Estonia introduced Value Added Tax in 1992. The rules on Estonian VAT registrations, returns and compliance are based on European Union EU VAT Directives which Estonian transposed into its VAT Act after its accession to the EU in 2004. The tax is administered by Estonian Tax and Customs Board.
Foreign companies, or ‘non-resident’ traders, providing goods or services in Estonia to local businesses or consumers may have to register their business for Estonian VAT. They will then have to follow the Estonian VAT compliance rules, including invoicing and VAT rates, as well as pay over any Estonian VAT due.
There are a number of trading situations which typically require a foreign trader to register with the Estonian tax authorities. These follow the broad EU VAT rules, and include:
Few companies need to VAT register if they are providing services to local Estonian companies, and instead can use the Reverse Charge process. This is based on the 2010 VAT Package changes.
Note that providers of electronic, broadcast or telecoms services to consumers in Estonia only have to VAT register in one EU country under the MOSS scheme to file a single return covering all 27 member states.
If you do need to VAT register, read our Estonian VAT registration briefing to understand the requirements, including the VAT registration thresholds. You can also read about Estonian VAT returns.
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