When submitting B2B (Business-to-Business) transactions for VAT reporting, both the buyer and seller must hold valid VAT numbers.

If a transaction does not include valid VAT numbers on both sides, hellotax is legally required to reclassify the transaction as a local B2C (DOMV) transaction. This process is automatic and no longer optional for clients.

🧾 Why is this important?

Under EU VAT law, valid VAT numbers are a mandatory requirement for reverse charge B2B transactions. If a buyer VAT number is missing or invalid (the most common scenario for hellotax clients), the transaction cannot be treated as B2B and cannot be included in your EC Sales Report.

Instead, the transaction must be reclassified as B2C, meaning VAT will be due locally.

⚙️ What happens in the hellotax system?

• Any B2B transaction missing a valid buyer VAT number will be automatically reclassified as a B2C (DOMV) transaction.

• This reclassification is mandatory and carried out by hellotax in compliance with EU legal requirements.

• The VAT due on these transactions will be reflected in your VAT return.

📬 Notifications

• You will receive an automatic email notification if invalid or missing VAT numbers are detected in your transactions.

• You can manage which email address receives these alerts under Account Settings > Notifications.

✅ What you can do

While the reclassification is mandatory, you can still take preventive steps:

1. Verify VAT numbers in advance

   • Use the official EU VIES tool: VIES VAT Validation.

   • Ensure your clients provide their correct VAT numbers at the time of sale.

2. Keep client data up to date

   • Double-check customer records regularly to avoid surprises during reporting.

🤝 Need help?

If you have questions about how this reclassification affects your VAT liability or reporting, please reach out to your Account Manager or submit a support request via your client portal.

⚠️ Important: Failure to provide valid VAT numbers for B2B transactions will always result in reclassification to B2C. This is a legal obligation, not a system setting or client choice.