Law and billing
Reverse charge VAT
Why an EU business with a VAT number is invoiced without VAT by a provider in another member state, and what it has to do instead.
When a business in one EU country buys a service from a business in another, the supplier does not charge its own VAT. The invoice is issued without VAT, marked "reverse charge", and the customer accounts for the VAT in its own country at its own rate, deducting it in the same return where it is entitled to. The net effect for a normal business is zero cash movement.
The condition is a valid EU VAT number on the customer's side, which the supplier checks in VIES. Without it, the customer is treated as a consumer and pays the supplier's VAT: 17 % in Luxembourg, which is why prices here are shown both ways.
Consumers anywhere in the EU pay the Luxembourg rate on NovaNode's services. Businesses inside Luxembourg pay 17 % and reclaim it as usual. The price switch on this site only changes the display; what the invoice says follows the VAT status of your account.