In one line
The registration number of a business registered for value added tax, shown on tax invoices.
Also called a VAT registration number or a VAT ID.
What it means in practice
VAT applies outside the US, so it matters when you invoice clients abroad. A registered client will need your number and theirs on the document before they can reclaim the tax.
Rules on which country's VAT applies to cross-border services are their own subject. Check the position for the country you are billing into before you add or omit the tax.
Example. A UK client asks for your VAT number and theirs to appear on the invoice.
Where it shows up on the paperwork
In your business block on the invoice, alongside your address, and on the client's side too when they are registered and the tax is being reclaimed.
What goes wrong
- Charging VAT before the registration is confirmed.
- Assuming US sales tax rules apply to a client abroad.
- Leaving the client's VAT number off a cross-border invoice that needs it.
The tools for this
Related terms
- Tax invoiceAn invoice that shows tax charged on the sale, with the rate and your tax registration number.
- EIN (Employer Identification Number)The federal tax number that identifies a US business, used the way a Social Security number identifies a person.
- InvoiceA document that asks a client for payment for work already delivered.
Common questions
Do I need a VAT number to invoice a client abroad?
Only if you are VAT registered where you trade. Which country's VAT applies to cross-border services is its own subject and worth checking before you add or omit the tax.
Where does the VAT number go on an invoice?
In your business details near your name and address. Where the client is registered and reclaiming, theirs goes with their details too.