VAT is the part of cross-border selling that quietly breaks stores. It rarely stops a launch, but it produces the letter from a tax authority eighteen months later. This is the practical version of what Shopify merchants selling into the EU need to have configured.
The €10,000 threshold changes everything
Below €10,000 of annual B2C sales into other EU countries, you can charge your home country's VAT rate. Above it, you must charge the customer's local rate — 19% in Germany, 25.5% in Finland, 22% in Italy. The threshold is cumulative across all EU countries, not per country.
OSS: one registration instead of twenty-seven
The One Stop Shop scheme lets you register in a single member state and file one quarterly return covering all EU sales. Without it you would need a VAT registration in every country you sell to. If you sell across the EU and are above the threshold, OSS is not optional in practice.
Configuring it in Shopify
Settings → Taxes and duties → European Union. Enter your OSS registration and Shopify applies destination-based rates automatically per market. Get the 'include tax in prices' setting right for each market too: EU consumers expect the price they see to be the price they pay.
Non-EU sellers: the extra layer
If you ship from outside the EU — which includes Turkey — consignments under €150 fall under IOSS, and above that the customer faces import VAT and duty at the border. Silently passing that cost to the buyer is the single fastest way to generate refund requests.
DDP versus DAP, and why it decides your conversion rate
Delivered Duty Paid means you collect duty and VAT at checkout and the parcel arrives clean. Delivered At Place means the courier bills the customer on the doorstep. DAP looks cheaper in your shipping settings and reliably costs you 30%+ of conversions on international orders.
UK is a separate country now
Post-Brexit, the UK has its own VAT registration threshold and rules. Selling to both the EU and the UK means two registrations, two returns and separate configuration in Shopify Markets. Plan for it as two markets, not one.