Latvia taxes

Taxation in Latvia, Taxes for companies in Latvia.

Latvia is very attractive jurisdiction in respect to other European jurisdictions regarding taxes. In addition to corporate profit tax, companies having place of business in Latvia have to pay value added tax (VAT), real estate tax, customs and excise duties, social security contributions and a natural resource tax.

Standard tax rate for corporations is 15% and applies for trading profits. There is no remittance tax for Latvian branch. Micro-enterprises pay 9% tax from the annual turnover.

Dividends will not be taxable income starting of 1st January 2013 as Latvia introduces and recognizes holding corporate structure. The exemption applies to residents and non-residents as well as natural persons and legal entities which are not registered in low tax states and territories (tax heavens). It is expected to facilitate business through Latvian companies and restrict transactions with offshore companies.

Interests are taxed at 10% and royalties at 15%. There is no branch remittance tax.

Corporation tax is tax charged on profits calculated from incomes that are shown through financial statements. Some expenses are not allowed like in other jurisdictions.

Other factors that make Ireland very attractive location:

  • 15% corporate tax on trading profits
  • Tax exemption on capital gains on the disposal of shares
  • Exemptions from dividend, interest and royalty withholding tax
  • Wide range of signed treaties
  • Holding company allowance
  • Access to the EU funds

Latvia has wide network of double tax treaties signed based on the OECD model.

Revenue Commissioners is the tax authority in Ireland with primary duty to collect taxes and duties.

Standard VAT rate is 21%. The reduced tax rate is 12%. The reduced tax rate applies to: medical supplies; milk and dairy products; regular inland transportation services of passengers and their baggage; delivery of textbooks and the original literature; accommodation services; delivery of wood fuel, heat etc.

If you have questions about taxation in Latvia, do not hesitate to contact us.