Key takeaways
- The ViDA reforms represent a major EU initiative to modernize and digitalize VAT compliance between 2024 and 2030.
- Digital Reporting Requirements (DRR) will be implemented from 2030, standardizing real-time VAT reporting for cross-border and zero-rated transactions.
- DRR aims to replace outdated systems, improve data standardization, and reduce VAT evasion, though it may increase compliance costs.
- The platform economy rules—covering short-term accommodation and passenger transport—are delayed to 2027, requiring platforms to collect VAT unless providers supply valid VAT IDs.
- The definition of short-term accommodation has been shortened from 45 to 30 days, and small businesses under the 2025 SME scheme may be exempt.
- Simplified VAT registration and reporting via expanded OSS and new single VAT registration rules are postponed to 2027, easing cross-border VAT compliance.
- From 2026, minor updates will expand OSS coverage to energy supplies and adjust VAT thresholds for small businesses.
- Overall, ViDA aims to create a transparent, fraud-resistant, and efficient VAT system, requiring businesses to begin early preparation for compliance.
In short: On May 14, 2024, EU finance ministers in ECOFIN failed to agree on the ‘VAT in the Digital Age’ (ViDA) reforms. Only one member state objected, over the platform economy rules. ViDA covers mandatory e-invoicing and digital reporting by 2030, new platform rules, and single VAT registration, rolled out between 2024 and 2030.
Update: EU finance ministers reached political agreement on the ViDA package on 5 November 2024, and the Council formally adopted it on 11 March 2025.
On May 14, 2024, the European Union faced a setback. The Economic and Financial Affairs Council (ECOFIN) failed to reach a consensus on the proposed ‘VAT in the Digital Age’ (ViDA) reforms. However, only one member state opposed the proposals, specifically those on the platform economy. So it is hoped a compromise will be reached soon. Once approved, the reforms are expected to roll out in stages between 2024 and 2030.
Here are some of the key ViDA proposals put forward:
What are the new ViDA electronic invoicing requirements?
Under ViDA, electronic invoicing will become mandatory by 2030. Invoices will need to use a structured format that complies with the European e-invoicing standard (EN16931). This is a big move away from PDFs and similar formats, which are now seen as inadequate.
The shift underlines the EU’s commitment to reducing VAT fraud and making tax collection more efficient. Hybrid invoices will be allowed, and businesses will have up to ten days after a transaction to issue an invoice. This balanced approach eases the transition for businesses.
When will ViDA digital reporting become mandatory?
ViDA Digital Reporting Requirements (DRR) will apply from 2030 and are another critical part of the reforms. DRR will require businesses to report certain types of transactions, including zero-rated sales and intra-EU acquisitions. It is designed to replace older systems that were less effective at curbing VAT evasion on cross-border transactions.
The new system brings standard rules for reporting invoice data. But it may also bring compliance costs and timing challenges, as each member state develops its own real-time reporting technology.
Why are the revised platform economy rules delayed?
The new ViDA platform economy rules are delayed until 2027. Under these rules, platforms for short-term accommodation and passenger transport must act as VAT collectors. The exception is when providers submit a valid VAT ID and declare how they manage their VAT. Platforms must confirm the VAT charge to avoid tax liability, and member states must verify these IDs.
In an update, small businesses in the 2025 SME scheme may be exempt from these rules. The term for short-term accommodation has also been shortened from 45 to 30 days. In addition, platform facilitation services to end consumers will be taxed where the transaction occurs. This means they are not included in the travel agents' special scheme.
How will ViDA simplify VAT registration and reporting?
ViDA aims to simplify VAT registration, but the single VAT registration proposals have been postponed to 2027. These proposals aim to reduce the need for businesses to register for VAT in EU member states where they are not established. They would do this in three ways:
- Expanding the One Stop Shop (OSS)
- Introducing a new OSS regime for internal transfers of goods
- Extending mandatory reverse charge mechanisms
Planned changes include broader OSS coverage for B2C sales and certain utility supplies. They also include simpler reporting for cross-border transfers of a company's own goods. From 2026, some minor changes are also expected. These include reporting certain energy supplies through the OSS and revising the VAT collection threshold for small businesses.
What should businesses expect from ViDA going forward?
The ViDA reforms are a complete overhaul, designed to streamline VAT processes and fight fraud more effectively. Businesses across the EU should start preparing now, so they can adapt more easily once the changes become law. The transition will be complex, but the long-term benefits of a more transparent and efficient VAT system are clear.
As VAT compliance specialists, we can give your business the full support it needs. We can help you integrate compliant e-invoicing systems and understand the new digital reporting requirements. We can also simplify VAT registration and keep you compliant with the new platform economy rules. Partnering with Taxually means you are well prepared for the changes, with lower compliance risk and smoother operations.
Book a free call with one of our VAT experts to find out how we can help your business grow and succeed, no matter what the regulatory future looks like.
How Taxually handles this
Taxually’s CrossTax handles VAT registration, VAT, OSS and IOSS returns and fiscal representation in the countries you sell into, and checks your sales data against 250+ validation rules before each filing. OneTax then pays every tax authority with one bulk payment in your chosen currency.
Related guides
Frequently asked questions
What are the Digital Reporting Requirements (DRR) under ViDA?
The DRR, effective from 2030, will mandate standardized digital reporting of transactions, including zero-rated sales and intra-EU acquisitions, to enhance VAT transparency and reduce fraud.
Why are the new platform economy rules delayed?
The platform rules for short-term accommodation and passenger transport are postponed until 2027 to allow additional time for technical and regulatory adjustments.
How will the platform economy rules work?
Platforms will be required to collect VAT on qualifying transactions unless providers present a valid VAT ID. Member states will also verify these IDs to ensure compliance.
What exemptions apply to small businesses?
Small businesses under the 2025 SME scheme may be exempt from the new platform rules, easing compliance burdens for microenterprises.
What changes are planned for VAT registration and OSS?
The single VAT registration system and expanded OSS—covering internal goods transfers and certain utilities—are now expected in 2027. These aim to simplify VAT obligations across EU borders.
When will the ViDA reforms be fully implemented?
ViDA reforms will be rolled out progressively from 2024 to 2030, with digital reporting set for 2030 as the final stage.
How should businesses prepare for ViDA?
Businesses should begin updating invoicing systems, integrating digital reporting tools, and reviewing cross-border VAT processes to ensure compliance before enforcement begins.
What are the long-term benefits of ViDA?
ViDA will create a more efficient, transparent, and fraud-resistant VAT environment, streamlining reporting and reducing administrative burdens across the EU.
