Sending VAT invoices as a small business (SME) can be confusing, especially when you are just starting. At Freeberry, we’ve been there and realised that we could use our 15 years of experience to help small businesses send VAT-compliant invoices quickly, conveniently and professionally.
The purpose of this article is to shed light on how to send VAT invoices as a small business and to provide you with sufficient information and tools to create your professional invoices and how to create VAT deductible invoices even if you are not a VAT payer.
Sending VAT invoices as a small business owner in the EU
Being an entrepreneur offers freedom, but it also comes with the responsibility of complying with legal regulations—especially in invoicing. To stay competitive, you must calculate costs carefully and ensure your services or products bring profit while offering value. Crafting professional, compliant invoices is key to maintaining trust and streamlining payments. This makes your business a reliable partner across the EU.
You might be wondering if I can send invoices with 0% VAT for the companies. Or maybe you are thinking about how to deduct the VAT if you are not a VAT-registered small business owner.
Understanding VAT & Invoicing as a Small Business (SME)
In general, most businesses are required to obtain a tax identification number (TIN) or VAT ID, which allows you to issue invoices to other businesses and avoid the issue of double taxation.
For example, in Estonia, if your annual turnover exceeds €40,000, you must register your business for VAT and obtain a VAT ID. But what if your income is below that threshold and a client requests a VAT-free invoice? Don’t worry—there are ways to handle this situation.
Two Common Scenarios for Small Business Invoicing:
- Register as a VAT Payer:
Registering for VAT, even below the threshold, means familiarising yourself with the reporting and accounting requirements. This allows you to issue VAT-compliant invoices but also means more admin, such as filing tax returns and annual reports. Hiring an accountant or using accounting software may be necessary. The most desirable countries to run your online businesses are outlined in the article: TOP European countries for Freelancers. At Freeberry, we can help you open your virtual company in Estonia for smooth operation within Europe.
- Use an Invoicing Solution like Freeberry:
If you prefer to avoid the complexities of VAT registration, a solution like Freeberry can be the perfect alternative. With Freeberry, you can use a virtual company to issue invoices that comply with VAT regulations, even if you’re not VAT-registered.
Freeberry takes care of your VAT requirements, and you only pay a flat 5% fee on processed payments—saving you time, money, and effort.
Both options are great and depending on your preferences, Freeberry can help you with both scenarios and further provide comprehensive support and consultation.
Key Benefits of Using Freeberry for Invoicing
- No Need for VAT Registration: Freeberry allows you to invoice companies without registering for VAT yourself, while still offering VAT-compliant invoices.
- Simple Invoicing Process: Our platform lets you create and send professional invoices in minutes, ensuring accuracy and compliance with VAT regulations.
- Transparent & Fair Pricing: We charge only a 5% flat fee per processed payment—no hidden costs or complex fee structures.
- Streamlined Business Management: Freeberry’s dashboard helps you manage all your invoices in one place, track payments, and even send reminders for unpaid bills, keeping your finances organized and stress-free.
How Freeberry Can Help Your Business Grow
Whether you’re a freelancer, small business owner, or just starting your entrepreneurial journey, Freeberry simplifies the invoicing process and allows you to focus on what matters most: growing your business. You’ll save time and avoid the hassle of setting up your VAT structure while still providing your clients with professional, VAT-compliant invoices.
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