Whether a cloud invoice charges VAT or arrives with no tax at all depends on which of the provider's companies issues it and on the tax details held on the account. The same usage can appear with or without tax depending on who bills it, a missing tax registration number can change the invoice total, and a report that mixes net and gross amounts compares months and accounts that do not compare. This page describes what the providers' invoices and tax documentation show and how the European Commission explains the mechanism in general. Which tax applies to your company is for your tax adviser to decide.

How it works

Each provider sells in Europe through its own companies. Which one bills you follows from the account's address and country, and that company, together with the tax registration number on the account, decides whether the invoice charges VAT.

The Commission sets out the general mechanism in its invoicing rules: under the reverse charge, the customer rather than the supplier is liable for the tax, and the invoice then carries the words "reverse charge" and the customer's VAT identification number. Whether the reverse charge applies to a given purchase is for your tax adviser to decide.

AWS

AWS sells to accounts in the European Union through Amazon Web Services EMEA SARL, based in Luxembourg. It has branches in 17 EU countries, Germany, France, Ireland and the Netherlands among them, which are the same legal entity and act as a local supplier for VAT. For accounts in those countries AWS documents that it charges VAT from the effective date it lists, and the customer's tax registration number (AWS calls it the TRN) is printed on the invoice so the customer can claim credit for it. In EU countries without a branch, AWS charges local VAT unless a valid TRN is on the account, and notes that a customer who is not charged VAT may have to self-assess it under local rules. AWS decides each account's location at invoicing from the TRN, billing address and contact address, and shows it as the "Tax Address".

Azure

In a set of countries that includes Germany, Austria, France, the Netherlands and the United Kingdom, a local Microsoft subsidiary sells to Microsoft Customer Agreement customers under what Microsoft calls the Limited Risk Distributor model. For customers outside that model, Microsoft names Microsoft Ireland Operations Limited as the billing entity for EMEA. The tax type and amount follow the country of the billing profile, and Microsoft notes that a customer who does not have to pay tax sees no tax on the invoice.

Google Cloud

Google names Google Cloud EMEA Limited in Ireland as the contracting entity for customers with a billing address in EMEA, with separate local companies for France, Italy and Poland. For EU customers outside France and Ireland, the tax depends on the account type: on a Business account Google does not add VAT and the customer determines the tax due at their country's rate, while on an Individual Entrepreneur account Google charges local VAT. The account type cannot be changed once the Cloud Billing account exists.

The United Kingdom

Since Brexit the United Kingdom has its own rules. HMRC describes the reverse charge for services a UK business receives from a supplier that belongs outside the UK in general terms: the customer acts as both the supplier and the recipient, and this holds even when the supplier has a UK VAT registration number. AWS bills UK accounts through the UK branch of AWS EMEA SARL, Microsoft through a UK company under the Limited Risk Distributor model, and Google states that usage by customers in the United Kingdom is subject to 20% VAT. How that applies to a given company is for its tax adviser to decide.

What it means for your cost

In the billing data, tax is a line of its own. In the AWS CUR it has the type Tax in line_item_line_item_type, the kind of tax sits in line_item_tax_type, and line_item_legal_entity names the seller, which for third-party AWS Marketplace purchases can be someone other than AWS. In the Google Cloud standard usage export to BigQuery, tax has the cost_type tax and is shown per project, with the project columns empty where the tax is not tied to one. On a Microsoft invoice the subtotal is the pre-tax amount and tax is added after Azure credits: total equals charges minus Azure credit plus tax.

Three things follow for any cost report:

  • Net against gross. Cost reports usually show usage without tax, because tax belongs to the invoice and its issuer rather than to the service. Count it in, and an account's cost rises whenever only its tax treatment changes. Whether VAT is a cost for your company is for your tax adviser; the report only has to state which basis it uses.
  • Invoice currency. AWS bills in US dollars by default, the billing currency can be changed, and line_item_currency_code gives the currency of each line. Google gives the billing currency per row in currency. Tax is stated in the invoice currency, and converting it into euro or pounds is part of the report's exchange-rate policy.
  • The tax number changes the total. In EU countries without an AWS branch, a valid TRN decides whether AWS charges local VAT. Without one, a tax line appears and the invoice total rises with no change in usage.

Where it goes wrong

  • No tax registration number on the account. One account shows VAT and a comparable one does not. The cause: AWS uses the TRN to tell business from non-business customers, and an account without one is treated differently.
  • Member accounts with their own settings. At AWS, member accounts take the payer account's Tax Address and TRN only when the payer turns on tax settings inheritance; by default each account is assessed on its own. An organisation with many accounts can therefore see different tax treatment on lines that belong to one company.
  • Tax and usage in one report. A report that does not filter out the CUR's Tax lines or the tax rows of the Google export shows cost that is not usage. Google's tax rows carry a project, so they land in team reports.
  • Marketplace sellers. In AWS Marketplace the seller can be a company other than AWS, as line_item_legal_entity shows, with its own invoice and its own tax treatment. A sum across all lines then mixes several issuers.
  • Credits before or after tax. Microsoft deducts Azure credits before tax. A report that applies credits after tax arrives at amounts that match no invoice. How credits are treated for tax is for your tax adviser to decide.

Sources

Read on 2026-10-15. AWS Tax help: European Union, AWS CUR 2.0 line item columns, AWS Setting up your tax information, Microsoft Understand your Microsoft Customer Agreement invoice, Google Google contracting entity, Google Taxes in your country, Google Structure of Standard data export, European Commission VAT invoicing, HMRC VAT Notice 741A: place of supply of services.