Invoicing EU Clients From India: VAT, Reverse Charge and the Euro Invoice

Your first client in Berlin or Amsterdam asks for an invoice. Then their finance team writes back: "Please add our VAT number and the reverse charge note." You have never registered for VAT anywhere. Do you owe it?

Usually, no. When you are invoicing EU clients from India, the VAT question has a short answer for business clients and a narrower one for consumers. The rest of the invoice is the same export invoice you send a US client, just in euros. This post covers both sides: what the EU expects, and what Indian GST and FEMA still expect from you.

Not legal or tax advice. A plain explainer for Indian freelancers billing EU clients. EU VAT is applied by 27 member states, each with its own rules on top of the shared Directive. Check anything unusual with a CA, and with a VAT adviser in the client's country.

This post is about the 27 EU member states only. The UK, Switzerland and Norway are outside the EU and have their own VAT systems.

The short version

• EU business client: you don't charge EU VAT. The client accounts for it themselves under the reverse charge.
• EU consumer (an individual, not a business): most services you perform yourself (design, development, consulting, writing) are taxed where you are, so no EU VAT either. The exception is automated digital services, such as a SaaS subscription sold to consumers.
• On the Indian side: it's an export of services. With an LUT, no IGST, and the export endorsement goes on the invoice.
• Bill in EUR. Record the INR value for your books and GST return.
• FEMA clocks start on the invoice date: 9 months to realise the money, and a monthly EDF.

Why you don't charge VAT to an EU business

The EU VAT Directive (2006/112/EC) decides where a service is taxed. The European Commission's own summary of the general rules:

• For business-to-business services (Article 44): "the place of taxation is the place where the customer is established".
• For business-to-consumer services (Article 45): "the place of taxation is the place where the supplier is established".

So when you design an app for a company in Germany, the supply is taxed in Germany. But you're not in Germany. Article 196 of the Directive moves the liability to the customer:

VAT shall be payable by any taxable person, or non-taxable legal person identified for VAT purposes, to whom the services referred to in Article 44 are supplied, if the services are supplied by a taxable person not established within the territory of the Member State.

That is the reverse charge. Your client works out the German VAT on your fee, declares it in their own VAT return, and (in most cases) claims it back in the same return. No money moves to you or from you. Your invoice shows no VAT line.

If you add 19% German VAT to your invoice anyway, you have collected a tax you have no registration to pay over. The client's accountant will reject the invoice, and you will have to issue a corrected one.

What to put on the invoice for an EU business

The EU's invoice rules are written for EU-registered businesses. Strictly, Article 219a points invoicing for a reverse-charged service to the rules of the member state where the supplier is established, and you have none. So the EU's list of mandatory invoice fields doesn't bind you the way it binds a Dutch freelancer.

Your client still has to justify the reverse charge in their own books, though. Their accountant will want to see the same things an EU invoice carries. Two are worth adding every time:

1. 1.The client's VAT identification number. It begins with a country prefix (DE, NL, FR, IE and so on). Check it's live with the European Commission's VIES checker before you send. A valid VAT number is also your best evidence that the client is a business.
2. 2.The words "Reverse charge". Article 226(11a) requires EU invoices to carry "the mention 'Reverse charge'" when the customer pays the VAT. Some clients ask for a longer line naming Article 196. Either is fine; it costs you nothing.

Neither replaces anything Indian GST requires. Both sit alongside it.

What if the business has no VAT number? Some very small EU businesses aren't VAT-registered. Don't respond by adding EU VAT yourself. Ask the client how they account for services bought from abroad, keep their answer on file, and invoice without VAT.

What about EU consumers?

Most Indian freelancers bill businesses. But if you coach individuals, edit a novelist's manuscript or design a wedding website for a couple in Lisbon, your client is a consumer.

For most services you perform yourself, the Article 45 general rule applies: the place of taxation is where the supplier is established. That's India. No EU VAT.

The exception is telecommunications, broadcasting and electronic services. Under Article 58, the Commission's summary says these are "taxed where the customer resides". If you sell an automated digital product to EU consumers (a SaaS subscription, a paid template library, a self-serve online course), EU VAT can apply at the customer's rate.

For a business based outside the EU, the route is the non-Union One Stop Shop. Ireland's Revenue describes it as available to "suppliers who are not established, and have no fixed establishment, in the EU", and it "covers all services supplied to non-taxable persons in the EU". You register in one member state and file one return for EU consumer sales. Under the Commission's OSS guidance, the €10,000 small-seller threshold is only for businesses established in a single member state, so don't assume it covers you.

Whether a particular service counts as "electronic" is a line-drawing question. Live, human-delivered work usually isn't. If you sell anything automated to EU consumers, speak to a VAT adviser before your first sale, not after.

The Indian side: it's still an export

The EU side tells you not to charge VAT. Indian GST asks a separate question: is this an export of services? For a typical EU business client, paying from abroad, for work you do in India, yes. The five conditions are in our USD invoicing guide, and they don't change because the currency is euros.

As an export, it's zero-rated. You have two choices:

• With an LUT on file: no IGST. The invoice carries the export endorsement. CBIC's invoice rules give it as "SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF IGST".
• Without an LUT: you charge IGST, pay it, and claim a refund. For a freelancer, that's months of your money sitting with the government.

If you haven't filed this year's LUT, here's how to file Form GST RFD-11. It's free and takes about fifteen minutes.

For exports, CBIC's rules also ask for the recipient's name and address and the country of destination. Put the client's full EU address on the invoice, with the country spelled out.

So an export invoice to an EU business carries two "no tax here" lines from two different systems:

• "Reverse charge", for the client's EU VAT return.
• The LUT endorsement, for your Indian GST return.

They don't conflict. Each is for a different tax authority.

Euros on the invoice, rupees in your books

Bill in EUR. Your client expects it, and it avoids a conversion argument later. But your GST return and your books are in INR, so each euro invoice needs a rupee value as well.

That rupee value comes from the exchange rate for the invoice date, not the rate your bank gives you when the money lands. The two will differ, and the difference is a foreign exchange gain or loss. The three exchange rates on a foreign invoice are explained separately. Pick one basis with your CA and use it for every invoice.

Worked example: a Pune designer and a Berlin startup

Priya is a UI designer in Pune. She is GST-registered and filed her LUT for FY 2026-27 in April. On 5 October 2026 she invoices Kranich Labs GmbH, a startup in Berlin, for a dashboard redesign.

What happens next:

• Kranich Labs records German VAT on €3,000 in its own return under the reverse charge. Priya never sees that number.
• Priya reports the invoice in GSTR-1 as a zero-rated export, at the rupee value.
• The EDF clock. Under the 2026 FEMA export regulations, Regulation 3(2), an exporter of services files an EDF "within 30 days from the end of month in which invoice for services has been raised". For an October invoice, that's 30 November 2026, and one EDF can cover all of October's invoices. Regulation 2(1)(e) now defines software to include "drawing, design", so Priya's work counts, and that fixes the timing. See what changed for designers when SOFTEX went away.
• The realisation clock. Regulation 5 gives nine months from the invoice date to bring the money in, so 5 July 2027. If Kranich pays on 4 November, this is irrelevant. If it pays late, this is the date to watch.

Five mistakes that get invoices sent back

1. 1.Adding EU VAT. You aren't registered for it, and the client's accountant will reject the invoice.
2. 2.Leaving out the client's VAT number. It's the first thing an EU accounts team looks for.
3. 3.Writing "GST 0%" with no endorsement. Indian rules ask for the export endorsement on the invoice. Print it in full.
4. 4.Converting the invoice to INR. Bill in EUR. Keep the rupee figure for your own records and return.
5. 5.Treating the UK as the EU. A London client is not covered by anything above. UK VAT is its own system.

Keeping it right every month

The VAT part is simple once it's set up: one client VAT number, one "Reverse charge" line. The harder part is month after month: the endorsement, a rupee value for every euro invoice, and knowing which invoices are still unpaid as the nine-month clock runs.

Mavoin makes export and GST invoices from one account, and tracks paid and outstanding amounts in INR, with a CSV export of your invoices when your CA asks. It's ₹199/month, with a 30-day trial and no card to start. If you only need one invoice today, the free export invoice generator opens in euros with the LUT endorsement in place.

Mavoin is not a Chartered Accountant service. Verify GST, FEMA and EU VAT specifics with your CA and, for EU VAT, an adviser in the client's country.