Umsatzsteuerkennzeichen

Umsatzsteuerkennzeichen, often abbreviated as USt-IdNr. or UID number, is a unique identification number used in the European Union for Value Added Tax (VAT) purposes. It is assigned to businesses that conduct intra-Community trade, meaning they buy or sell goods or services to businesses in other EU member states. The primary purpose of the Umsatzsteuerkennzeichen is to facilitate the correct application of VAT rules for cross-border transactions within the EU.

When a business invoices another business in a different EU country for goods or services, it must include its Umsatzsteuerkennzeichen and the customer's Umsatzsteuerkennzeichen on the invoice. This allows tax authorities to track these transactions and ensure that VAT is accounted for correctly. In most cases, intra-Community supplies of goods and services are zero-rated for VAT in the country of the supplier, with the VAT liability shifting to the recipient business through the reverse-charge mechanism. The Umsatzsteuerkennzeichen is crucial for verifying the legitimacy of these zero-rated transactions and preventing VAT fraud.

Businesses can apply for a Umsatzsteuerkennzeichen from their national tax authority. The format of the number typically includes a country code followed by a series of digits or letters. It is essential for businesses to ensure they use the correct Umsatzsteuerkennzeichen when issuing or receiving invoices for intra-Community transactions to avoid penalties and ensure compliance with EU VAT regulations.