Important: This page provides operational guidance for understanding how VAT and sales tax apply within the Debitura workflow. It is not tax advice. Clients and Collection Partners should confirm local requirements with a qualified accountant or tax advisor.
Two separate invoice streams
The Debitura model creates two distinct invoicing relationships. Understanding which invoice comes from whom is essential for VAT clarity.
Invoice Stream | From | To | What It Covers |
Success fee invoice | Collection Partner | Client | Fee charged upon successful debt recovery (percentage of principal) |
Referral fee invoice (revenue share) | Debitura | Collection Partner | Platform commission invoiced after the Collection Partner has received payment |
These are independent streams. Debitura does not invoice the Client for the success fee, and the referral fee should not appear on the Collection Partner's invoice to the Client.
Success fee invoice: Collection Partner to Client
When a debt is recovered, the Collection Partner invoices the Client for the success fee. VAT or sales tax treatment depends on:
The Collection Partner's location and VAT registration status
The Client's location and VAT registration status
Applicable "place of supply" rules for B2B services
Core principle: VAT is added on top
When VAT applies, it is calculated on top of the success fee and shown as a separate line item. VAT is not "included in" or "deducted from" the success fee.
Example: Success fee of EUR 1,000 + VAT at 25% = EUR 250 VAT. Total invoice: EUR 1,250.
The Standard Debt Collection Agreement (SDCA) states that VAT applies to all prices and success fees based on the VAT rate applicable in the Collection Partner's jurisdiction.
Common VAT scenarios
Scenario | Typical VAT Treatment |
Domestic (Collection Partner and Client in the same country) | Collection Partner charges local VAT. Client pays fee + VAT and may reclaim VAT if eligible. |
Cross-border EU B2B (Both in EU, Client is VAT-registered) | Collection Partner issues invoice without VAT (reverse charge). Client self-accounts for VAT in own country. |
EU Partner to non-EU Client | Collection Partner typically does not charge EU VAT (export of services / outside scope). |
Non-EU Partner to EU Client | Non-EU Collection Partner typically does not add EU VAT. EU Client may need to self-account under reverse charge rules. |
U.S. Partner to U.S. Client | Sales tax depends on whether the Client's state taxes debt collection services and whether the Collection Partner has nexus in that state. |
Reverse charge (EU cross-border B2B)
For many cross-border B2B services within the EU, the Collection Partner issues an invoice without VAT, and the Client self-accounts for VAT in its own country. This is known as "reverse charge."
When reverse charge applies, the Collection Partner's invoice should include the Client's VAT ID and appropriate reverse charge wording per local invoicing rules.
Referral fee invoice: Debitura to Collection Partner
Debitura invoices Collection Partners for its revenue share (referral fee) after the Collection Partner has received payment from the Client or Debtor. Debitura issues invoices monthly based on paid payouts.
Collection Partners configure their billing details, including VAT number, in the Partner Portal billing settings. For details on billing configuration and payment reconciliation, see the segment-specific billing documentation.
Impact by actor
Client
Receives the success fee invoice from the Collection Partner (not from Debitura)
VAT on the invoice depends on the Collection Partner's location and the Client's VAT status
In EU cross-border B2B scenarios with reverse charge, the Client may need to self-account for VAT
Providing a valid VAT ID to the Collection Partner is important for correct tax treatment
Collection Partner
Issues success fee invoice to the Client with applicable VAT based on own jurisdiction and Client location
Receives referral fee invoice from Debitura for the platform's revenue share
Responsible for applying correct VAT treatment on outgoing invoices to Clients
Should maintain documentation supporting why VAT was or was not charged (e.g., Client VAT ID for reverse charge)
Debitura
Does not invoice Clients for the success fee
Invoices Collection Partners monthly for the referral fee (revenue share) after the Collection Partner has received payment
Registered in Denmark (EU)
Key reminders
VAT is added on top of the success fee, not included in it
Tax treatment depends on the Collection Partner's jurisdiction and the locations and VAT status of the parties
The success fee invoice is issued by the Collection Partner to the Client
The referral fee invoice is issued by Debitura to the Collection Partner
Always consult a qualified accountant or tax advisor for jurisdiction-specific guidance