Estonia - Planned VAT changes due in 2027

 Posted by: Monika Misiura

  20 January 2025

The Ministry of Finance has sent a draft development plan to amend VAT Act that covers:

- Incorporation of EC Sales List with VAT return
Intra-community supply list (EC Sales list that is currently submitted on a form VD) is planned to be incorporated into the VAT return. If approved, all data will need to be filled on the VAT return starting from 1 January 2027.

- Inclusion of additional invoice data in the VAT return
It is planned that data on all sales and purchase invoices (except exempt and zero-rated supplies), regardless of the taxable value is submitted to the VAT Authority along with the VAT return (annex). This would enable more accurate reconciliation of the data declared in the VAT return by the parties involved.

Currently VAT payers are required to submit additional data on invoices in the VAT return only if the taxable value is at least EUR 1,000 per invoice or at least EUR 1,000 in total for relevant tax period per trading partner.

- Mandatory adoption of electronic invoices for business-to-business (B2B) transactions.

The Estonian Ministry of Finance is working on a transformative plan to modernize VAT compliance by mandating e-Invoicing for businesses. This initiative is to be implemented in two phases:
1. Taxpayers will be able to request e-invoice from the supplier on a voluntary basis from 1 July 2025,
2. Mandatory e-invoicing for all transactions between VAT registered businesses (B2B) from 2027.

The draft law on the above changes is planned to be prepared in quarter 1 of 2025 with the changes becoming effective from 2027.

Article Categories