It is proposed to refine the procedure for calculating total consideration established in the Law on Value Added Tax
Today, the Government approved a proposal by the Ministry of Finance to refine the procedure for calculating an individual's total consideration for the purpose of determining whether the mandatory VAT registration threshold has been exceeded. The aim is to make the procedure clearer and ensure it more accurately reflects EU VAT rules and the case law of the Court of Justice of the European Union (CJEU).
The proposed amendments to the Law on Value Added Tax (VAT) would clarify which income is excluded from the total consideration received when determining whether the threshold triggering the obligation to register as a VAT payer has been reached within a calendar year.
When calculating the total consideration received, in addition to other amounts specified in the VAT Law, the consideration for the supply and/or lease of immovable property by nature, as well as for the provision of certain financial services and insurance and reinsurance services, would be excluded if such transactions are incidental and the person does not normally engage in such activities.
If the Seimas adopts the amendments, the revised procedure for calculating the total consideration received would enter into force on 1 January 2027.