On 12 August 2022, the Lithuanian Parliament accepted for consideration Bill (No. XIVP-1915), relating to the VAT Law on Calculating the VAT Registration Threshold for Related Persons.
Accordingly, when related persons carry out economic activity, they would be given a right to prove that there is no artificial business division and, as a result, they are not subject to the provision of calculation based on the total amount of income received, for the purposes of obligatory VAT registration.
The bill also contains measures to exempt related persons from registering as VAT payers if they can prove that:
1) None of their governing bodies and/or individual members of governing bodies are the same person; and
2) They engage in independent economic activities because their core economic activities are not of the same nature, and they do not act for the benefit or in the interests of one another.
If approved by the Parliament, the amendments would come into force on 1 January 2023.
