P&C Help Centre
Taxes applicable to my invoice
Learn about VAT that we sometimes have to add to our invoices.
In this article:
Price&Cost is VAT (Value Added Tax) registered in Estonia, a European Union country. Therefore, we are obliged to apply VAT to some of our invoices.
EU Tax rules explained
The way and circumstances when VAT is applied for an EU business in quite convoluted. The below image explains it quite well:
What this means:
Your business/you is registered/reside in EU
- If you are a business registered in the EU and have a valid VAT registration number:
- If you are registered in Estonia – an Estonia VAT tax rate will be applied to the invoice (currently 20%)
- If you are registered in any other EU country (other than Estonia) – a 0% VAT rate will be applied (also called Reverse Charge)
- If you are a business registered in the EU but don’t have a valid VAT registration number (i.e not VAT registered and therefore fall under B2C definition) – your local VAT tax rate will be applied (see the latest rates here)
- If you are a person (not a business) with a billing address in EU – your local VAT tax rate will be applied (see the latest rates here)
Your business/you is registered/reside outside of EU
- No VAT will be added to your invoice.
How do we determine your registration/residence
We take 2 pieces of information into account – your Billing address Country and your IP address (this is a legal requirement). Based on this – we determine your location and therefore tax rates applicable.
How do we determine you are a business
For the EU VAT tax calculation purposes – we look at the VAT number you’ve provided in the Billing details. Learn more on how to update your VAT number.