VAT ID Check: Why Reverse Charge Without Validation Is Risky

A business customer in France orders goods and sends you their VAT identification number. Whether you may invoice the supply without German VAT depends on more than the format of that number. For goods moving between EU countries, the question is whether the supply qualifies as an exempt intra-Community supply. Reverse charge, by contrast, applies to certain other supplies, mainly services. The two are often mixed up in practice.

This article explains what you can check for a VAT ID, how to document the check and what to do when the result is negative.

Distinguish intra-Community supplies from reverse charge

For an exempt intra-Community supply, the cross-border movement of the goods, the customer's status and the valid VAT ID the customer uses must meet the applicable conditions. Evidence and reporting requirements also apply, such as the EC Sales List. Since the EU "Quick Fixes" took effect on 1 January 2020, a valid customer VAT ID is a substantive condition of the exemption (section 4 no. 1(b) and section 6a UStG).

For services, first establish the type and place of supply (section 3a UStG). Only then can you assess whether the customer owes the VAT and you invoice net with the note "reverse charge" (section 13b UStG). A VAT ID alone does not settle those questions. What counts is its validity at the time of the transaction, not at some later point.

Format, existence, attribution: three levels of checking

Format. Every country has its own pattern: DE plus nine digits, FR plus eleven characters, NL with a "B" in position ten. Typos and transposed digits show up here.

Existence. Whether a formally correct number has actually been issued and is valid is answered by the European Commission's VIES service. German businesses can also obtain confirmation from the Federal Central Tax Office (BZSt) (section 18e UStG).

Attribution. Does the number really belong to this company at this address? The BZSt's qualified confirmation, which also checks name and address, documents exactly that.

Our free EU VAT Number Validator covers the first two levels. It checks the format directly in your browser. At the click of a button, it then queries VIES and shows whether the number is valid, invalid or whether the member state is currently not responding; for this query, the number is sent to VIES via our server. It does not replace a qualified confirmation from the BZSt.

Check and document

A check you cannot prove later is of little help in a tax audit. Archive the date and result of every query, for example as a printout or with the confirmation number. Check new business customers before the first invoice. If a customer's name or address changes, a fresh qualified confirmation makes sense.

The following table is an organisational recommendation. There is no fixed statutory checking interval such as "quarterly".

Trigger	Recommended depth
New customer, first B2B invoice	Format and qualified confirmation
Existing customer, recurring supplies	Format on every invoice, existence at fixed intervals
Unusually large single order	Fresh qualified confirmation
Change of name or address	Fresh qualified confirmation

What to do when the result is negative

A negative validation result needs clarification. Check the supplied details and record the result and time of the query. Then establish with the customer and your tax adviser which conditions apply to the transaction and how the invoice should be issued or corrected. An invalid number does not universally mean that 19% German VAT must be charged.

How to separate gross and net amounts cleanly is covered in our guide to calculating VAT. The bigger picture with OSS and stock held abroad is covered in our article on VAT in e-commerce.

Conclusion: the format check is the first filter

A format check is a useful first filter, and the VIES query is the second. Neither confirms that the number belongs to your business partner, and neither replaces the VAT assessment of the transaction. Keep the documented check traceable alongside the invoice and delivery evidence.

KudTax pulls your order, payment and invoice data from shops and marketplaces, reconciles it with AI assistance and creates journal entries that you hand to your accountant, for example as a DATEV export. KudTax is free for up to 25 orders a month, and larger plans can be tried free for one month: create an account. If you would rather discuss your data sources first, book a demo.