Reverse charge on e-invoices (XRechnung, ZUGFeRD)
Updated 2026-10-05
When you sell services to a business in another EU country, the VAT is often not charged by you but paid by your client in their country. This is called reverse charge. E-invoices express it with a specific VAT category, and the validator checks that the required details are present.
This guide explains the e-invoice format, not your tax position. Whether reverse charge applies depends on your situation; check with a tax advisor.
What a reverse charge e-invoice must contain
- VAT category code AE ("VAT reverse charge") on the lines and in the VAT breakdown
- VAT rate 0% and VAT amount 0.00
- An exemption reason text such as "Reverse charge" (often with the code
VATEX-EU-AE) - Your VAT ID or tax number, and your client's VAT ID
If one of these is missing, the invoice fails rules such as BR-AE-02 or BR-AE-10, and German receivers may reject it.
Freelancers outside the EU
If you are based outside the EU (for example in the US, UK or India) and bill an EU business for services, the place of supply is often the client's country and the client accounts for the VAT. On the e-invoice you can then use reverse charge with your local tax number (for example a US EIN) as the seller tax identifier, plus your client's VAT ID.
Other zero-VAT cases
- Exempt (E): for example the small-business scheme in Germany or Austria. Add the legal basis in the invoice note.
- Not subject to VAT (O): the supply is outside the scope of VAT. Such invoices must not contain VAT IDs at all.
- Zero rated (Z): a taxable supply with a 0% rate.
Create one
In the einvoicegen form, choose "Reverse charge" as VAT treatment. The form asks for the right IDs and the generated XRechnung and ZUGFeRD files include category AE, the exemption text and code automatically.
Need to send an e-invoice?
Create a valid XRechnung and ZUGFeRD invoice in 2 minutes, in English. Free preview, validated with the official KoSIT validator.