A VAT ID (also called a Tax Number) is a unique number given to businesses that are registered for VAT (Value Added Tax).
When do customers use their VAT ID?
When they want to buy without VAT (tax-free purchase) under certain conditions.
Mostly used for business-to-business (B2B) transactions inside the EU or other specific regions.
How does it work?
Customers enter their VAT ID during checkout.
If the VAT ID is valid, the invoice will not include VAT (zero-rated VAT).
This makes the purchase cheaper for the customer.
Important:
Always verify the customer's VAT ID if you plan to issue a tax-free invoice. Incorrect VAT handling can cause tax problems later.