Value added tax and other indirect taxes

Tax advisers of Grant Thornton have extensive knowledge in the field of value added tax, excise duties and customs, both on the national and international level.

• Advice on transactions subjected to VAT and other indirect taxes
• Ascertainment of the tax rate for cross-border transactions
• Preparation of an optimum system for deducting input VAT
• Audit of VAT compliance
• Registration for VAT purposes in Estonia and abroad
• VAT accounting and reporting
• Advice on special procedures
• VAT representation and reporting (including Intrastat)
• Refunding of VAT paid in a foreign country

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VAT abroad

In addition to Estonia, many customers operate in other EU Member States and internationally. Grant Thornton has established international partner network that allows to advise customers in various cross-border and international aspects of VAT.

• We help to determine if and when the customer has the obligation to register as a VAT payer in a foreign country Despite the harmonised VAT regulation there are still various differences in practice across the EU
• Where the obligation to register as a VAT payer in a foreign country proves inevitable, we can use our partner network to provide the best solution for VAT registration and the subsequent compliance
• Additionally, we have tax and customs authorities licence nr ME 004-2004 that allows us to provide tax representation in the field of VAT services to the clients.

We advise our foreign clients on the refunds for the VAT paid in Estonia and Estonian clients on VAT refund procedures in other member states. In cases where needed we carry out necessary operations.

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Deduction of input VAT

As value added tax is a neutral tax, i.e. VAT liability must correspond to the right to deduct input VAT. This simple principle is not always straightforward in administrative practice. We ensure that companies exercise due care in input VAT deduction. Our team has been actively involved in the formation of the existing judicial practice on due care.

In addition to due diligence, attention must be paid to whether the company has tax exempt supplies or non-business income in addition to taxable revenue. This is the case for many organisations.

The partial input VAT deduction method must be applied in case of mixed revenue. Our analysis helps to determine the most profitable method for the client. When determining the best applicable method, we will often coordinate with Tax and Customs Board to find a solution which satisfies all parties involved.

We also advise customers with respect to the terms and conditions and options for deducting input VAT in areas regulated by special procedures:

• sale of real estate and metal waste;
• tourism;
• digitally provided services;
• resale of second-hand goods; auctioning of goods;
• VAT accounting in public sector.

We are licenced to serves as tax representatives for our non-EU clients. We assist clients with reclaiming VAT paid in Estonia and/or other countries and when necessary we apply for the refund on the client’s behalf.

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