Yes, there is one more complexity about VAT in the EU. Even if your company hasn’t exceeded the €40,000 threshold, you might become limitedly obligated to pay VAT if:
- a company purchases goods from another VAT payer the taxable value of which exceeds €10,000 (calculated from the beginning of a calendar year)
- a company receives certain services from a foreign person who is not registered as a VAT payer in Estonia. The list of services is quite big and consists of such services as advertising, different kinds of consulting services, and some financial ones. We advise you to explore the full list here and comply with all these rules to avoid tax issues.
So if a company fits mentioned frames, it becomes obliged to register as a VAT payer with limited liabilities
. It’s not a VAT-obliged company in the usual sense — a company has to pay VAT only on the intra-Community acquisition of goods and on receiving the services from a foreign person. Note that a company must submit a special application to the Estonian Tax and Customs Board
within three days since it becomes liable.