Green Circle Talks About Cross-border] The Relationship between German VAT and EORI Numbers

Value Added Tax (VAT) and Economic Operator Recognition Index (EORI) in Germany

Value Added Tax (VAT) Code

conceptual: VAT is a consumption tax that is collected and paid to the tax authorities when companies sell goods or provide services in Germany.

Registration Requirements: When a company's sales in Germany exceed the tax exemption limit, or when a foreign company has stock or provides services in Germany, it may be necessary to register a VAT number, even if the tax exemption limit has not been reached.

Application Process: Details of the business, such as company name, address, scope of business, etc., are required.

Economic Operator Recognition Index (EORI)

conceptual: The EORI number is an identifier used throughout the European Union to identify businesses and individuals in customs declarations and other official documents.

Registration Requirements: Any business or individual carrying out import or export activities within the EU is required to obtain an EORI number.

Application Process: Applications are made via the German Customs Administration website and require information about the company, contact details and nature of the business.

significance: The EORI number is essential for the customs clearance process, without which companies may not be able to complete import and export procedures.

Difference between VAT and EORI

1. Differences in access: VATs are usually registered by a qualified tax agent and EORI numbers are usually applied for by the tax agent at the time of applying for the VAT number.
2. Differences in versatilityOne EORI number can be used for customs clearance in all EU member states, whereas a business may need to register a VAT number in several countries.
3. Differences in useThe EORI number is mostly used for customs declaration and clearance of goods exported, while the VAT number is mainly used for customs duty payment, import VAT and sales VAT declaration.

In conclusion, VAT and EORI numbers are important for cross-border trade and tax reporting, and companies need to understand and use these numbers correctly to ensure smooth business activities.