The European Member states have agreed for member states to extend the same VAT registration thresholds enjoyed by domestic businesses to EU taxpayers from other member states (non-resident). The aim is to encourage EU businesses to trade within the Single Market by cutting the costs and paperwork of VAT until their trade takes off.
EU companies must VAT register immediately in other EU states
Currently, non-residents must immediately VAT register if supplying eligible goods or services in another EU state. The EU distance selling thresholds were withdrawn on 1 July 2021 as part of the EU VAT e-commerce package reforms.
2025 – new €85,000 EU VAT registration threshold
From 2025, member states will be able to set a VAT registration threshold of €85,000 for domestic and non-residents. However, non-residents would be limit to a total income in other member states totalling €100,000 combined. This would prevent traders deliberately selling limited amounts in each state and thus evading VAT.