VAT and US sales-tax thresholds for digital game sales

Thresholds decide when a tax obligation switches on. For digital game sales the rules are easy to get wrong because they hinge on where your business is established, not just where your customers are. A studio inside the EU faces very different timing from one outside it, and US states each set their own bar.

This guide explains, in general terms, the main thresholds for VAT in the EU and sales tax in the US so you know roughly when registration becomes a question worth asking. These rules change and figures are revisited often, so treat this as a snapshot and confirm the current position with a qualified adviser.

Non-EU sellers: VAT from the first sale

If your studio is established outside the EU and you sell digital goods to EU consumers, VAT registration is generally required from the first sale. There is no minimum threshold to shelter under — selling a single download to an EU customer can be enough to create an obligation.

This catches a lot of small studios by surprise. The practical route is usually to register for the non-Union One Stop Shop scheme, which lets you report EU VAT through a single registration rather than country by country.

EU-established sellers: the €10,000 threshold

Sellers established within the EU are treated differently. There is a single pan-EU threshold of €10,000 for cross-border B2C supplies. Below it, you can generally charge your home country's VAT; above it, you charge the destination country's VAT and typically report through the Union One Stop Shop.

The key point is that this €10,000 threshold belongs to EU-domiciled sellers only. If you are outside the EU, it does not apply to you — do not confuse the two cases, because the timing of your first obligation is completely different.

US sales tax: economic nexus by state

The US has no national VAT. Instead, individual states impose sales tax and use economic-nexus thresholds — usually a dollar value of sales into the state over a rolling period — before a remote seller has to register and collect. Cross that bar and the duty triggers.

Thresholds vary by state. Texas, for example, uses a threshold of around 500,000 US dollars of gross sales over a rolling 12-month period, with no separate transaction count. Other states set different figures and some add a transaction-number test, so you have to look state by state.

Why these numbers keep moving

None of these figures should be treated as permanent. The EU's VAT rules are being reformed in stages through the rest of the decade, US states periodically adjust or remove thresholds, and rates change. A threshold that was right when you launched may not be right at your next release.

Build a habit of rechecking the markets you actually sell into, and lean on an adviser to confirm registrations before you assume you are either over or under a limit.

How Altery fits

Altery does not determine your thresholds or register you anywhere — those depend on your facts and your adviser's read of the rules. What Altery offers is indirect support once obligations exist. Selling across the EU and US means receiving EUR, GBP and USD, and multi-currency accounts let you hold each currency and convert on your own timeline rather than at whatever rate a platform applies.

As you approach a threshold, dedicated pots let you ring-fence the VAT or sales tax you will owe, and real-time balances keep that money visible. If you sell through several entities, per-entity reconciliation keeps each one's sales totals clean, which matters when a threshold is measured per registration. Altery is not a bank and provides general information, not tax or financial advice.

Frequently asked questions