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VAT 2023 practical manual.

Cross-border payment concept

A payment will be considered cross-border when the payer is located in a Member State and the beneficiary is located in another Member State or in a third country or territory.

For these purposes, the payer is considered to be located in the corresponding Member State:

  1. To the number IBAN of the payer's payment account or to any other identification means that allows unequivocal identification and providing the location of the payer, or in the absence of such identification means.

  2. To the code BIC or any other identifier code of the entity that unequivocally identifies and provides the location of the payment service provider acting on behalf of the payer.

As regards the beneficiary, he or she will be deemed to be located in the relevant Member State or third territory or country:

  1. To the IBAN number of the beneficiary's payment account or to any other identification means that allows unequivocal identification and providing the location of the beneficiary, or in the absence of such identification means.

  2. To the BIC code or any other identifying code of the entity that unequivocally identifies and provides the location of the payment service provider acting on behalf of the beneficiary.

• Cross-border payments excluded from the reporting obligation

Cross-border payments will not be reported when, in the course of a calendar quarter, the payment service provider does not provide the same beneficiary with payment services corresponding to more than 25 cross-border payments.