Services provided electronically, telecommunications, radio and television services

Services provided electronically, telecommunications, radio and television services (TBE services) are generally taxable at the service recipient’s location (recipient location). This applies regardless of whether the services are B2B services to business operators (general rule) or B2C services to non-business users. Microenterprises are exempted from taxation at the recipient location.

If services are being taxed at the recipient location, businesses must determine for each individual service where the customer is located. To limit the time and effort required to determine the recipient location, there are EU-wide recipient location assumptions. In addition, the value added tax payable in other EU Member States on TBE services provided to consumers can be declared via the Value Added Tax One Stop Shop.

An electronic service is a service that is provided over the internet or a similar electronic network, the provision of which is by its nature essentially automated and entails only limited human involvement, and which is not possible without information technology.

Electronic services include:

Provision of websites, web hosting, online data warehousing (electronic data storage and retrieval)
Provision of software and updates
Provision of images, texts and information (e-books, online newspapers)
Provision of databases (e.g. search engines)
Provision of music, films and games, including gambling and lotteries, as well as broadcasts and events from the areas of politics, culture, arts, sports, science, and entertainment
Provision of electronic distance learning services

Services not considered electronic services include:

Deliveries based on electronic orders
Deliveries of physical data media (e.g. CD-ROMs, CDs, diskettes, DVDs etc.)
Deliveries of printed matter and games on CD-ROMs
Non-automated distance learning
Repairs to IT equipment
Communications via email (including consulting services)
Internet access and videophone use

Recipient location assumptions

If TBE services can only be received at a specific location, and if reception of the service requires the physical presence of the service recipient (e.g. for telephone booths or with the provision against payment of internet access through WLAN hotspots, internet cafés etc.), it is assumed that the service recipient is based in that location.

If the services are provided via a landline connection, it is assumed that the recipient location is situated at the landline connection point.

When services are provided over mobile networks, the country code of the SIM card is the decisive factor.

If a decoder, programme card or satellite card (e.g. for radio services) is needed to receive the services, the assumption applies that the recipient location is the place in which this device or card is located. If that location is not known, it is assumed that the service location is at the address to which the programme or satellite card was sent.

In all other cases, two non-contradictory forms of proof will suffice for the business to determine the recipient location. Proofs can include the billing address, IP address or bank details, as well as any other business-relevant information.

The tax office may refute these assumptions if there is evidence of incorrect or improper use of the assumptions by the service provider.

Service provider assumption

For electronically provided other services and for telephone services provided over the internet, it is presumed that an enterprise involved in service provision is operating in its own name but for the account of another ("provider") and must therefore be regarded as a service provider vis-a-vis its respective customer if the service is provided over a telecommunications network, an interface or a portal (e.g. via an app store). This assumption is refutable under the following cumulative conditions (Article 9a Regulation (EU) 282/2011, as amended by Regulation (EU) 1042/2013):

All invoices/receipts must show the service and its service provider;
the business involved in provision of the service
- authorises or approves neither the provision of this service nor billing with the service recipient and
- does not define the general terms and conditions for provision of the service;
this is expressed in the contractual agreements between the parties.

A business involved in service provision would be, for example, a telecommunications company that on the one hand bills the end consumer for the electronically provided service while simultaneously providing that consumer with a telecommunications network in return.

Micro business owners

For simplification purposes, tax on TBE services provided to non-entrepreneurs by micro business owners, is to be paid not at the recipient location but rather at the place of business. Micro business owners are understood to include enterprises which

are operated in only one EU Member State and do not own any premises in any other Member State and
have not exceeded the applicable turnover limit of 10.000 Euro.

All TBE services to non-entrepreneurs resident in other Member States as well as intra-community distance sales must be taken into account when calculating the 10.000 Euro turnover limit. Where the relevant turnover or that in the current calendar year exceeds the threshold value of 10.000 Euro or the enterprise providing the service does not apply the new threshold regulations, tax is to be paid on the turnover at the place of receipt.

Any waiver must be brought in writing within the deadline for submitting an advance return for the preliminary notification period of a calendar year in which such a service is provided for the first time, and is binding upon the enterprise for at least two calendar years. The written declaration can also be made by recording turnover via a declaration in the One Stop Shop (see Austrian VAT Guidelines 2000, margin number 3918 and following).

Further links

Legal bases

Place of taxation for services to businesses: section 3a paragraph 6 of the Umsatzsteuergesetz (UStG)
Taxation at recipient location for TBE services to non-business users: section 3a paragraph 13 of the UStG
Conditions for refuting the service provider assumption: atricle 9a of the Regulation (EU) 1042/2013
Simplification for micro business owners: article 3a paragraph 5 of the Annex to the Umsatzsteuergesetz (UStG)

Translated by the European Commission

Last update: 1 January 2024

Responsible for the content: Federal Ministry of Finance