- VAT Exemption and Compliance: Starting January 1, 2025, small enterprises with an annual turnover of up to EUR 100,000 can sell goods and services without charging VAT (VAT exemption) and will have reduced VAT compliance obligations, though they will lose the right to deduct VAT on exempt supplies.
- Eligibility and Application: Small enterprises must have a total annual turnover below EUR 100,000 across the EU to qualify, and the scheme is optional. Non-EU small enterprises, including those based in the UK, cannot participate.
- Simplified Processes: The scheme introduces a single registration and a quarterly report for VAT exemptions, along with a new maximum national annual threshold of EUR 85,000, allowing for simplified compliance across Member States, including provisions for cross-border transactions.
Source: sme-vat-rules.ec.europa.eu
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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