What Is a Tax or VAT Number and How Do You Get One?

A Tax or VAT number identifies individuals and businesses for tax purposes. These unique identifiers are crucial for governments to administer tax laws and track financial activities. Understanding these numbers is necessary for navigating modern economies. They facilitate the collection of revenue that supports public services.

Understanding Tax Identification Numbers

A Tax Identification Number (TIN) is a unique nine-digit identifier used by tax authorities to identify individuals and entities for tax administration. Its purpose is to track tax obligations, payments, and filings. TINs are broadly categorized for individuals or businesses.

For individuals, the most common TIN in the United States is the Social Security Number (SSN), issued by the Social Security Administration. An SSN is a nine-digit number formatted as XXX-XX-XXXX, required for employment, government benefits, and filing personal income tax returns. Another individual TIN is the Individual Taxpayer Identification Number (ITIN), issued by the Internal Revenue Service (IRS) to certain non-resident and resident aliens who need to file U.S. tax returns but are ineligible for an SSN. An ITIN also follows the XXX-XX-XXXX format but always begins with a “9”.

Businesses use an Employer Identification Number (EIN), also known as a Federal Employer Identification Number (FEIN). The IRS issues this nine-digit number, formatted as XX-XXXXXXX, to identify business entities for tax purposes. Businesses need an EIN to pay federal taxes, hire employees, open business bank accounts, and file various business tax returns. Other TINs include the Adoption Taxpayer Identification Number (ATIN) for pending U.S. adoptions and the Preparer Tax Identification Number (PTIN) for paid tax preparers.

Understanding Value Added Tax Numbers

A Value Added Tax (VAT) number is a specific tax identification number used in countries with a VAT system. This identifier is assigned to businesses for the collection and remittance of VAT, a consumption tax applied to the value added at each stage of production and distribution. The VAT number tracks the tax a business pays on purchases (input VAT) and collects on sales (output VAT).

The VAT number plays a crucial role in business-to-business (B2B) transactions, especially in cross-border trade. Within regions like the European Union, a business’s VAT number identifies its tax status, affecting how VAT applies to transactions between businesses in different member states. Businesses display their VAT number on invoices to enable other VAT-registered businesses to reclaim VAT paid on purchases.

A VAT number is a type of business TIN issued to entities registered for VAT. Businesses must register for a VAT number if their taxable turnover exceeds a certain threshold within a defined period. These thresholds vary by country and business activities. Businesses engaging in cross-border trade may also need a VAT number.

Obtaining a Tax Identification Number

Obtaining a Tax Identification Number (TIN) depends on the type of number needed. For individuals, a Social Security Number (SSN) is obtained by U.S. citizens, permanent residents, and certain temporary residents through the Social Security Administration (SSA). To apply for an SSN, individuals complete Form SS-5 and submit evidence of identity, age, and U.S. citizenship or lawful alien status. Applications can be made at local Social Security offices or by mail.

For foreign individuals who require a TIN but are ineligible for an SSN, an Individual Taxpayer Identification Number (ITIN) can be obtained from the IRS. The application for an ITIN involves completing IRS Form W-7 and attaching original or certified copies that prove foreign status and identity. Form W-7 must be submitted with a federal income tax return, or an exception may apply. Applications can be mailed to the IRS, submitted through an IRS-authorized Certifying Acceptance Agent, or presented in person at designated IRS Taxpayer Assistance Centers. Processing time for an ITIN application ranges from 7 to 14 weeks.

Businesses needing an Employer Identification Number (EIN) can apply directly with the IRS. The fastest method is the online application system, which provides the EIN immediately upon completion. Online application requires the business to be physically located in the U.S. or its territories and for the responsible party to have a valid SSN or ITIN.

Businesses can also apply for an EIN by faxing Form SS-4, which yields the EIN within four business days. Mail applications for Form SS-4 take about four weeks to process. International applicants without a U.S. residence can apply by phone or mail.

Obtaining a Value Added Tax Number

The process for obtaining a Value Added Tax (VAT) number involves registering with the relevant national tax authority. Businesses register for a VAT number if their taxable sales or services exceed a predefined turnover threshold. This requirement also extends to businesses engaging in cross-border trade.

Before applying, businesses gather specific information and documentation. This includes the business’s legal name, structure, company registration details, registered business address, contact details, and bank account information. Applicants may also need to provide their national tax identification number, prior tax registrations, and projected turnover figures.

The application process involves submitting an online application through the tax authority’s portal. Some countries offer mail-in options. The tax authority reviews the information and may request additional details. Processing time for VAT registration varies from a few days to several weeks. Upon successful registration, the business receives its VAT number and instructions on submitting its first VAT return and payment.

Locating Your Existing Tax or VAT Number

Finding an existing Tax Identification Number (TIN) or VAT number involves checking official documents. For individuals, a Social Security Number (SSN) is printed on the Social Security card. If the card is unavailable, the SSN can be found on past tax returns, W-2 forms, or 1099 forms. Individuals can contact the Social Security Administration directly or access their “My Social Security” online account.

For businesses, an Employer Identification Number (EIN) is listed on the IRS confirmation letter (Notice CP 575). The EIN also appears on federal business tax returns and payroll documents. Business bank account statements, loan applications, and state or local business licenses may also contain the EIN. If the EIN cannot be located, businesses can call the IRS Business and Specialty Tax Line at 1-800-829-4933.

For Value Added Tax (VAT) numbers, businesses should check the registration documents received from the tax authority. The VAT number is also displayed on invoices issued by the business. Past VAT returns or correspondence from the tax authority are sources for finding the number. If records do not yield the VAT number, contacting the relevant national tax authority directly is the next step. Many tax authorities provide online portals or helplines for businesses to retrieve their registration details.