SME Scheme – General features
Exemption
It is possible to opt for the SME scheme in Estonia.
Transactions excluded from the SME scheme
The following transactions are excluded from the SME scheme:
- Occasional transactions, like the supply before first occupation of a building or parts of a building or the supply of building land,
- Exempt cross-border supplies of new means of transport made from one Member State to another.
National annual threshold
Estonian national annual threshold is 40 000 EUR. In Estonia there are no sectoral thresholds.
Information on the national annual threshold is available on TEDB.
Domestic SME scheme
In Estonia the VAT rules are same for all businesses. For a company registered in Estonia an obligation to register as taxable person shall arise of the date on which the taxable supply carried out by the person exceeds 40 000 euros as of the beginning of a calendar year. Meaning that a person with supplies below this amount will not have to register or pay VAT.
Cross-border SME scheme
The cross-border SME scheme applies in the following situation(s):
- The small enterprise applies the SME scheme in other Member States than the Member State of establishment
- The small enterprise applies the SME scheme both in the Member State of establishment and in other Member State(s).
Simplified VAT obligations
The VAT registration in each Member State where the small enterprise applies the SME scheme is replaced by a single prior notification to be submitted in the Member State of establishment.
The periodical VAT returns are replaced by a single quarterly report for all Member States to be submitted in the Member State of establishment.
Currency
The values of supplies of goods and services to indicate in the prior notification, in the update to a prior notification and in the quarterly reports must be in EUR.
Way of submission
The prior notification, the update to a prior notification and the quarterly reports should be submitted by electronic means on this page.
Additional simplified VAT obligations
Exempt small enterprises applying the cross-border SME scheme in Estonia are released from the obligations to register for VAT from the date of taxable turnover (the obligation arises when the Estonian threshold 40 000 EUR is exceeded) and submitting periodical VAT returns until reaching the threshold.
Loss of simplified VAT obligations
Non-compliant small enterprises may be required:
- to VAT register
- to submit periodical VAT returns
Transitional period
Estonia does not apply any transitional period in case the national annual threshold is exceeded during the current calendar year.
The transitional period applicable can be found in TEDB database.
Quarantine
Quarantine period in case of exclusion from the SME scheme
Small enterprises excluded from the SME scheme in Estonia are not able to benefit from that exemption during a quarantine period. In Estonia the quarantine period is 1 calendar year.
You can consult the quarantine period applicable in Estonia on TEDB database.
Quarantine period in case of voluntary departure from the SME scheme
In case of voluntary departure from the SME scheme no quarantine period is imposed in Estonia (see TEDB).
Appeals
Domestic SME scheme
Appeals should be addressed to your Member State of establishment (MSEST).
Cross-border SME scheme
Member State of establishment (MSEST)
Appeals related to the following topics should be addressed to MSEST:
- Union annual turnover
- Prior notification, correction and update to a prior notification
- Quarterly reports and correction of a quarterly report
- Exclusion for exceeding the Union annual turnover
Member State of exemption (MSEXE)
Appeals related to the following topics should be addressed to MSEXE:
- National annual turnover
- Denial to access the cross-border SME scheme in MSEXE
- Loss of simplified VAT obligations in respect of MSEXE
- Exclusion for exceeding the national annual threshold/sectoral threshold in MSEXE