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International invoicing — VAT, GST, and reverse charge

By Muhammad Saad · 7 min read

Guide

When to charge tax across borders — VAT, GST, reverse charge

Cross-border invoicing has one question that trips up almost every freelancer the first time it comes up: do I charge VAT/GST or not? The short answer is "it depends on three things," and once you know those three things the rest is mechanics.

The three things

1. Where are you registered? If you're not VAT/GST registered, you don't charge VAT/GST. Skip the rest of this article. (But check whether you're required to register based on revenue — see thresholds below.)

2. Where is your customer? Same country as you, different country in the same union (EU), or completely outside.

3. Is your customer a business or a consumer? B2B and B2C have totally different rules in most jurisdictions.

VAT in the EU (the rules most freelancers care about)

EU VAT works on the "place of supply" principle for services. Whose VAT rules apply depends on where the customer is.

B2B service, customer in another EU country: You don't charge VAT. Instead, you note "Reverse charge — VAT to be accounted for by the recipient" on the invoice. The customer self-assesses VAT in their country. You also need both your VAT number and their VAT number on the invoice, and you must report the sale on your EC Sales List.

B2C service, customer in another EU country: Depends on the service. Digital services (downloads, SaaS, ebooks) are taxed at the customer's VAT rate, which means registering for the OSS scheme to file one return for all EU. Most other services are taxed at your home rate.

Customer outside the EU: Generally outside the scope of EU VAT. Show 0% or mark "Outside the scope of EU VAT." You still report the sale on your VAT return as a zero-rated supply.

UK VAT after Brexit

UK has its own VAT system (still 20% standard rate). EU customers are now treated as outside-UK like the US would be. B2B services to overseas customers are typically outside the scope of UK VAT.

For UK B2B clients of EU freelancers: the reverse charge mechanism still works, and most VAT-registered EU freelancers invoice UK businesses without VAT, with "Reverse charge applies" on the invoice. The UK client self-assesses.

GST in Canada, Australia, and Singapore

Canada (GST 5% / HST 13–15% / PST): Place of supply rules similar to VAT. B2B to a Canadian-registered business: the business handles GST/HST under reverse charge. Cross-border outbound: typically zero-rated.

Australia (GST 10%): Don't charge GST on supplies to non-residents. Inbound digital services to Australian consumers from foreign suppliers may trigger GST registration if you're selling more than AUD 75,000/year.

Singapore (GST 9%): Pretty much the same approach. Threshold SGD 1M for mandatory registration.

Registration thresholds (2026)

You can register voluntarily below the threshold. Some freelancers do this to reclaim input VAT on business purchases.

The reverse charge phrase to memorize

For B2B cross-border in the EU, your invoice needs the magic words. Pick one of these on the invoice notes:

You also need both VAT numbers on the invoice (yours and your client's). Check the client's VAT number is valid via VIES — if it's invalid, you're back to charging VAT.

Common mistakes

If this gets complicated, get help

International tax for freelancers reaches a complexity ceiling around the 200k/year revenue mark or when you have customers in 5+ jurisdictions. At that point, the cost of a tax advisor is much less than the cost of getting it wrong. Until then, this article covers most cases.

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International invoicing — VAT, GST, and reverse charge explained | InvoiceWithMe