EU Reverse Charge Invoice Template
Compliant reverse charge invoice template for cross-border B2B services within the EU, with required legal references.
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When to Use This Template
Use this template whenever you supply services to a business customer located in a different EU member state and the reverse charge mechanism applies. This is one of the most common cross-border invoicing scenarios in the EU, and getting it right is essential for VAT compliance on both sides of the transaction.
The reverse charge applies under Article 196 of the EU VAT Directive (Council Directive 2006/112/EC). When you provide B2B services where the place of supply is the customer’s country under the general rule, you do not charge VAT. Instead, the customer accounts for the VAT in their own VAT return. This simplifies cross-border trade because you do not need to register for VAT in every EU country where you have clients.
However, the invoice must contain specific elements to be compliant. You must include both your VAT identification number and the customer’s VAT number, and you must add a clear reference to the reverse charge. The exact wording varies by country, but a reference to Article 196 of the VAT Directive is universally understood. Without this reference, your client may face problems deducting the input VAT, and you may be held liable for the VAT in your own country.
Key Fields to Include
- Supplier’s full name, address, and VAT identification number
- Customer’s full name, address, and VAT identification number
- Invoice number (sequential, per your national rules)
- Invoice date and date of supply or service period
- Clear description of the services supplied
- Net amount (no VAT charged)
- The statement: “VAT reverse charge - Article 196 Council Directive 2006/112/EC”
- Currency and total amount due
- Payment details (IBAN/BIC for SEPA)
Tips
- Always verify the customer’s VAT number on the VIES database before issuing the invoice. If the number is invalid or the customer is not VAT-registered, you cannot apply the reverse charge.
- Include this transaction in your EC Sales List (ESL), which most EU countries require on a monthly or quarterly basis.
- The reverse charge does not apply to B2C transactions. If your customer is a private individual, you must charge VAT, potentially under the OSS scheme.
- Keep proof that your customer is a taxable person (their VAT number confirmation from VIES) in your records.
- Some countries require the reverse charge note in the local language. When in doubt, include it in both English and the client’s language.
Frequently Asked Questions
What is the reverse charge mechanism?
The reverse charge shifts the obligation to account for VAT from the supplier to the customer. Instead of the supplier charging VAT, the customer self-assesses and reports the VAT in their own country. This avoids the supplier needing to register for VAT in the customer's country.
Which services does the reverse charge apply to?
It applies to most B2B services where the place of supply is where the customer is established, under the general rule of Article 44 of the VAT Directive. This covers consulting, IT services, legal services, marketing, and many others. Exceptions include services related to immovable property, passenger transport, and certain cultural events.
What happens if I forget to include the reverse charge notice on my invoice?
An invoice missing the required reverse charge reference may not be accepted by the client's tax authority, potentially preventing them from recovering input VAT. You should issue a corrected invoice as soon as possible. Some countries impose penalties for non-compliant invoices.