VAT is one of the most confusing topics for freelancers. Do you need to charge it? At what turnover? What changes once you register? This guide breaks down VAT for freelancers — thresholds, invoicing rules, reclaiming input VAT, and cross-border sales — so you know exactly what belongs on your invoices.
VAT basics
VAT (Value Added Tax) is a consumption tax collected by businesses on behalf of the government. As a freelancer, you act as a tax collector: you charge VAT to your clients and pass it on to the tax authority, minus the VAT you paid on your own business purchases. Whether you need to charge VAT depends primarily on your annual turnover relative to your country's registration threshold.
Registration thresholds (2026)
| Country | Standard threshold | | -------------- | -------------------------------------------------------- | | France | €36,800 (services) / €91,900 (goods) | | Germany | €25,000 prior-year turnover / €100,000 current-year cap | | Spain | No threshold — charge VAT from the first euro | | Switzerland | CHF 100,000 | | United Kingdom | £90,000 |
Once you exceed the threshold, you must register and start charging VAT. You can also voluntarily register before reaching the threshold — useful if your clients are VAT-registered businesses that can reclaim it, or if you have significant business expenses.
Invoicing rules when VAT-registered
When you are VAT-registered, every invoice must show:
- Your VAT registration number
- The VAT rate applied to each line item
- The VAT amount per line
- Net total, VAT total, and gross total
Getting these fields right is part of issuing a compliant document — see our guide on how to create a professional invoice.
Invoicing rules when VAT-exempt
If you are below the threshold, include a note on each invoice such as:
"VAT not applicable under Article 293B of the French Tax Code" (France) "Kleinunternehmerregelung gemäß § 19 UStG" (Germany)
An exempt invoice should never display a VAT rate or amount — the price stands alone.
Reclaiming input VAT
Once registered, you can reclaim VAT on business purchases (equipment, software, subcontractors, professional services). This "input VAT" is offset against the "output VAT" you collect from clients. If your input VAT exceeds your output VAT in a period, you can usually claim a refund or carry it forward. For freelancers with high tooling or hardware costs, this is a major argument for voluntary registration.
Selling across borders
- B2B within the EU: the reverse charge usually applies — you invoice without VAT and show both parties' VAT numbers; your client accounts for the tax in their country.
- Clients outside the EU/UK: exports of services are generally outside the scope of domestic VAT, but always confirm the place-of-supply rules for your activity.
See our detailed guide on invoicing international clients.
Filing and deadlines
- Most countries require monthly or quarterly VAT returns
- File even if no VAT was collected in a period (nil return)
- Keep every purchase invoice to support your input-VAT claims
- Late filing penalties can be significant — set calendar reminders
E-invoicing and VAT reporting
VAT reporting is going digital. Through the EU's VAT in the Digital Age (ViDA) reforms and national mandates in France and Germany, structured e-invoicing (Factur-X, XRechnung, UBL) is being tied directly to VAT reporting. Even small freelancers will eventually need to issue machine-readable invoices rather than plain PDFs.
Frequently asked questions
Should I register for VAT voluntarily? It often pays off if your clients are businesses that reclaim VAT, or if you have large deductible expenses. It rarely helps if you sell mainly to consumers.
What happens if I cross the threshold mid-year? You typically must register within a short window and start charging VAT from a set date. Check your national rules — the timing differs by country.
Do I charge VAT to overseas clients? Usually not for B2B EU sales (reverse charge) or non-EU exports, but the place-of-supply rules decide. Confirm before invoicing.
Bottom line
Understanding your VAT status is essential before sending your first invoice. Invoice Creator automatically handles VAT display based on your country profile — ensuring your documents are compliant from day one.