Reverse charge (omvendt betalingspligt) — B2B invoicing across EU borders

When you sell services to a VAT-registered business in another EU country, the VAT liability shifts from you to your client — this is called reverse charge (omvendt betalingspligt). You invoice without VAT, and your client accounts for it in their own country. Here is what you need to know and exactly what to write on your invoice.

When does reverse charge apply?

Reverse charge applies when all three of the following are true:

  • You are selling a service (not physical goods)
  • Your client is a VAT-registered business in another EU member state
  • The service falls under the general B2B place-of-supply rule (the service is "used where the buyer is established")

Common freelance services that typically fall under this rule: consulting, copywriting, design, web development, photography, translation, marketing, and other professional services supplied remotely to EU business clients.

What to write on the invoice

You must include the term "reverse charge" (or "omvendt betalingspligt" in Danish) on the invoice and state that the buyer is liable for VAT. Leaving the term off is a formal invoicing defect (VAT Directive Art. 226(11a)) and should be corrected — but for Art. 196 services it does not, on its own, undo the substantive shift of VAT liability to the buyer.

Approved invoice note (cross-border B2B services): "Reverse charge — the customer is liable for the VAT (VAT Directive Art. 196)."

You also need:

  • Your VAT number (CVR + DK prefix, e.g. DK12345678)
  • The client's EU VAT number (VIES-verified)
  • No VAT amount on the invoice — the total is the net amount

In PennaPay, select "Reverse charge (EU B2B services)" from the tax type dropdown. The correct note is added automatically, and the system verifies the client's EU VAT number through VIES.

Services (Art. 196) vs. goods (Art. 138) — a critical distinction

These two situations look similar but are legally different. Do not confuse them:

Cross-border B2B services — Art. 196 (reverse charge) You sell a service to an EU business client. VAT liability shifts to the buyer (reverse charge). Your invoice carries the Art. 196 note. The buyer accounts for VAT in their own country.
Intra-EU goods — Art. 138 (zero-rated exempt) You ship physical goods to a VAT-registered EU buyer. The supply is zero-rated and exempt in Denmark (Momsloven § 34(1)(1)). The buyer accounts for acquisition VAT (erhvervelsesmoms) in their country. This is NOT reverse charge — do not use the Art. 196 note on goods invoices.
Why this matters: Printing "reverse charge (Art. 196)" on a goods invoice mischaracterises the transaction and risks the zero-rating being denied at a tax audit. If you ship physical goods to an EU client, use the "Intra-EU goods" tax type in PennaPay instead.

Do you need to be VAT-registered to use reverse charge?

Yes. To issue a valid reverse-charge invoice you must be VAT-registered yourself (have a Danish VAT number, i.e. your CVR prefixed with DK). The reason is reporting, not rate: cross-border B2B services have to be declared on the EU Sales List, and you can only file that as a VAT-registered business (Momsloven § 47, stk. 2). Note that reverse charge itself puts the supply outside Danish VAT — there is no Danish VAT on the line to "shift" — but the obligation to register and report still applies.

Bookkeeping: PennaPay and reverse-charge invoices

PennaPay records every reverse-charge invoice with the correct Art. 196 notation and VIES verification status. Reporting happens in two separate places: on your VAT return (momsangivelsen) cross-border B2B services go in "Rubrik B – ydelser"; and you separately file the EU Sales List — the per-customer listeangivelse that Skattestyrelsen calls "EU-salg uden moms". They are two different systems, not one line. Export your invoices as CSV or sync to Billy for your accountant to review.

Need templates for international B2B work? → Browse 33 free Danish invoice templates
Disclaimer: This is general information about Danish VAT rules as of 2026, not tax or legal advice. Rules can differ for your situation — especially mixed-activity businesses — so check with your accountant (revisor) or SKAT before relying on it.

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Select "Reverse charge (EU B2B services)" in PennaPay. The correct Art. 196 note is added automatically and the client's EU VAT number is verified.

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