The new VAT scheme for Small Businesses (SME scheme) will apply as of 1 January 2025. This scheme allows small businesses to extend their activities to other Member States beyond their country of establishment, lifting the obligations and administrative burdens that currently apply to their activities in other Member States (e.g., obtaining a VAT number, submission of Vat Returns according to the national rules of each Member State, etc.).

This new scheme allows small businesses to expand their activities across the EU with reduced administrative burdens, facilitating growth and cross-border operations.

The main features of this new scheme are:

• Use of the SME scheme: Businesses can use the SME scheme with simplified procedures, not only in the Member State of establishment but also in any other Member State that applies an SME scheme.

• Application for exemption: From January 1, 2025, to obtain the exemption from another Member State, the SME will submit an application to the Tax Administration of its Member State of establishment (MSEST), which will then forward it to the Member State from which the business seeks the exemption (MSEXE), along with details about the business's turnover across the EU during the current or previous year.

• Thresholds: Small businesses using the SME scheme in more than one Member State can conduct annual transactions up to €100,000 in total across the EU, while the threshold set by a member state cannot be higher than €85,000. Greece currently has a threshold of €10,000.

• Cross-border exemption: The cross-border exemption is activated by registering the business in the SME scheme of any other Member State that applies this scheme. Once registered, it can conduct transactions with those Member States without needing to register for VAT purposes (e.g., obtaining a VAT number, submitting Vat Returns, etc.), provided it complies with the obligations applied by each Member State for exempted small businesses within its territory.

• Procedure for Greek businesses: From January 1, 2025, a Greek business can apply to use the SME scheme in any other EU Member State provided its turnover in the previous and current year does not exceed annually €100,000 in total across the EU and also does not exceed the internal exemption threshold of each Member State where it applies for the exemption. To use this option, it will submit an electronic application to the Tax Administration, including details regarding compliance with the thresholds. The request will be electronically forwarded to the Tax Administrations of the other Member States from which the exemption is requested. This option will be available to the Greek business whether it uses the SME scheme in Greece or not.

• Procedure for businesses from other Member States: A business established in another Member State, e.g., in France, which uses the SME scheme in France, can apply through the French Tax Administration to use the SME scheme in Greece. Its request will be forwarded to the Greek Tax Administration with the aforementioned procedure, accompanied by details of its transactions both across the EU and within Greece. The same applies if the French business uses the SME scheme in France. In both cases, the total exempt transactions that it can conduct across the EU cannot exceed €100,000 annually, and in Greece, it cannot exceed the domestic annual exemption threshold of €10,000.