Slovakia – New Rules Concerning VAT Registration Thresholds

The EU legislative framework concerning special schemes for SMEs was significantly revised upon adopting the new regulations. The Slovakian authorities have prepared necessary amendments to the related VAT framework to address these novelties. 

These novelties cover important changes in VAT registration proceedings for domestic and foreign taxable persons. The scope of these amendments is comprehensive, addressing changes related to registration thresholds, the timeline for submission of relevant documentation for becoming a VAT payer, and other inseparable compliance responsibilities of taxable persons. 

Timeline 

These changes to the Slovak VAT Act should be followed starting January 1, 2025. 

New Regulatory Framework 

Domestic Taxable Persons 

From January 1, 2025, the circumstances under which domestic taxable persons should follow the VAT registration procedure will differ from today. One of the significant changes is that the calculation of the turnover that triggers the mandatory registration is revised. The domestic taxable persons should register for VAT: 

• If their annual turnover, excluding tax, in the previous calendar year has surpassed the threshold of EUR 50,000 or;
• If their current turnover is above the threshold of EUR 62,500.

The turnover calculation period has been modified. Currently, the threshold registration is based on 12 consecutive months. However, this will change in the manner described previously. 

If Company X’s annual turnover in the preceding year was above EUR 50,000 but below the threshold of EUR 62,500, it could continue operating without imposing VAT on its supplies until January 1 of the following year. 

However, in these circumstances, Company X should apply for a VAT number following the current year’s deadline. The obligation to levy VAT will start from January 1 of next year. 

On the other hand, if the company has surpassed the threshold of EUR 62,500, it should expeditiously apply for VAT registration. In that case, Company X should impose VAT for all its taxable supplies during the present calendar year without possibly postponing it to the following calendar year. 

The taxable person who surpasses any of the above conditions should submit a VAT registration application within five working days from the date of reaching the fixed turnover threshold. 

The obligation to impose VAT on the taxable supply becomes mandatory:

• From the first day of the new calendar year, when the reason for VAT registration derives from the fact of reaching the threshold of EUR 50,000 in the previous year or;
• From the first taxable supply when the reasoning for VAT registration derives from the factual situation when the taxable person has surpassed the threshold of EUR 62,500 in the current year.

Foreign Taxable Persons 

The situation doesn’t change much regarding the turnover calculation for the registration threshold for non-established taxable persons. Practically speaking, there isn’t any registration threshold that foreign taxable persons could leverage when making taxable supplies of goods and services to customers based in Slovakia. 

A foreign taxable person should promptly submit the VAT registration application for taxable supplies in the country. 

One significant novelty should be highlighted starting from January 1, 2025. The non-established taxable person should submit a VAT registration application within five working days from the date of making a taxable supply. 

At present, the foreign taxable person should submit the VAT registration before making a first taxable supply.

Important amendments to the VAT Act of the Slovak Republic. Domestic and foreign taxable persons should be aware that a new legal framework will come into force next year, introducing important changes to the VAT registration procedure. 

The scope of changes is extensive. It covers changes in the threshold calculation, the rules for when the threshold could be leveraged, the effectivity of the received VAT ID, and the deadlines for submitting the mandatory documentation for the registration proceedings. 

Interested stakeholders should familiarize themselves with the novelties as soon as possible to avoid the risk of non-compliance when the new provisions become effective.