VAT relief for small businesses

If you are registered for VAT and your turnover for the accounting period is less than €30,000, you can still request the VAT relief for small businesses for 2024.

Submit the information concerning the relief on the VAT return for the final tax period of 2024. If your company’s tax period is the month and your accounting period is not the calendar year, you are entitled to the relief for the part of the accounting period that precedes the date when the new legislation entered into force.

If the company’s accounting period is not the calendar year, the company must allocate its sales to the calendar year or to calendar months in 2024 in the same way as they are allocated in the company’s accounting. The allocation may be based on the date when the services were conducted, the date of the invoice or the date of the payment.

What is the VAT relief for small businesses?

The VAT relief for small businesses is a form of tax credit for entrepreneurs and companies who are registered for VAT and whose turnover for the accounting period (12 months) is less than €30,000.

If the company’s net sales are

• €15,000 or less, the company will be refunded the entire amount of the VAT qualifying for the relief.
• over €15,000 but less than €30,000, the company will receive a partial VAT relief. 

Starting 2021, you are entitled to full VAT relief if your net sales are at most €15,000. Previously, the threshold was €10,000.

What information is required for requesting the relief?

To request VAT relief, fill in the information on the VAT return form:

• net sales qualifying for the relief
• amount of VAT qualifying for the relief.

The amounts of net sales and VAT that qualify are not automatically the same as the company’s net sales and VAT recorded in its accounting, because not all sales and taxes can be taken into account in the relief.

Use the VAT relief calculator for the required figures. The calculator takes into account that some of your sales and VAT do not qualify for the relief. The calculation result gives you the information you need for requesting the relief.

• Calculator when the accounting period started in 2021 or later
• Calculator when the accounting period started in 2020 or earlier

When to request VAT relief

Report the information relating to your request for VAT relief on your VAT return. Your tax period for VAT determines when you should make the request. You can request the relief either on the final VAT return for the calendar year or for the accounting period.

How does the relief affect the amount of tax?

When you submit VAT and relief details in MyTax, the e-service automatically deducts the relief amount from the amount of VAT payable for the tax period.

If the relief amount is greater than your VAT payable for the tax period, you will receive the rest as a refund. If you have no VAT payable for the tax period, you will receive the entire relief amount as a refund.

Remember to file the relief as income on your tax return

The income you receive from a VAT relief is taxable in income taxation. This income must be recorded in the company’s accounting as income received in the accounting period that qualifies for the relief.

However, if your company uses cash-based accounting, you must record the relief as income received in the year when the Tax Administration actually pays the relief to your company. If a company that uses cash-based accounting deducts the relief from the amount of upcoming tax payable for the tax period, the relief is considered to be income received in the tax year when the VAT filed on the VAT return in question would have fallen due.

Report the relief in the year’s income tax return in the section for grants and subsidies received.

The VAT relief is considered to be received from the same income source as the income for which the relief was granted. For example, VAT relief for a business operation is considered income from a business source and VAT relief for agriculture is income from agriculture.

Frequently asked questions