Why and for which companies do you need to get VAT and EORI numbers?

When operating within the European Union (EU), businesses often face regulatory requirements, particularly in the areas of taxation and international trade. Two essential identifiers that businesses must frequently obtain are the Value Added Tax (VAT) number and the Economic Operators Registration and Identification (EORI) number. These identifiers are critical for ensuring compliance with EU legislation and for facilitating seamless business operations across borders.  

A VAT number is a unique identifier assigned to businesses registered for Value Added Tax purposes in the EU. VAT, a consumption tax applied to goods and services, is governed by the EU VAT Directive (Council Directive 2006/112/EC), which establishes uniform rules for VAT compliance across Member States. Obtaining a VAT number is a legal obligation for businesses engaged in taxable activities, including the supply of goods or services subject to VAT, both domestically and across borders. Businesses involved in intra-EU trade are required to register for VAT to benefit from zero-rated VAT on supplies, provided they meet reporting requirements. Additionally, companies exceeding the distance selling thresholds or operating under the One-Stop Shop (OSS) or Import One-Stop Shop (IOSS) schemes, which simplify VAT reporting for cross-border e-commerce, must also register for VAT. Failure to comply can result in penalties, shipment delays, and legal complications, making timely VAT registration crucial for businesses.  

An EORI number, on the other hand, is a unique identifier required for customs purposes in the EU. It is mandatory for businesses and individuals engaged in the import, export, or transit of goods to or from the EU. The requirement for an EORI number is established under Regulation (EU) No 952/2013, also known as the Union Customs Code (UCC), which governs customs procedures within the EU. An EORI number must be included in customs declarations to ensure smooth customs processing and facilitate the identification of businesses in EU systems. Non-EU businesses trading with the EU must apply for an EORI number in the first Member State where they interact with customs. Without it, customs clearance cannot proceed, potentially leading to costly delays or confiscation of goods.  

Businesses often require both VAT and EORI numbers when their activities involve cross-border trade within or outside the EU. Manufacturers, wholesalers, and e-commerce sellers are common examples of companies that need both identifiers. These businesses must comply with VAT obligations for goods sold across borders while also using an EORI number for customs declarations when goods are imported or exported. Logistics companies and service providers may also require both identifiers if their operations include the supply of taxable services and the movement of goods across EU borders.  

To register for a VAT number, businesses must apply through the tax authority in the Member State where their economic activities occur, providing evidence of business operations and meeting local requirements. For an EORI number, businesses established in the EU apply through the customs authority in their Member State, while non-EU businesses apply in the first country where they trade.