Short answer
Starting 1 July 2028, the EU's VAT in the Digital Age (ViDA) package will apply deemed supplier rules to platforms that facilitate short-term accommodation rental and passenger transport by road. If your platform qualifies, you will be responsible for collecting and remitting VAT on those supplies when the underlying supplier (for example, an individual host or a small business) does not charge VAT themselves. This means you need to prepare now to avoid compliance gaps.
Check if your platform is in scope
The deemed supplier rules under ViDA apply from 1 July 2028 to platforms that facilitate supplies in two sectors: short-term accommodation rental and passenger transport by road. If your business provides a digital platform that connects customers with suppliers in these sectors, you may be treated as the supplier for VAT purposes. This means you would need to charge and remit VAT on transactions that fall under the rules, even if the actual service provider is an individual or a small business that is not VAT-registered.
The rules are intended to cover situations where the underlying supplier does not account for VAT, ensuring a uniform approach across EU countries. However, the precise scope can depend on factors like the level of control your platform has over the supply. Official guidance is still evolving, so you should monitor updates from the European Commission and your national tax authority. For now, start by mapping your business model: do you set terms, collect payment, or otherwise facilitate the supply? This will help you assess whether the rules likely apply to you.
- Identify if your platform handles short-term accommodation rental or passenger transport by road.
- Review your platform's role: do you control terms, pricing, or payment collection?
- Keep an eye on official EU and national guidance for detailed scope definitions.
- Consider consulting a tax advisor if your business model has any ambiguity.
Understand the deemed supplier mechanism
When the deemed supplier rules apply, your platform becomes responsible for charging and remitting VAT on the supplies. The VAT is due in the EU member state where the underlying service is considered to be consumed, typically where the customer is located. You will need to calculate VAT at the applicable rate, issue invoices (or adjust existing ones), and file VAT returns accordingly. This shifts the administrative burden from the individual suppliers to you, the platform, which can be a significant operational change.
It is important to note that the deemed supplier rules do not apply when the underlying supplier is already VAT-registered and accounts for VAT normally. To avoid double taxation or errors, your platform must verify the VAT status of all suppliers in the affected sectors. Practical steps include collecting VAT identification numbers, checking them against the VIES database where applicable, and maintaining records of each supplier's status. If a supplier is VAT-registered, they continue to handle VAT; if not, you step in.
- Collect VAT registration details from every supplier in the affected sectors.
- Determine the correct VAT rate for each member state of consumption.
- Update your systems to calculate, collect, and remit VAT on covered transactions.
- Keep evidence of supplier VAT status for each transaction to support your filings.
Plan for VAT registration and use of OSS
Once you know the deemed supplier rules apply, you must decide how to handle VAT registration and filings. The existing One Stop Shop (OSS) scheme can simplify cross-border B2C VAT obligations. Under the Single VAT Registration (SVR) reforms, which are effective from 1 January 2027, OSS will be expanded to cover more scenarios, including platform supplies under the deemed supplier rules. This means you may be able to use the OSS portal in one EU country to account for all VAT due across the EU, avoiding the need for multiple VAT registrations.
However, OSS is not always the right choice. Depending on your business model and the nature of your supplies, you might need to register directly in each member state where you make supplies, which can be more burdensome. Start evaluating your options now: consider the volume of transactions per country, the complexity of your supply chain, and whether you already have local entities. The European Commission has published revised explanatory notes and OSS guidelines (updates in 2026) to reflect the SVR changes, so use those as a reference. Your accounting and IT systems need to integrate with OSS to handle per-country reporting and correct VAT rates.
- Evaluate whether using OSS or direct VAT registration is more suitable for your platform.
- Ensure your accounting software supports VAT reporting per member state.
- Set up data flows from your transaction system to OSS filings or local returns.
- Plan for regular VAT payments (for OSS, usually quarterly) and consider cash flow impacts.
Update supplier contracts and communication
The shift in VAT responsibility will affect your suppliers, especially individuals who are not VAT-registered. Under the new rules, they will no longer need to worry about charging VAT on those supplies; your platform will handle it. This is intended to simplify life for small suppliers. However, you need to communicate clearly with them to avoid confusion and ensure smooth operation.
Update your terms of service to explain that the platform will collect and remit VAT on covered transactions. Consider revising commission structures or fees if needed, as the VAT handling may change the net amounts. Provide suppliers with clear guidance on how the rules affect them, especially those who are VAT-registered: they must continue to charge VAT, and your platform must not double-charge. Establish a supplier onboarding process that captures VAT details and recertifies them periodically, for example every year, to keep information current.
- Revise platform terms to clarify VAT handling responsibilities.
- Inform suppliers about the new VAT collection process and its impact.
- Create a standard form to collect and verify supplier VAT status.
- Set a schedule for rechecking supplier VAT registrations, such as annually.
Monitor official sources and timelines
ViDA is being rolled out in phases. The package was adopted on 11 March 2025 and published in the Official Journal on 25 March 2025. From 1 January 2027, minor clarifications affect OSS and IOSS users. The deemed supplier rules for platforms start on 1 July 2028. Digital Reporting Requirements for cross-border B2B transactions will follow on 1 July 2030, and full harmonization of domestic digital reporting will be in place by 1 January 2035. Since you are reading this in September 2026, you have roughly 21 months to prepare for the deemed supplier rules, but system changes can take time, so start early.
Official guidance continues to evolve. The European Commission's ViDA page (taxation-customs.ec.europa.eu) is the primary source, along with the legal texts: Directive (EU) 2025/516, Regulation (EU) 2025/517, and Implementing Regulation (EU) 2025/518. The Commission also publishes work programmes and explanatory notes; for example, revised OSS guidelines were issued in July 2026. In addition to EU sources, check your national tax authority's website for local implementation measures and any specific rules. If you operate in the UK, be aware that Making Tax Digital for Income Tax is a separate UK system for income tax reporting, not VAT, and does not align with ViDA.
- Bookmark the European Commission's ViDA page and check for updates regularly.
- Read Directive (EU) 2025/516 and related acts for the exact legal wording.
- Monitor your national tax authority's guidance for local implementation details.
- Sign up for EU newsletters or alerts to stay informed of new explanatory notes.
What to verify
- The precise scope of the deemed supplier rules is still subject to official clarifications; check for updates.
- Member states must implement the directive into national law; deadlines may vary, so verify local effective dates.
- VAT rates and specific registration rules are not detailed here; consult official sources for your transactions.
- This article is not legal or tax advice; always seek qualified professional guidance.
Questions and answers
What is the deemed supplier rule under ViDA?
Under ViDA, from 1 July 2028, platforms that facilitate short-term accommodation rental or passenger transport by road will be treated as the supplier for VAT purposes when the underlying supplier (e.g., an individual host or small business) does not charge VAT. This means the platform must collect and remit VAT on those supplies to tax authorities in the EU member state of consumption. [1]
Does ViDA apply to platforms based outside the EU?
ViDA applies to supplies deemed to occur within the EU. If a non-EU platform facilitates such supplies in the EU, it may be subject to the rules. The exact obligations depend on factors like the location of the customer and the supplier. You should consult an EU VAT specialist and monitor official guidance for your specific situation. [1]
What is the difference between ViDA and Making Tax Digital in the UK?
ViDA is an EU-wide VAT reform, while Making Tax Digital for Income Tax (MTD IT) is a UK domestic requirement for income tax reporting by sole traders and landlords. MTD IT mandates digital record-keeping and quarterly updates from April 2026 for those with income over £50,000. They are separate legal systems: one for EU VAT, the other for UK income tax. [1][2]
Sources and verification date
- Official source: taxation-customs.ec.europa.eutaxation-customs.ec.europa.eu · Checked
- Official source: gov.ukgov.uk · Checked
- Official source: taxation-customs.ec.europa.eutaxation-customs.ec.europa.eu · Checked