VAT rates in EU members states and how do they compare to Slovenia?
When doing business in Europe it also usually means trading with other EU member states. If you set up a company in Slovenia and also do business in Europe as well, you will have to be aware of the different VAT rates in EU. So, do you know what is VAT? It is value added tax which you use on selling good but also services. In most states they usually also have two rates, sometimes even three. Slovenia is also no different. The standard VAT rates in Slovenia is 22% but in other EU member states it lies between 17% (Luxembourg) and 27% (Hungary). Some countries also have transitional rates due to the pandemic. However, they will mostly end by the end of this year. This articles will also include the information on the VAT in Slovenia and the countries surrounding Slovenia.
Remote trading and VAT
From July 1st of the year 2021 onward there are changes for companies that also sell goods remotely. Companies where the sales to natural persons surpass 10.000€ have to also charge the VAT rates in EU according to the country of the recepient. So, it is important to choose the correct VAT rate in EU. You also need to choose the correct rate for the type of goods.
Comparing VAT rates with countries around Slovenia
As you can see in the table below, Slovenia is in a favorable position when it comes to VAT rates in the EU. Austria has a lower standard VAT rate but their lowered rate is higher than our. Currently they have a lower rate for accommodation and hospitality business (5% instead of 10%). Croatia has a higher standard rate, but their lowered rate is lower than ours. The lowered rate affected the business conduct of those companies that provide goods and services of basic commodities and also for hospitality business. The lowered VAT rate (13%) is also valid for electricity costs. Additionally, we post all additional updates on taxation in Slovenia on our Facebook and Instagram.
Each country also accepts the lowered VAT rates locally. But there are certain guidelines from the EU. Because of that, there are certain differences in which goods have the standard and which the lowered VAT rates in EU.
The list of VAT rates in the EU of the countries around Slovenia
This articles also includes the information on VAT rates in different countries around Slovenia.
Countries around Slovenia
|Member state||Country code||Standard VAT rate||Lowered VAT rate||Additionally lowered VAT rate||Transitional VAT|
|VAT rates in EU: Hungary||HU||27||5/18||/||/|
VAT rates in the EU: obligatory identification for VAT purposes
The legal limit where you also have to identify for VAT purposes is 50.000€. Until this limit, smaller taxpayers do not have to enter the VAT system. Also, they do not have the right to refund or deduction of VAT that they pay when buying goods or services.
However, in other countries the limits are different. We also present them in the table below for the countries around Slovenia.
|Member state||Country code||Limit for small taxpayers|
|Austria||AT||35 000 EUR|
|Croatia||HR||300 000 HRK (25.565 EUR)|
|Hungary||HU||12 000 000 HUF (33.977 EUR)|
|Italy||IT||65 000 EUR|
|Slovenia||SI||50 000 EUR|
If you are interested in understanding more about VAT rates in EU and Slovenia, you can also contact our tax experts.