FAQ: The VAT rate increase to 24% on July 1st 2025 In Estonia

What is taking place? 

As of July 1st, the standard rate of VAT in Estonia is 24% instead of the current 22%.
The reduced VAT rates will remain unchanged at 13% & 9% .

Will the 22% rate be removed after July 1st?
No, the 22% rate will remain available.

How will this be managed in Briox?

This will be managed automatically in Briox.
The invoice date will decide if the VAT rate is 22% or 24%.
Both rates will be posted to the same account and reported in box 4 of the VAT report for customer invoices (sales).
The Sales of goods and services will be posted to box 1 of the VAT report as usual.
For supplier invoices (purchases), the new rate och 24% will be reported on the same accounts alongside the old VAT rate, and reported in the same Boxes of the VAT report.

The functionality has been released on may 19th 2025.


What do I need to do?

The only thing you, as a user, will need to do after September 1st , is change the name of the account you use if you do not want it to have 22% in its name any longer.
Please note that the name of the account does not affect the VAT rate as both rates will be posted to the same account during the transition period.
Read how to change the name of your account here, in the section called Account settings.
After we have released the functionality for managing the VAT increase, all accounts created using any Briox standard Chart of Accounts will automatically have accounts with 24% in their account name.

What happens on July 1st?

When you create an invoice or post a journal with a date on or after July 1st, you will automatically get the new VAT rate of 24% when selecting the standard VAT.

I am using both a posting date and an invoice date, how does this work?

It is always the invoice date that will be taken into account when the VAT rate is to be determined.

Read more about enabling an extra date field. 

SUPPLIER INVOICES 

I have set VAT rates on my suppliers in the registry. What happens to them?

As in the rest of the program, if you have set a VAT rate of 22% on your supplier in the registry, the VAT rate will be automatically updated to reflect the change taking place on July 1st.

How can I have an invoicing date in July and have a 22% VAT Rate on my supplier invoice?

How can I have an invoicing date in July and both 22% and 24% VAT on one invoice?

In both cases you must select the option Multiple VAT rates in the VAT drop down menu in the invoice header.
This will allow you to freely code in the accounting grid.
Use a template to automatically calculate your 22% VAT in the supplier invoice. These are easily created by copying existing ones.

CUSTOMER INVOICES

How can I have an invoicing date in July and have a 22% VAT Rate on my customer invoice?

How can I have an invoicing date in July and both 22% and 24% VAT on one invoice?

In both cases, you need to set up a specific account for your 22% VAT rate.

1. Create a sales account in your chart of accounts.This is easily done by copying your standard sales account.
   
   
2. Choose the VAT code and Save.
   • MP_STANDARD_TEMP for domestic sales VAT 22%

3. The VAT will automatically default to your standard VAT accounts.
   If you wish to post your VAT to other accounts, please select which in the default accounts. Go to Registry - Chart of Accounts - Default accounts and update the account marked in red below.
   
   
   
   
4. When you create your customer invoice you will need to choose your new account on the item row of the invoice.
   
   
   
   Note: You can only choose a different VAT account for the item in the desktop platform.

Read more about the change on Estonian Tax and Custom Board page: https://www.emta.ee/en/business-client/taxes-and-payment/value-added-tax#from-01012025