Taxation of goods

Here we give an overview of the place of supply of goods and the taxation of domestic transactions and acts, export and import of goods, and intra-Community supply and acquisition. Under the VAT Act, there are also a number of differences in the taxation of supply of goods, e.g. the supply of goods to be installed or assembled, new means of transport, etc. are taxed differently from the supply of other goods.

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Acquisition of a new means of transport

ACQUISITION OF A NEW MEANS OF TRANSPORT BY A PERSON REGISTERED AS LIABLE TO VAT

Intra-Community acquisition of goods means, inter alia, the acquisition of a new means of transport from a person of another Member State together with its transport from another Member State to Estonia (subsection 1 of § 8 of the VAT Act).

Persons liable to VAT, including persons with limited liability, upon intra-Community acquisition of a new means of transport from another Member State, make the corresponding VAT calculation on the VAT return form KMD in accordance with the rules of the intra-Community acquisition of goods.

VAT on the intra-Community acquisition of goods (including a new means of transport) is calculated by the recipient who must fill in fields 1 (taxable supply), 4 (VAT) and 6 and 6.1 (informative fields concerning the intra-Community acquisition of goods) in a VAT return. At the same time, a taxable person can also deduct the VAT calculated on the acquisition of a new means of transport in the same VAT return as input VAT pursuant to § 29 of the VAT Act by declaring it in field 5, unless the new means of transport is acquired by a person with limited liability or the taxable person does not have the right to deduct input VAT in full.

ACQUISITION OF A NEW MEANS OF TRANSPORT BY A PERSON NOT REGISTERED AS LIABLE TO VAT

If the acquirer of a new means of transport is a person who is not registered as a person liable to VAT, the person must submit to the tax authority the documents certifying the acquisition of the means of transport and pay VAT within ten calendar days as of the date on which the means of transport is delivered to Estonia, but not later than the date of registration of the means of transport (subsection 4 of § 38 of the VAT Act). In order to submit information on the intra-Community acquisition of a new means of transport, the person must use a customs declaration form, submit the purchase invoice and, at the request of the tax authority, the contract of sale (Regulation No 38 of the Minister of Finance of 30 March 2004).

The following fields must be filled in on the customs declaration form: consignor, name of the goods, consignee, country of departure, cost of the goods, currency, description of the goods, as well as the rate and amount of duty. VAT may be paid either in cash or by bank transfer. After payment of the tax, the label “Goods released” will be added to the customs declaration form.

Under clause 3 of subsection 6 of § 3 of the VAT Act, the persons provided for in subsections 1 and 2 of § 39 of the VAT Act (e.g. diplomats, consular agents, representatives of a special mission or international organisation, persons belonging to the armed forces of NATO, etc.) are exempt from the obligation to pay VAT if they acquire a new means of transport from another Member State.

A new means of transport is not taxed if it was taxed in another Member State and brought to Estonia in connection with a change of residence (Article 2 of Council Implementing Regulation 282/2011).

Last updated: 03.08.2022

Last updated: 06.09.2022

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