The European Council (EC) adopted the simplified VAT rules for small businesses. As noted in our story from 6th January 2020, the purpose of the new rules is to reduce the administrative VAT burden and compliance costs for small enterprises and create an environment which assists those SMEs to grow and trade across borders more efficiently.
Small businesses will be eligible for simplified VAT compliance rules. This is in cases where their annual turnover remains below a threshold set by a Member State concerned; which cannot be higher than €85,000.
However, under certain conditions, small businesses from other Member States which do not exceed this threshold will also be able to benefit from the simplified scheme, so long as their total annual turnover across the whole EU does not exceed €100,000. These new rules will apply as of 1 January 2025.
For further information or help on VAT related matters, contact one of our Experts.