What is a VAT Number?

A VAT number (Value Added Tax number) is a unique identifier assigned to businesses and legal entities that are registered for value-added tax. It is used primarily in invoicing, cross-border transactions, and tax reporting. In the European Union and many other countries, VAT numbers allow tax authorities to track the payment and collection of VAT across companies and industries.

Format and Examples

Each country has its own VAT number structure, usually starting with the country code followed by digits and sometimes letters. For example:

Germany: DE123456789
France: FRXX999999999
United Kingdom (pre-Brexit): GB999 9999 73

Businesses must include their VAT number on invoices, receipts, and tax-related documents when they are VAT registered.

VAT Numbers in the USA

The United States does not use a VAT system. Instead, it applies sales tax at state and local levels. Therefore, there is no U.S. VAT number. Businesses in the U.S. use identifiers like an EIN (Employer Identification Number) issued by the IRS for tax purposes. However, U.S. companies trading with VAT-based jurisdictions may be asked for a “VAT number,” in which case they should clarify that they operate under the U.S. tax system:contentReference[oaicite:0]{index=0}.

Why VAT Numbers Matter

VAT numbers are essential for:

Cross-border trade: They ensure compliance with EU tax laws.
Invoice validation: Buyers can verify whether a supplier is VAT-registered.
Tax deductions: Businesses may reclaim VAT on eligible purchases if they provide a valid VAT number.
Fraud prevention: VAT numbers help authorities track transactions and reduce tax evasion:contentReference[oaicite:1]{index=1}.

How to Find or Validate a VAT Number

You can usually find your VAT number on:

Your VAT registration certificate issued by the tax authority.
Invoices or official billing documents from your business.
EU’s official VIES VAT validation system.

Key Takeaway

A VAT number is a critical tax identifier for businesses in VAT jurisdictions, but it does not exist in the U.S. system. If your company operates internationally, always include the correct VAT number on invoices to avoid compliance issues and delays in cross-border payments.

VAT Number vs EIN vs SSN (Quick Comparison)

These identifiers serve different purposes. Use this guide to choose the right one for invoicing and tax compliance.

VAT Number

What it identifies: A business registered for Value Added Tax (VAT).
Where it’s used: Countries with VAT systems (e.g., EU, UK, many others). Not used in the U.S.
Format: Country code + alphanumerics (e.g., DE123456789, FRXX999999999).
Issued by: National tax authority of the VAT country.
Invoice use: Must appear on invoices from VAT-registered sellers.

EIN (Employer Identification Number)

What it identifies: A U.S. business entity for federal tax purposes.
Where it’s used: United States (IRS).
Format: XX-XXXXXXX (9 digits, e.g., 12-3456789).
Issued by: IRS (Internal Revenue Service).
Invoice use: Appears on W-9, vendor onboarding, and can be cited on invoices when requested—not a VAT number.

SSN (Social Security Number)

What it identifies: U.S. individuals for Social Security and tax reporting.
Where it’s used: United States (SSA/IRS).
Format: XXX-XX-XXXX (e.g., 123-45-6789).
Issued by: Social Security Administration (SSA).
Invoice use: Generally not printed on invoices for security; sole proprietors can provide SSN (or better, an EIN) on W-9.

Which should I use on an invoice?

EU/UK or other VAT countries: Use your VAT Number (and the customer’s, if required).
U.S. domestic: No VAT number. Use EIN when requested (e.g., vendor setup), not on every invoice by default.
U.S. business invoicing the EU: Clarify you are not VAT-registered in the EU; include EIN and any local tax notes per the customer’s rules.

U.S. Examples

Example 1 — U.S. LLC invoicing a U.S. client

Tax system: U.S. sales tax (state/local), no VAT.
What to show: Business name, address, invoice number, line items, any applicable sales tax, payment terms. EIN only if the client requests it for records.
Do not show: A “VAT number” (the U.S. does not issue VAT numbers).

Example 2 — U.S. freelancer invoicing an EU company

Tax system: No U.S. VAT. EU client may have reverse-charge rules.
What to show: A note like “Supplier is a U.S. business, not VAT-registered. Reverse charge may apply per customer’s local rules.” Include your EIN if requested for vendor onboarding.
Customer data: EU client’s VAT number may be required on their side for reverse charge.

Example 3 — U.S. sole proprietor (no EIN yet)

Best practice: Apply for an EIN and use it instead of SSN when clients request tax IDs (privacy/security).
Invoices: Do not print your SSN. Provide SSN only on secure tax forms if absolutely necessary.

Copy-paste invoice block (U.S. sender, international client)

Use this block on international invoices to avoid VAT confusion:

Seller: [Your Company Name]
Address: [Street, City, State, ZIP, USA]
Tax ID (U.S.): EIN [12-3456789]
VAT Status: Not VAT-registered (U.S. business, no VAT number)
Customer VAT (if applicable): [Customer VAT ID]
Payment: Bank Transfer (International)
  • Bank Name: [Bank]
  • SWIFT/BIC: [e.g., CHASUS33]
  • IBAN/Acct: [If applicable / local acct + routing]
Reference: Invoice #[xxxx] — Please include this reference in payment