Standard VAT rate
The term “taxable supplies” refers to supplies of goods and services that are liable to a rate of VAT.
The standard rate of VAT applies to all supplies of goods or services unless a specific measure provides a reduced rate, the zero rate or an exemption.
The VAT rates are as follows:
For digital services, telecommunication services or broadcasting services supplied B2B (business-to-business), the place of supply is the place where the recipient is established. No Lithuanian VAT should be charged and the reverse charge may apply unless a supplier and a customer are both established in Lithuania.
For digital services, telecommunication services or broadcasting services, supplied to final consumers (B2C) context, effective 1 January 2015 until 31 December 2018, Lithuanian VAT was due for supplies to customers that are permanent residents in Lithuania irrespective of where the supplier is established. Starting from 1 January 2019, different rules apply for nonresident and resident service providers.
Until 31 December 2018, a nonresident supplier that supplies B2C digital services was required to register for and charge Lithuanian VAT on these supplies. However, effective 1 January 2019, the digital services, telecommunication services or broadcasting services shall not be deemed to be provided in the territory of the country (i.e., no Lithuanian VAT shall be charged), when all the following conditions are met:
On 1 July 2021 EU has introduced a so-called “One-Stop-Shop” (OSS) system which has replaced a previously applied “MiniOneStopShop” (MOSS) system. OSS has extended the scope of MOSS from digital goods and services to all goods and services sold B2C in the EU. OSS is an electronic portal that simplifies VAT compliance for online sellers, i.e., online businesses that sell goods and/or services in the EU are now only required to register for VAT in one EU country for all their B2C sales in the EU. If such sellers’ B2C sales in EU are above the applicable threshold, which is 10.000,00 EUR throughout the EU, businesses are liable to charge, collect and remit VAT in the Member State where their B2C buyers are located, instead of the Member State or country of their incorporation, i.e. online sellers have to apply the VAT rate of the Member State where the goods are dispatched or where the services are supplied. AS each EU Member State has an online portal where businesses can register for OSS and submit their VAT returns in one Member State for their B2C sales throughout the EU, it is estimated that VAT compliance costs will be significantly reduced. Registration in the OSS system is available for both – taxable persons established in the EU and outside the EU.
The obligation for VAT registration in Italy might be triggered in different ways. Here is the the list of most common scenarios:
Non-EU business which are selling in Lithuania will have to appoint a fiscal representative for the VAT registration and compliance in Lithuania.
Fiscal representative is jointly liable for the VAT compliance duties for non-EU companies.
Need a Fiscal Representative Service in Lithuania? 1StopVAT can provide it together with other Global VAT/GST/Sales tax compliance services.