin (optional for intra-EU, but good practice)
- HS codes (only needed for non-EU shipments)
- Customs value
- Export licenses
Pricing strategy
Consider these factors when pricing for EU markets: Shipping costs:- Weight-based pricing for heavier items
- Flat-rate pricing for predictable margins
- Free shipping thresholds to increase average order value
- Display prices including VAT (required in B2C)
- Show VAT amount separately on invoice
- Be transparent about total cost at checkout
- Price in euros for broadest appeal
- Consider local currency display for major markets
- Use real-time conversion rates if offering multiple currencies
Common compliance mistakes
Avoid these frequent errors: Applying wrong VAT rate:- Using your home country rate instead of destination country rate
- Not recognizing reduced-rate products
- Applying B2B rules to B2C transactions
- Not verifying VAT numbers through VIES
- Failing to keep verification records
- Missing reverse charge references on invoices
- Not registering when threshold is exceeded
- Incorrect country allocation of sales
- Missing quarterly filing deadlines
Special considerations
Northern Ireland
Northern Ireland has special status post-Brexit where goods shipments between EU and Northern Ireland follow EU rules.EU overseas territories
Some territories are outside EU VAT territory and must be treated differently from EU countries:- Canary Islands (Spain)
- Ceuta and Melilla (Spain)
- Åland Islands (Finland)
- Mount Athos (Greece)
Resources and tools
EU official resources:- OSS information and registration
- EU - VIES VAT number validation
- EU - Taxes in Europe Database (TEDB)
