Law on Value Added Tax of the Republic of Lithuania
What the law regulates
The Law on Value Added Tax (No. IX-751) implements the EU VAT Directive in Lithuania. It defines which supplies of goods and services are subject to VAT, the place of supply, the VAT rates and exemptions, the registration of VAT payers, VAT invoices, the deduction of input VAT and VAT returns.
Who it applies to
Companies and individuals carrying out economic activities in Lithuania, and foreign businesses supplying goods or services taxable in Lithuania.
Key points for company owners
- Rates. The standard VAT rate is 21%; reduced rates of 9% and 5% apply to certain goods and services, and some supplies are exempt or taxed at 0% (for example, exports).
- Mandatory registration. A company must register as a VAT payer when its income from supplies in Lithuania over the last 12 months exceeds €45,000, and in some other cases — for example when acquiring goods from other EU countries above the set threshold or receiving services from foreign suppliers.
- Voluntary registration. A company can register earlier, for example to deduct input VAT from the start of its activities.
- Non-residents. Foreign businesses supplying goods or services taxable in Lithuania may have to register for VAT in Lithuania even without a Lithuanian company.
- Returns. VAT payers submit periodic VAT returns and records of invoices to the VMI electronically.
Official text: Law on Value Added Tax, No. IX-751 (English translation) (Register of Legal Acts of the Seimas, e-seimas.lrs.lt). English translations there may not include the latest amendments — the Lithuanian version prevails.
This overview explains the law in plain English for business owners. It is not legal advice and does not replace the official text; laws change, so always check the current version. For advice on your situation, contact us.