VAT GUIDE IN LITHUANIA
LITHUANIAN VAT GUIDE FOR BUSINESSES
VAT (PVM – Pridėtinės vertės mokestis) is a consumption-based tax applied to goods and services in Lithuania. It is administered by the State Tax Inspectorate under the Ministry of Finance.
VAT is charged at each stage of the supply chain, from production to the final consumer, with businesses collecting and remitting the tax to the government.
Lithuania’s VAT system operates in accordance with the European Union VAT Directive, ensuring harmonization with other EU Member States. Key aspects of the regime include rules for VAT registration, invoicing, filing obligations, refund procedures, and penalties for non-compliance.
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VAT Rates
Who Needs to Register for VAT?
VAT applies to taxable persons (businesses or individuals) conducting economic activity in Lithuania, as well as certain legal entities for intra-Community acquisitions.
Domestic registration threshold: EUR 45,000 turnover in the past 12 months (applies to combined turnover of related entities, unless management and activities are clearly separate).
Special threshold: EUR 14,000 for farmers under a special scheme, nontaxable legal persons, and taxable persons not entitled to input VAT deduction (for intra-EU acquisitions).
Non-established businesses: Must register if making taxable supplies in Lithuania (no threshold), unless the reverse charge applies or supplies are exempt/out of scope.
Distance sales to Lithuania (B2C): Registration required if annual sales exceed EUR 10,000, unless covered under an EU special scheme (e.g., OSS/IOSS).
Tax representatives: Foreign businesses must register via a Lithuanian establishment or appoint a fiscal representative.
VAT Obligations
VAT Invoices
A Lithuanian taxable person is generally required to issue a VAT invoice for all taxable supplies and exports. This invoice is essential for substantiating an input tax deduction claim.
Simplified VAT invoices are allowed in Lithuania for supplies not exceeding EUR100 (including VAT), except for distance sales, intra-EU 0% VAT goods, new vehicle supplies to another EU state, or certain cross-border services under the reverse charge. They may also be issued regardless of value for private use, self-manufactured assets, or specific cases under Article 9 of the VAT Law.
Records
In Lithuania, a taxable persons must keep VAT records (e.g., registers of issued/received invoices, transport documents for zero-rated supplies) that allow accurate VAT obligation determination. Records can be held in or outside Lithuania, but non-established businesses may store them abroad if accessible to tax authorities. Established businesses must keep paper records in Lithuania but may store electronic ones abroad with proper notification and access. VAT records must be retained for 10 years, including e-commerce transaction data for supplies to EU consumers, which must remain electronically accessible to relevant tax authorities.
Lithuania allows electronic archiving of invoices, regardless of their original format. Businesses must preserve authenticity, integrity, and legibility throughout the retention period.
VAT Deadlines
Periodic VAT Returns
In Lithuania, taxable persons are generally required to submit VAT returns on a monthly basis. However:
- If a Lithuanian taxable person supplies goods and/or services under the EU or non-EU OSS scheme and settles VAT through OSS, they must typically file VAT returns quarterly.
- A legal entity whose taxable supplies did not exceed EUR 300,000 in the previous calendar year may opt for quarterly filing.
- Individuals usually file VAT returns semiannually but may request a different filing frequency.
- Members of international corporate groups may apply for a different VAT filing period if the group uses accounting periods other than calendar months. The maximum allowed period is 60 days, and both the first and last periods must align with the calendar year (starting on 1 January and ending on 31 December).
- Taxable persons acquiring goods from other EU Member States or receiving services subject to the reverse charge under Article 95(2) of the Lithuanian VAT Law must file monthly VAT returns; no alternative filing period is permitted in these cases.
As a rule, monthly VAT returns must be submitted by the 25th day of the month following the end of the tax period, unless other deadlines are specified.
Periodic VAT Payments
VAT due must be paid in full by the same deadline as the VAT return—generally, by the 25th day of the month following the tax period. Payments must be made in euros via bank transfer to the tax authority’s bank accounts. The transfer must include the taxable person’s VAT number and payment code 1001.
VAT Refund
Businesses not established or registered for VAT in Lithuania can recover Lithuanian VAT to the same extent as VAT‑registered entities.
EU Businesses: Refunds follow EU Directive 2008/9/EC rules. Applications are submitted via the home country’s electronic VAT refund system. No taxable supplies in Lithuania during the claim period (except reverse‑charge transactions) are allowed.
Non‑EU Businesses: Refunds follow the EU 13th Directive and are granted on a reciprocity basis (e.g., Armenia, Iceland, Norway, Canada, Switzerland, UK, Türkiye). OECD countries without VAT may also qualify (currently only the USA).
Conditions for VAT refund: No Lithuanian business establishment or permanent residency. And no taxable supplies in Lithuania, except for international transport, reverse‑charge transactions, or special schemes (non‑EU, EU, IOSS).
Application Rules:
- Deadline: 30 June following the claim year.
- Claim period: 3–12 months (can be shorter if it covers year‑end).
- Submission: Via Mano VMI, post, or in person to Vilnius County State Tax Inspectorate.
- Applications via representatives require a notarized and translated power of attorney (apostilled/legalized if issued outside the EU).
- Must include details of purchases with goods/services codes per EU and Lithuanian regulations.
Penalties for non-compliance
Late Registration:
Generally, no automatic penalties or interest.
Possible fine: EUR 390–1,100 under the Code of Administrative Offenses.
Must still calculate and pay VAT—failure may lead to penalties, interest, and “unreliable taxable person” status (publicly disclosed, extended audits, loss of public procurement rights, loss of beneficiary status).
Late Payment & Filing:
Penalty: 20%–100% of unpaid VAT (doubled for repeat violations within the limitation period).
Voluntary disclosure avoids penalties but interest still applies.
Interest rates: 0.029% daily (May–Oct 2024), 0.027% daily from Nov 2024.
Late or missing returns: warning or EUR 200–390 fine.
Errors:
If underpayment occurs → same penalties and interest as late payment; EUR 200–390 fine possible.
If no underpayment → administrative fine EUR 200–390 may still apply.
Voluntary amended returns avoid penalties but incur interest.
Unreliable Taxable Person Status:
Triggered if fines and tax assessments exceed EUR 15,000 for certain violations, or fines of at least EUR 1,500 for specific offenses, or repeated violations.
May also result from serious offenses (fraud, illegal work, financial crimes) or SAF‑T noncompliance.
Fraud:
Administrative fines up to EUR 6,000.
Criminal penalties may include community service, fines, or up to 8 years’ imprisonment.
Entities and responsible persons can be held liable; offenders deemed unreliable.
Common VAT Terms
- PVM – Value Added Tax (VAT)
- PVM sąskaita faktūra – VAT Invoice
- PVM mokėtojas – VAT Payer / Taxable Person
- PVM deklaracija – VAT Return
- PVM tarifas – VAT Rate
- PVM kodas – VAT Code / VAT Number
- Apmokestinamas asmuo – Taxable Person
- Apmokestinamoji vertė – Taxable Amount
- Apmokestinamosios pajamos – Taxable Revenue
- Atvirkštinis apmokestinimas – Reverse Charge
- PVM grąžinimas – VAT Refund
- PVM prievolė – VAT Liability
- PVM registracija – VAT Registration
- PVM mokėjimas – VAT Payment
- PVM apskaičiavimas – VAT Calculation
- PVM neapmokestinama – VAT Exempt
- Intrastato ataskaita – Intrastat Report
- ES prekių tiekimas – Intra‑EU Supply of Goods
- ES paslaugų teikimas – Intra‑EU Supply of Services
- PVM schema – VAT Scheme
