Lithuania introduced Value Added Tax in 1994. Lithuania joined the EU in 2004 and as an EU member state its rules on Lithuanian VAT registrations, returns and compliance are based on European Union EU VAT Directives. The tax is administered by the State Tax Inspectorate (STI) under the authority of the Republic of Lithuanian Ministry of Finance.
Foreign companies, or ‘non-resident’ traders, providing goods or services in Lithuania to local businesses or consumers may have to register their business for Lithuanian VAT. They will then have to follow the Lithuanian VAT compliance rules, including invoicing and VAT rates, as well as pay over any Lithuanian VAT due.
Should you register for Lithuanian VAT
There are a number of trading situations which typically require a foreign trader to register with the Lithuanian tax authorities. These follow the broad EU VAT rules, and include:
- Importing goods into Lithuania from another country from outside the EU
- Moving goods between Lithuania and other EU member states (intra-community supplies), either as sales (dispatches) or purchases (arrivals)
- Buying and selling goods in Lithuania
- Selling goods over the internet to Lithuanian consumers, subject to the Lithuanian distance selling VAT registration threshold
- Goods held in consignment stock
- Holding live exhibitions, events or training in Lithuania
- If a company is otherwise a non-VAT trader, but is receiving services in Lithuania under the reverse charge rule
- The self-supply of goods
Few companies need to VAT register if they are providing services to local Lithuanian companies, and instead can use the Reverse Charge process. This is based on the 2010 VAT Package changes.
Note that providers of electronic, broadcast or telecoms services to consumers in Lithuania only have to VAT register in one EU country under the MOSS scheme to file a single return covering all 27 member states.
If you do need to VAT register, read our Lithuanian VAT registration briefing to understand the requirements, including the VAT registration thresholds. You can read more about Lithuanian VAT returns too.
There may be further exemptions from the requirement to VAT register in Lithuania you should consider. Please read our Lithuanian VAT Reverse Charge briefing.
Need help with your Lithuanian VAT compliance?
Researching Lithuanian VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.
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