Germany VAT Compliance for Non EU Ecommerce Businesses

Romain Chiaramonte
Oct 1
7 min read

Germany stands at the heart of the European Union, both geographically and economically. With over 80 million consumers and a high average purchase value per order, Germany is an essential market for any non EU ecommerce business looking to grow in Europe. The country hosts major Amazon and Zalando fulfillment hubs making it a logistics powerhouse for pan European sellers.

If you're shipping goods to customers in Germany from outside the EU (whether from the UK, the US, China, or Asia), you must comply with German VAT (Value Added Tax) regulations. VAT is a consumption tax applied to goods and services sold within the EU. For ecommerce businesses, it’s not just a tax obligation. It directly affects customer trust, delivery speed, and platform compliance.

Failing to register, charge, and remit VAT correctly can lead to:

Blocked shipments or customs seizures.
Marketplace suspensions (e.g. Amazon requires valid VAT numbers).
Backdated tax assessments and penalties.
Reputational damage and customer loss.

VAT rules for non EU sellers are stricter than those for EU based businesses. You may need to appoint a fiscal representative, comply with local invoicing laws, and navigate whether OSS (One Stop Shop), IOSS (Import One Stop Shop), or direct registration applies to your business model.

This guide helps you understand what Germany VAT compliance entails and how Global Trade Business can support you with registration, filing, and long term success in the German market.

Understanding Germany’s VAT System

Before getting into the nitty gritty of registration and compliance, it’s important to understand how VAT works in Germany. This is especially for businesses outside the EU. Germany follows the destination principle. What this means is that VAT is due where the goods are consumed. If your customers are in Germany, German VAT applies even if your business is based elsewhere.

VAT Rates in Germany

Germany has two main VAT rates:

Standard VAT rate (19%): Applied to most goods and services, including electronics, fashion, homeware, and general ecommerce items.
Reduced VAT rate (7%): Applied to a limited range of goods such as books, newspapers, and some food products.

When you sell directly to German consumers, you're generally expected to charge the 19% standard rate, unless your product falls under a specific exemption.

VAT Registration Thresholds: EU vs. Non EU Businesses

In Germany, VAT registration rules differ depending on where your business is established.

EU based businesses can delay VAT registration until they exceed the EU wide €10,000 threshold for distance sales. When they meet the threshold, they can use the OSS (One Stop Shop) system to simplify reporting across the European Union.

Non EU businesses, on the other hand, face stricter rules:

There is no VAT registration threshold.
If you sell any amount of goods to German consumers or store goods within Germany, you must register for German VAT from your first sale.
You will also need to appoint a fiscal representative, who is jointly liable for your VAT compliance in Germany.

What Counts as “Distance Selling” in Germany?

Distance selling refers to selling goods directly to consumers (B2C) in another EU country without a fixed establishment there. For example:

A US based seller ships products from a UK warehouse to individual buyers in Germany.
A Chinese seller sends products directly to German customers from a Hong Kong fulfillment center.

In both cases, the seller is distance selling into Germany. Depending on whether goods are shipped from within or outside the EU, different rules apply:

If shipped from within the EU, you can use OSS if you qualify.
If shipped from outside the EU, IOSS may apply (for low value goods).
If goods are stored in Germany, local VAT registration is mandatory, regardless of order volume.

What About “Imported Goods”?

Imported goods are physical products shipped into Germany from outside the EU. This includes direct to consumer orders sent from your non EU warehouse or supplier.

Germany treats these imports as taxable events. Here are the key points you need to be aware of:

Import VAT is due at the border unless you use IOSS.
For goods valued over €150, IOSS cannot be used, and import VAT is paid by the importer (you or your customer).
If you're the importer of record, you’ll need a German VAT number and EORI number to clear goods through customs.

Important note: Importing goods without proper VAT setup can lead to customs delays, unexpected duties, or unhappy customers.

Who Needs to Register for VAT in Germany?

As a non EU seller, you need to register for VAT in Germany if:

You store inventory in Germany even if it’s temporarily.
You ship goods from outside the EU without using IOSS.
You use a fulfillment center or third party logistics provider in Germany.
You exceed the OSS threshold and Germany becomes a major market.
You sell goods greater than €150 in value to German customers.

Unlike EU based sellers, non EU companies are required to appoint a fiscal representative to register and file VAT returns in Germany. This representative is jointly liable for your VAT obligations.

VAT Registration Process for Non EU Businesses

If you're a non EU business planning to sell to customers in Germany (or store goods in German warehouses like Amazon FBA) you’re legally required to register for Germany VAT. Unlike EU based companies, non EU sellers must meet additional requirements including appointing a local fiscal representative.

Here’s a step by step overview of what is involved.

What Documents Do You Need to Register for VAT in Germany?

German tax authorities require a detailed application supported by official documents. These typically include:

Certificate of Incorporation: To verify your legal business identity in your home country.
Power of Attorney (PoA): This authorizes your appointed fiscal representative to act on your behalf with the German tax office.
Company Extract or Business Registration Certificate: To show your business is active and legally recognized in your jurisdiction.
Valid Identification: For the company director or authorized signatory (usually a passport copy).
Description of Your Business Activity: This includes the nature of goods sold, expected transaction volume, and sales channels (e.g. Shopify, Amazon).
German VAT Registration Application Form (USt 1 TJ): The official form required to request a VAT number in Germany.

Global Trade Business helps compile and translate these documents so that your application meets all local tax office expectations.

How Long Does VAT Registration Take?

The typical processing time is 4 to 6 weeks. This depends on:

The completeness and accuracy of your documents.
The workload of the German tax office (Finanzamt).
Whether a fiscal representative is properly appointed.

If additional documentation or clarification is needed, registration may be delayed. That’s why working with a provider like Global Trade Business can speed things up and reduce back and forth with authorities.

Cost of VAT Registration in Germany

Costs vary based on whether you're doing it yourself or working with a compliance provider. As a non EU seller, you will need:

Fiscal Representative Fee: Since German law mandates fiscal representation for non EU entities, this is typically a recurring annual fee.
One Time Setup or Registration Fee: It covers the review, preparation, and submission of your VAT registration.
Ongoing Compliance Fees: Including VAT return filing, correspondence with the tax office, and recordkeeping.

At Global Trade Business, we offer fixed fee VAT registration packages that include fiscal representation, helping you budget with confidence.

Why Fiscal Representation Is Mandatory

As a non EU seller, you cannot register directly with German tax authorities on your own. You must appoint a fiscal representative based in Germany.

This representative is legally responsible for:

Communicating with German tax authorities.
Submitting your VAT returns.
Ensuring compliance with German VAT law.
Covering any unpaid VAT liabilities on your behalf.

This legal liability makes fiscal representation a serious undertaking. As such, it’s essential to choose an experienced provider with a proven track record.

At Global Trade Business, we act as your fiscal rep and compliance partner hence giving you peace of mind and full legal coverage.

How Do You Get a Germany VAT Number?

Once your application is submitted and approved, you’ll receive a German VAT identification number. This is required to:

Charge VAT on invoices to German customers.
Clear goods through German customs.
Comply with Amazon or marketplace VAT requirements.
Submit monthly or quarterly VAT returns.

The format of a German VAT number is DE + 9 digits (example DE123456789).

You must include this number on all relevant invoices and official documents, and keep it updated in marketplace platforms like Amazon, eBay, or Etsy.

Ongoing Compliance Requirements

VAT Returns

Returns are typically filed monthly or quarterly, depending on your turnover. You need to declare:

Total VAT collected on sales.
Input VAT on business expenses.
Net VAT payable or reclaimable.

Filing is done through Germany’s ELSTER system, which requires German language proficiency and technical setup.

Invoicing Requirements

German invoices must include:

Seller and buyer details.
Your German VAT number.
Invoice date and number.
Taxable amount and VAT applied.
A clear breakdown of VAT rates.

Record Keeping

Germany requires 10 years of digital and physical record retention. This includes invoices, customs documentation, and filing records.

Intrastat and EC Sales Lists

If you move goods between Germany and other EU countries, you may also need to file Intrastat declarations and EC Sales Lists, especially if you hold stock in multiple locations.

OSS & IOSS: When Are They Enough?

Many sellers ask: “Can I just use OSS or IOSS instead of registering in Germany?”

Well, the answer depends on your business model.

OSS (One Stop Shop)
Lets you report all intra EU B2C sales via one return.
Only applies if you're shipping from one EU country to others.
Does not cover goods stored in Germany or imports from outside the EU.
IOSS (Import One Stop Shop)
Covers goods shipped from outside the EU valued at €150 or less.
Lets you collect VAT at checkout and declare it in a monthly return.
Simplifies customs clearance.
Non EU sellers must use an IOSS intermediary.

Please note that IOSS cannot be used for goods over €150 or goods stored in the EU.

If you store stock in Germany, ship goods over €150, or sell on Amazon, you must register directly in Germany.

Ready to Simplify VAT Compliance? You don’t have to manage this alone. With Global Trade Business, you get a single partner for Germany VAT, OSS, IOSS, and VAT recovery, backed by local expertise.

Book a free call today. We’ll assess your situation and recommend the simplest solution!