It is proposed to update the VAT treatment: the amendments are relevant for small businesses

Today, the Government approved the draft Law prepared by the Ministry of Finance, which proposes to transpose the new provisions of the European Union (EU) legislation adopted in the field of value added tax (VAT) that are relevant to Lithuanian small businesses.

“These amendments, which are in line with the EU Directive, are aimed at reducing the administrative burden on small businesses at cross-border level and helping to create a more growth-friendly tax environment, as well as increasing the competitiveness of small businesses in Lithuania and other EU Member States in the single market,” Vice-Minister of Finance Kristupas Vaitiekūnas states.

The draft Law provides for the possibility for small businesses from other EU Member States not to register for VAT in Lithuania, provided that the business does not exceed the VAT registration threshold set in Lithuania, which amounts to EUR 45, 000, and the annual turnover of EUR 100, 000 in the EU.

Accordingly, Lithuanian small businesses will also have the possibility not to register for VAT in another EU Member State, provided that they do not exceed the VAT registration threshold set in that EU Member State and the annual turnover in the EU (EUR 100, 000).

Last updated: 12-02-2025

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