GlossaryEN1 min readUpdated: Jun 18, 2026

place of performance rule

In cross-border trade, the question of where a service is taxable arises at the latest when an invoice is issued—the place of performance rule provides the binding answer.

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Last updated: 18 June 2026Published: 27 January 2026

Source: https://de.wikipedia.org/wiki/Leistungsort

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Definition & Explanation

In cross-border trade, the question of where a service is taxable arises at the latest when an invoice is issued—the place of performance rule provides the binding answer. It is a statutory provision that objectively establishes where a supply is deemed to occur: a delivery of goods is generally treated as taking place at the destination, a repair service at the location where the work is carried out. These rules allow no discretion; applying the wrong provision exposes a business to back-tax assessments and interest charges. Under VAT law—most notably the EU VAT Directive—place of performance rules underpin correct invoicing, periodic returns, and the handling of intra-community transactions. Not to be confused with place of performance determination (the analytical process) or proof of place of performance (the documentary evidence of the outcome).

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place of performance rule

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