Tax Number vs. VAT ID: The Big Difference

Every entrepreneur writing an invoice for the first time faces the question: Should I include the tax number or the VAT ID on the invoice? After all, both numbers can be listed on an invoice. You’ll learn which number is required when here.

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Distinguishing Tax Identification Numbers in Europe

In Europe, there are three types of tax identification numbers:

• Tax Number
• Tax Identification Number (Tax ID)
• VAT Identification Number (VAT ID)

Tax Number vs. VAT ID: What’s What?

There isn’t just one tax number for businesses—no: as an entrepreneur, you can have both a tax number and a VAT number (VAT ID). Both numbers are used equally for tax identification. Your tax office issues the tax number. In addition, every individual has had an 11-digit personal tax identification number (Tax ID) from the Federal Central Tax Office since 2008. Since November 2024, the Federal Central Tax Office has been issuing the business identification number (Wirtschafts-Identifikationsnummer, W-IdNr.) to businesses in stages. For now, it does not replace the tax number or VAT ID on invoices.

Tax Number: Using the Tax Number on German Invoices

When you issue invoices to individuals or businesses that, like you, are based in Germany, you put your tax number on the invoice. Your personal Tax ID is not enough: § 14(4) UStG requires the tax number or the VAT ID.

If your customer is resident in Germany, you can alternatively provide your VAT identification number (VAT ID) instead of the tax number under § 14 UStG.

Many entrepreneurs actually prefer the voluntary disclosure of their VAT ID. It’s more secure from a data protection perspective and offers fewer opportunities for misuse than the tax number. The tax number is often abbreviated as St.-Nr. Don’t confuse it with your personal Tax ID.

VAT ID: Using the Tax Number on Invoices to Other EU Countries

For invoices you issue to customers in other EU countries, you sometimes need the VAT identification number.

VAT ID for B2B Transactions

The VAT identification number is mandatory when you, as an entrepreneur registered for VAT purposes, issue an invoice to another entrepreneur in another EU country (B2B transactions) or as a seller outside the EU.

A VAT identification number can only be assigned to businesses, and in some cases it’s your tax identification number for other EU countries. It can therefore be required when you issue an invoice to a business partner in another EU country. The German VAT ID consists of the country code DE and nine digits, for example “DE123456789”.

Micro-businesses that only operate in Germany don’t need a VAT identification number. According to the Federal Central Tax Office, anyone who supplies goods or services to, or receives them from, businesses in other EU countries needs one, micro-businesses included. Many micro-businesses apply for one anyway and use it on invoices or in their imprint. This is completely legitimate. The reason is often that they don’t want to disclose their tax number and prefer to use the VAT ID instead.

The VAT ID can also be referred to as:

• VAT ID
• VAT Identification Number
• VAT Identification Number
• VAT ID No.

You can recognize the VAT ID by the country code prefix. As an entrepreneur in Germany, your VAT ID consists of DE and nine digits.

How to Obtain a VAT Identification Number

When you register your business with the tax office and apply for a tax number, you can apply for the VAT ID directly. Alternatively, you can submit the application online with the Federal Central Tax Office.

What Must Be Included on a German Invoice?

In addition to your tax number or VAT identification number, you must include your full name and business address on your invoice. The same applies to your customer’s name and address. For services to businesses in other EU countries where your customer owes the tax, and for intra-community supplies, both your VAT ID and your customer’s VAT ID must be on the invoice (§ 14a UStG).

Furthermore, your invoice must contain the following information:

• the invoice date
• a unique invoice number (e.g., based on the initials of your customer’s name - the invoice number - invoice month: JI-001-0919)
• quantity and item description or service
• date of service/delivery
• net amount
• tax rate (not required for micro-businesses)

If you’re a micro-business, you must state the reason for your VAT exemption on the invoice: “No VAT charged as micro-business under § 19 UStG”.

Don’t forget to include your bank details so your customer can pay the invoice. We also recommend giving your customers a payment deadline of 7 to 21 days. If the customer hasn’t paid by then, you can simply follow up.

Tax Number for Invoices Under 250 Euros?

No! Invoices under 250 euros in Germany don’t require a tax number at all. Such so-called small-amount invoices are, for example, train tickets, fuel receipts, or cash register receipts.

Support and Assistance

You now know all the basics about the German tax number and VAT identification number. However, the application process can still take a lot of time. If you’d like support with it, we’re happy to help.

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