Rules for VAT on sales to private consumers in the EU

From 1 July 2021, the VAT rules on sales to private consumers in the EU changed. This means, among other things, that a new common EU limit of EUR 10,000 per year was introduced. The limit covers the total sale of a business to other EU countries beside the sales in country where the business is domiciled - Denmark, for example. The new limit for all of the EU is much lower that former limits that only applied to a single country.

The limit means that businesses in the EU have to pay VAT in the country of consumption when the business total distance selling of goods and electronically provided services, including telecommunications services and radio and tv broadcasting services, to other EU countries in total exceeds EUR 10,000 per year. This may have a great impact on your business when it charges, declares and pays VAT. Using VAT One Stop Shop you may register your business for sale to private consumers in the EU in one EU country and declare and pay VAT in that particular country.

Please make sure that your business is ready to mange the new set of rules which you find more about below.

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The purpose of the new EU rules are to improve the terms of competition of EU businesses and to enable increased VAT settlement in the country of consumption according to this particular country's VAT rates and rules. The rules aim to remove VAT as a competitive element and to ensure that in the long term Danish online businesses, among others, may compete at more equal terms in the EU.

Once the new rules take effect, you should:

be able to charge different VAT rates (standard rates or reduced rates) and VAT amounts on sales to various EU countries when you provide a private consumer with goods or services (this could be via a web shop).
be able to determine the individual goods or services as several EU countries differentiate their VAT. For example: A country's standard VAT rate may be 22%, but it has reduced the VAT rate on books to 20% and on medicine the VAT rate is 10%. See the current VAT rates in the EU.
have specific accounts in your business accounts for this kind of sales. Read more in Danish about accounts in our legal guide section D.A. 16.3.8 Accounts.
specifically check in which country the consumer want to use the goods or services.
keep your accounts for 10 years.
declare and pay VAT in each individual EU country. VAT One Stop Shop offers you a very simple way to do this which you can read more about on this page.

Additionally, it may mean that you have to adjust your business IT systems to handle the new rules and that you consider and meet other declaration deadlines than those related to ordinary VAT payments.

VAT One Stop Shop is a new optional scheme enabling you to observe the new rules more easily as you can declare and pay VAT in one EU country on all your sales to the entire EU. The VAT One Stop Shop scheme replaces the VAT Mini One Stop Shop scheme when the new rules take effect on 1 July 2021. Read more about the new VAT rules on sales to private consumers in the EU.

You can manage your VAT via one or more of the three special schemes under VAT One Stop Shop: the Union scheme, the non-Union scheme and the import scheme. If you have a Danish business, you can use the union scheme and the import scheme. Read more about the three schemes here on this page.

If you want to know more about how you register your business, you can read more about registering for the VAT One Stop Shop scheme.

Log on VAT One Stop Shop using MitID

You have to use MitID or MitID for businesses (MitID Erhverv) to log on to VAT One Stop Shop in future if you do want to register your business or have to declare or pay VAT under the VAT One Stop Shop scheme.

You can no longer access VAT One Stop Shop if you have used an E-tax password to log on.

Log on using two-factor authentication if you do not have MitID

If your business cannot get MitID, you have to log on to VAT One Stop Shop using a two-factor authentication.

You are the only one who can register your business

Please note that you cannot transfer your rights to somebody else (such as an accountant or an advisor) for them register your business for the VAT One Stop Shop scheme on your behalf. You can only register your own business, which is why you should be logged on as your business. If your business is registered as an intermediary of the import scheme, you may register other businesses for the import scheme.

The Union scheme (VAT One Stop Shop)

You may use the Union scheme if your business is Danish and you provide distance selling of goods or sell certain services to private consumers in other EU countries. If you sell goods, these goods have to physically be within the EU borders.

The non-EU scheme (VAT One Stop Shop)

You can use the non-Union scheme if your business is established outside the EU and you sell services to private consumers in the EU. However, your business may not be established (with a fixed place of business) in the EU.

The import scheme (VAT One Stop Shop)

You can use the import scheme if you provide goods at distance selling to private consumers in the EU and they are sent directly to the consumer from non-EU countries. However, the value of the goods may not exceed EUR 150.

What is the effect of the new VAT rules on your business?

What is VAT One Stop Shop?

Register for VAT One Stop Shop

Deregister for VAT One Stop Shop

The Union scheme (VAT One Stop Shop)

The non-EU scheme (VAT One Stop Shop)

The import scheme (VAT One Stop Shop)