Set up Austrian taxes in your Shopify store

In this article, we’ll discuss:

• Tax settings
  • Display product prices including VAT
  • Display product prices excluding VAT
• Tax rates in Austria and the EU
  • Selling physical goods to customers in Austria
  • Selling physical goods to customers in other EU countries
    • Selling within the micro-business threshold
    • Surpassing the micro-business threshold
    • Selling with country-specific VAT registrations
  • Selling digital goods
    • The VAT rules when selling digital services
• Invoices

If you want to charge VAT to some customers in your Shopify store but not others, you have two options, depending on how you would like to display product prices.

If you sell mainly to consumers (B2C), you may want to display product prices with VAT included.

To display your product prices with VAT included:

1. In your Shopify admin, go to Settings → Taxes and duties.
2. In the Additional configuration section, turn on Include sales tax in product price and shipping rate.
3. Click Save to apply the changes.

Optionally, you can enable dynamic tax inclusion. This Shopify feature automatically includes or excludes tax based on the customer's region and adjusts the tax rate accordingly.

Tax display is set for each market. To activate dynamic tax inclusion:

1. In your Shopify admin, go to Markets and click the market you want to configure.
2. In the Inherited section, click the + icon next to Taxes and duties.
3. Under Tax display, select Dynamic tax display, then click Done.
4. Click Save to apply the changes.

If your customers are mostly businesses (B2B), you can choose to display your product prices as excluding VAT.

To display your product prices excluding VAT:

1. In your Shopify admin, go to Settings → Taxes and duties.
2. In the Additional configuration section, turn off Include sales tax in product price and shipping rate.
3. Click Save to apply the changes.

To disable dynamic tax inclusion in a market and show VAT as a separate line at checkout:

1. In your Shopify admin, go to Markets and click the market you want to configure.
2. In the Inherited section, click the + icon next to Taxes and duties.
3. Under Tax display, select Show as line item, then click Done.
4. Click Save to apply the changes.

As of 2026, the standard VAT rate in Austria is 20%.

Reduced VAT rates of 13% and 10% also apply to certain products: for example, firewood is taxed at 13%, while hotel stays, passenger transport, books, and newspapers are taxed at 10%.

From July 1, 2026, a new reduced rate of 4.9% applies to a defined list of selected food products, such as milk, butter, eggs, vegetables, fruit, rice, flour, pasta, bread, and salt. Most other groceries remain taxed at 10%, with only a few agricultural items, such as live animals, seeds, and animal feed, taxed at 13%.

Most digital services, such as streaming, software, and apps, are taxed at the standard 20% rate, although e-books and digital publications are taxed at the reduced 10% rate.

When you sell physical goods to customers in Austria, you should always charge Austrian VAT—regardless of whether the customer is VAT-registered.

When selling to non-VAT-registered customers outside of Austria but still within the EU, you do collect VAT.

The rate you charge depends on whether you exceed the micro-business threshold of €10,000 (excluding VAT).

If you're selling to VAT-registered businesses in other EU countries, you shouldn't charge VAT.

Shopify calculates VAT based on the tax registrations and tax settings you've configured.

If your cross-border B2C sales to customers in other EU countries stay at or below €10,000 (excluding VAT) in both the current and the previous calendar year, you can continue charging Austrian VAT to non-VAT-registered customers throughout the European Union.

This rule only applies if your business is established only in Austria and your goods are shipped from Austria. You can also choose to charge the customer's country rate from the first euro, but that choice binds you for two calendar years.

This €10,000 threshold is separate from the EU SME VAT exemption introduced in 2025, which has its own eligibility requirements and registration rules.

To configure Shopify to charge Austrian VAT on eligible cross-border sales:

1. In your Shopify admin, go to Settings → Taxes and duties.
2. In the Tax regions section, click European Union.
3. In the Collect VAT cross-border section, click Collect VAT.
4. In the Collect across the EU window, select Collect using your home country registration.
5. Select your Country of registration and enter your VAT number. If you've applied for a VAT number but haven't received it yet, leave this field blank. You can update it later.
6. Click Collect VAT to save your changes.

Once your cross-border B2C sales exceed the €10,000 threshold, you must charge VAT based on the customer’s country. In practice, this means customers in different EU countries are charged different VAT rates, ranging from 17% to 27%.

For example, if your business is located in Austria and you sell goods to consumers in Belgium and Germany, and your total sales to other EU countries stay at or below the €10,000 threshold, you charge the Austrian VAT rate of 20%.

However, if your combined sales to customers in all other EU countries exceed the €10,000 threshold, you charge Belgian VAT at 21% on goods sold to Belgium and German VAT at 19% on goods sold to Germany.

Registering for VAT in every EU country you sell to can quickly become time-consuming.

The One-Stop Shop (OSS) Union scheme solves this: you still charge VAT at the rate of the country you’re selling to, but you only need to file one OSS VAT return in Austria.

To charge your Belgian and German customers the correct VAT rate, you need to set your tax settings accordingly.

Shopify lets you select OSS as your VAT registration type so it can apply the correct VAT rates automatically.

To set VAT rates for the OSS scheme and charge your customers' shipping country VAT rate on all orders:

1. In your Shopify admin, go to Settings → Taxes and duties.
2. In the Tax regions section, click European Union.
3. In the Collect VAT cross-border section, click Collect VAT.
4. In the Collect across the EU window, select Collect using a One-Stop Shop (OSS) registration.
5. Select your Country of OSS registration and enter your VAT number. Leave this field blank if you've applied for a VAT number but don't have one yet. You can update it later.
6. Click Collect VAT to save your changes.

Now your customers' shipping country VAT rate will automatically apply to all EU sales.

Some businesses maintain separate VAT registrations in each EU country where they sell.

If this applies to you, add the local VAT registration number for each country in Shopify.

Shopify will then use this information to apply the correct VAT rate based on your registered tax obligations.

To add a local VAT registration number:

1. In your Shopify admin, go to Settings → Taxes and duties.
2. In the Tax regions section, click European Union.
3. In the Collect VAT in an EU country section, click Collect in another location if you already have a registration.
4. Select the Country and enter your VAT number. Leave this field blank if you've applied for a VAT number but don't have one yet. You can update it later.
5. Click Collect VAT to save your changes.

If you can't select the additional country you're VAT-registered in, you may need to create a shipping zone first.

To create a shipping zone:

1. In your Shopify admin, go to Settings → Shipping and delivery.
2. In the Shipping profiles section, click the profile you want to add the zone to (for example, General profile).
3. In the Shipping zones section, click + Zone.
4. Name the zone, add the country (or countries) you're VAT-registered in using the search bar, and click Done.
5. Add shipping rates to make the zone available.
6. Click Save to apply the changes.

Selling digital goods from Austria to other EU countries comes with special rules, so it's worth understanding exactly what counts as a “digital service” first.

Digital goods or services include radio and television broadcasting services, telecommunication services, and electronically supplied services, such as online magazines, music, films, and games.

Just because a company uses the internet to facilitate trading doesn't mean it provides e-services.

For example, selling goods where the order and processing happen electronically (as through a Shopify store) isn't a supply of digital services.

This counts as a regular sale of goods and follows the usual VAT rules described above.

If you supply digital services from Austria to other EU countries, the same €10,000 threshold described above applies.

Your digital sales count toward the same EU-wide total as your physical goods sales, not on top of it.

This means that as long as your combined gross revenue from goods and digital services to non-VAT-registered customers elsewhere in the EU stays below €10,000, you can keep charging Austrian VAT.

Once that combined total exceeds €10,000, you must charge VAT at the rate of the customer's country for both goods and digital services going forward.

If you sell digital services to VAT-registered businesses, they're responsible for accounting for any VAT due in their own country.

Registering for VAT in multiple countries can take a lot of time and effort. Shopify store owners in Austria selling to other EU countries can register for the One-Stop Shop (OSS) instead.

The OSS scheme lets you report the VAT due on your services in your own country through a single web portal.

Once you've set up your tax rates correctly in your store, Sufio automatically creates valid invoices with an exact breakdown of the VAT charged.

Invoices can be created in multiple languages and include all the details needed to comply with EU invoicing legislation.

Issuing invoices with the correct tax breakdown is crucial for your bookkeeping and tax purposes.

If you are selling to businesses (B2B), Sufio invoices include all the required information, as well as the VAT registration number (UID-Nummer or Umsatzsteuer-Identifikationsnummer) of your online store and your business customers