HomePage Contact Us About Us Advertise with us
Custom Search

Latvia  Income Taxes and Tax Laws













Last partial update, February 2015
  • An individual's business and salary income is taxable, as at 2015, at the rate of 23%.
    The tax rate for An individual's capital gain is 15%.The tax rate for other investment income is 10%.
  • Exemptions are granted to taxpayers with specific types of income.
  • The standard rate of tax for a corporation in 2015 is 15%.
    Micro enterprises pay 9% on their turnover.
Income Tax for an Individual
  • An individual in Latvia is liable for tax on his income as an employee and on income as a self-employed person.
    In the case of an individual who answers the test of a "permanent resident" of Latvia, tax will be calculated on his income earned in Latvia and overseas.
    A foreign resident pays tax only on his income in Latvia.
  • To be considered a Latvian resident, an individual must meet the requirement of residence in Latvia for at least 183 consecutive days in a 12 month period that begins or ends in the calendar tax year. Occasionally, an individual will be considered a Latvian resident even if he is resident in Latvia for less than 183 days if he/she owns a home in Latvia that is his/her permanent residence.
  • An employer is obligated to deduct, immediately, each month, the amount of income tax and national insurance due from a salaried worker.
  • Certain payments are deducted from taxable income, as will be specified further.
Corporate Tax in Latvia

  • The standard rate of corporate tax in 2015 in Latvia is 15%.
  • A new company may ask for its first financial statements to be submitted for a period of up to 18 months from the date on which the company was founded.




Latvia Capital Gains

  • Foreign, non-resident, companies that sell real estate in Latvia, must deduct a final tax of 2% from the proceeds of the sale.
  • Capital gains of companies in Latvia are added to regular income.
  • Individuals pay 15% capital gain tax on sale of real estate and other assets, including shares.


Latvia Reporting Dates and Payment

  • The tax year in Latvia ends on December 31, however companies may select a special tax period.
  • A limited company submits its annual return up until 4 months from the end of the tax year. Large companies may submit their annual reports up to 7 months from the end of the tax year.
  • The tax due must be paid within 15 days of submission of the annual return.



Latvia Deduction of Tax at Source

Taxation of Employees
  • As regards salaried employees, the employer is obligated to deduct tax at source from the salaried employee and to make additional contributions to social security.
  • In 2015, the employer's contribution to national insurance is 23.59% and that of the employee - 10.50%.
  • Self employed pay 32.46% for national insurance.
  • A non-resident who is employed in Latvia by a non-Latvian company pays national insurance at the rate of 32%.


Tax must be deducted at source for foreign residents on the following basis:
  • Dividend - the usual deduction is 0%/15%/30%.
  • Interest - the deduction at source 0%/15%.
  • Royalties - deduction at source of 5%/15%.
  • Payments for management and consulting services - 10%/15% deduction at source.
  • Receipts from the sale of real estate in Latvia - 2% deduction at source.
  • Real estate rental - 5%/15%.


Comments:
  • Deduction at source for payments to foreign residents is subject to the Double Taxation Prevention Treaty.
  • In most cases, there is an exemption for deduction at source on a dividend paid to shareholders who are residents of the EU or EEA countries.
  • In most cases, payments to foreign residents that are defined as a "tax haven" must have tax deducted at source at the standard rate of corporation tax in Latvia.







Austria Income Taxes and Tax Laws | Brazil Income Taxes and Tax Laws | Bulgaria Income Taxes and Tax Laws | BVI Income Taxes and Tax Laws | Canada Income Taxes and Tax Laws | China Income Taxes and Tax Laws | Croatia Income Taxes and Tax Laws | Cyprus Income Taxes and Tax Laws | Czech R. Income Taxes and Tax Laws | Estonia Income Taxes and Tax Laws | Finland Income Taxes and Tax Laws | France Income Taxes and Tax Laws | Germany Income Taxes and Tax Laws | Greece Income Taxes and Tax Laws | Hong Kong Income Taxes and Tax Laws | Hungary Income Taxes and Tax Laws | India Income Taxes and Tax Laws | Iran Income Taxes and Tax Laws | Ireland Income Taxes and Tax Laws | Israel Income Taxes and Tax Laws | Italy Income Taxes and Tax Laws | Japan Income Taxes and Tax Laws | Latvia Income Taxes and Tax Laws | Lithuania Income Taxes and Tax Laws | Malta Income Taxes and Tax Laws | Mexico Income Taxes and Tax Laws | Montenegro Income Taxes and Tax Laws | Netherlands Income Taxes and Tax Laws | Poland Income Taxes and Tax Laws | Portugal Income Taxes and Tax Laws | Romania Income Taxes and Tax Laws | Russia Income Taxes and Tax Laws | Serbia Income Taxes and Tax Laws | Slovakia Income Taxes and Tax Laws | Slovenia Income Taxes and Tax Laws | Spain Income Taxes and Tax Laws | Singapore Income Taxes and Tax Laws | Tunisia Income Taxes and Tax Laws | Turkey Income Taxes and Tax Laws | U.K. Income Taxes and Tax Laws | Ukraine Income Taxes and Tax Laws | U.S.A. Income Taxes and Tax Laws

Go Back

© All copyrights reserved

Latvia Homepage | Security Policy | Terms of Service