Payments guide

What VAT-included pricing means

The price you see is the price you pay. Here is what VAT is, why prices in the UK and the EU already include it, and how it works for gift cards.

Written by the Niceway Help teamUpdated 2 min read
On this page
  1. What VAT is
  2. Why the price already includes it
  3. Which rate applies
  4. Gift cards and vouchers
  5. Currencies and VAT

What VAT is

Value added tax (VAT) is a tax on most goods and services sold in the UK and the EU. The seller collects it as part of the price and pays it to the tax authority.

Why the price already includes it

In the UK and the EU, prices shown to consumers must include VAT and any other taxes, so the price on the page is the price you pay. Some shops for businesses show prices before VAT; prices for consumers never do.

On Niceway, the prices on every page and in the summary before you pay include VAT where it applies. VAT is never added on top at checkout.

Which rate applies

Rates differ by country. The standard rate in the UK is 20%. Standard rates in EU countries range from 17% in Luxembourg to 27% in Hungary.

For telecom and other digital services sold to consumers, VAT is normally charged at the rate of the country where the customer lives.

How Niceway applies VAT: eSIM plans and game top-ups include VAT at the rate of the country where you live. Gift cards follow the voucher rules below. Virtual card issue prices and top-up fees are charges for payment services, which are exempt from VAT, so no VAT is added to them.

Gift cards and vouchers

VAT on gift cards follows special rules for vouchers, in both the UK and the EU:

  • Single-purpose vouchers can only be spent on one kind of goods or services taxed in one known country. VAT is charged when the voucher is sold.
  • Multi-purpose vouchers can be spent on things taxed differently, such as store credit for many kinds of products. VAT is charged when the voucher is spent, not when it is sold.

Which type a card is depends on the store and the region. That is why our order summaries say “Included where it applies”. For you the price is the same either way: any VAT is already inside the face value, and we add none on top.

Either way, a gift card costs its face value: a €20 card costs €20.00.

Currencies and VAT

Switching between euros, pounds and US dollars changes the price shown, not the VAT treatment. Each currency has its own set price. More in Payment methods and currencies.