# latvia-vat-return

## Latvia PVN Return Skill (PVN 1) v2.0

## Section 1 — Quick reference

Read this whole section before classifying anything. The workflow runbook is in `vat-workflow-base` Section 1. The EU directive content is in `eu-vat-directive`.

**Quick reference table**

| Field | Value |
| --- | --- |
| Country | Latvia (Latvija) |
| Standard rate | 21% |
| Reduced rates | 12% (food, pharmaceuticals, hotel accommodation, domestic heating, passenger transport, books/periodicals), 5% (locally produced fruits/vegetables — seasonal) |
| Zero rate | Exports, intra-EU B2B supplies |
| Return form | PVN deklaracija (PVN 1) |
| Filing portal | https://eds.vid.gov.lv (EDS) |
| Authority | Valsts ienemumu dienests (VID) |
| Currency | EUR |
| Filing frequency | Monthly (intra-EU or turnover > EUR 50,000), quarterly (EUR 14,228-50,000), bi-annual (< EUR 14,228) |
| Deadline | 20th of month following period |
| Companion skill (workflow) | vat-workflow-base v0.1+ |
| Companion skill (EU directive) | eu-vat-directive v0.1+ |
| Contributor | Open Accountants Skills Registry |
| Validated by | Pending — requires validation by licensed Latvian accountant |
| Validation date | Pending |

**Conservative defaults**

| Ambiguity | Default |
| --- | --- |
| Unknown rate on a sale | 21% |
| Unknown PVN status of a purchase | Not deductible |
| Unknown counterparty country | Domestic Latvia |
| Unknown B2B vs B2C for EU customer | B2C, charge 21% |
| Unknown business-use proportion | 0% recovery |
| Unknown blocked-input status | Blocked |

**Red flag thresholds**

| Threshold | Value |
| --- | --- |
| HIGH single-transaction size | EUR 3,000 |
| HIGH tax-delta on a single conservative default | EUR 200 |
| MEDIUM counterparty concentration | >40% |
| MEDIUM conservative-default count | >4 |
| LOW absolute net PVN position | EUR 5,000 |

## Section 2 — Required inputs and refusal catalogue

### Required inputs

- **Minimum viable** — bank statement for the period. Acceptable from: Swedbank Latvia, SEB banka, Citadele, Luminor, BlueOrange, or any other.
- **Recommended** — sales/purchase invoices, VAT number (LV + 11 digits).
- **Ideal** — complete invoice register, prior PVN 1.

### Latvia-specific refusal catalogue (supplements eu-vat-directive R-EU-1 through R-EU-12)

- **R-LV-1 — Micro-enterprise tax regime** — Trigger: client is on micro-enterprise tax. Message: "Micro-enterprise taxpayers may have different PVN obligations. Flag for reviewer."  _(R-LV-1)_
- **R-LV-2 — Partial exemption** — Trigger: mixed taxable/exempt. Message: "Pro-rata required. Flag for reviewer."  _(R-LV-2)_
- **R-LV-3 — Timber/construction domestic reverse charge** — Trigger: timber or construction services. Message: "Domestic reverse charge applies for timber and construction. Specialist analysis required."  _(R-LV-3)_

## Section 3 — Supplier pattern library

### 3.1 Latvian banks (fees exempt — exclude)

**3.1 Latvian banks (fees exempt — exclude)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| SWEDBANK, SEB, CITADELE, LUMINOR | EXCLUDE for fees | Financial service exempt |
| PROCENTI, INTEREST | EXCLUDE | Interest exempt |

### 3.2 Government (exclude)

**3.2 Government (exclude)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| VID, VALSTS IENEMUMU DIENESTS | EXCLUDE | Tax payment |
| VSAA | EXCLUDE | Social security |
| UZNEMUMU REGISTRS | EXCLUDE | Company registration |

### 3.3 Utilities

**3.3 Utilities**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| LATVENERGO, SADALES TIKLS | Domestic 21% | Electricity |
| LATVIJAS GAZE, ENERĢIJAS PUBLISKAIS TIRGOTĀJS | Domestic 21% | Gas/heating — check 12% for domestic heating |
| LMT, TELE2, BITE | Domestic 21% | Telecoms |

### 3.4 SaaS — EU (reverse charge)

**3.4 SaaS — EU (reverse charge)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| GOOGLE IRELAND, MICROSOFT IRELAND, ADOBE IRELAND | EU reverse charge | Intra-EU services |
| SPOTIFY AB (SE), ATLASSIAN (NL) | EU reverse charge | Same |

### 3.5 SaaS — non-EU (reverse charge)

**3.5 SaaS — non-EU (reverse charge)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| NOTION, ANTHROPIC, OPENAI, FIGMA, CANVA | Non-EU reverse charge |  |
| GITHUB (US) | Non-EU reverse charge | Check if billed by IE entity |

### 3.6 Food and entertainment (blocked)

**3.6 Food and entertainment (blocked)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| RIMI, MAXIMA, LIDL, TOP, MEGO | Default BLOCK | Personal provisioning |
| RESTORĀNS, KAFEJNĪCA | Default BLOCK | Entertainment — 60% cap on representation |

### 3.7 Insurance (exempt)

**3.7 Insurance (exempt)**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| BALTA, BTA, IF APDROŠINĀŠANA | EXCLUDE | Insurance exempt |

### 3.8 Professional services

**3.8 Professional services**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| ZVĒRINĀTAIS REVIDENTS, AUDITORS | Domestic 21% |  |
| ADVOKĀTS, JURISTA BIROJS | Domestic 21% |  |
| NOTĀRS | Domestic 21% |  |

### 3.9 Internal transfers

**3.9 Internal transfers**

| Pattern | Treatment | Notes |
| --- | --- | --- |
| IEKŠĒJAIS PĀRSKAITĪJUMS | EXCLUDE |  |
| ALGA, DARBA SAMAKSA | EXCLUDE | Salary |

## Section 4 — Worked examples

### Example 1 — Non-EU SaaS reverse charge

**Input:** `NOTION LABS INC ; DEBIT ; EUR 14.68`
**Treatment:** Non-EU reverse charge. Output and input PVN at 21%. Net zero.

### Example 2 — EU service reverse charge (Google Ads)

**Input:** `GOOGLE IRELAND LIMITED ; DEBIT ; EUR 850.00`
**Treatment:** EU reverse charge. Intra-EU services. Output and input PVN at 21%.

### Example 3 — Entertainment (representation — 60% cap)

**Input:** `RESTORĀNS VINCENTS ; DEBIT ; EUR 220`
**Treatment:** Representation expenses have 60% PVN recovery cap in Latvia. Flag for reviewer. Conservative default: 0%.

### Example 4 — Capital goods

**Input:** `DELL TECHNOLOGIES ; DEBIT ; EUR 1,595`
**Treatment:** Capital goods. Input PVN at 21%.

### Example 5 — EU B2B service sale

**Input:** `STUDIO KREBS GMBH (DE) ; CREDIT ; EUR 3,500`
**Treatment:** B2B service to EU customer. Zero-rated. Verify DE USt-IdNr via VIES.

### Example 6 — Motor vehicle, partial block

**Input:** `SIA AUTOCENTRS ; DEBIT ; car lease ; EUR 650`
**Treatment:** Latvia limits PVN recovery on passenger vehicles. Conservative default: 0%. Flag for reviewer.

## Section 5 — Tier 1 classification rules (compressed)

### 5.1 Standard rate 21%

- **Unknown rate on a sale** — 21%

### 5.2 Reduced rate 12%

- **Reduced rate 12%** — 12% (Food products, pharmaceuticals, hotel accommodation, domestic heating, passenger transport, books/periodicals.)

### 5.3 Reduced rate 5%

- **Reduced rate 5%** — 5% (Locally produced seasonal fruits and vegetables.)

### 5.4 Zero rate

- **Zero rate** — 0% (Exports, intra-EU B2B supplies (goods and services).)

### 5.5 Exempt without credit

- **Exempt without credit** — Financial services, insurance, medical, education, residential rental, postal universal service.

### 5.6 Reverse charge — EU services

- **Reverse charge — EU services** — Standard EU reverse charge per eu-vat-directive.

### 5.7 Reverse charge — non-EU services

- **Reverse charge — non-EU services** — Self-assess at 21%.

### 5.8 Domestic reverse charge

- **Domestic reverse charge** — Timber, scrap metal, construction services — domestic reverse charge.

### 5.9 Blocked input PVN

- **Blocked input PVN** — Entertainment (above 60% representation cap), passenger vehicles (limited recovery), personal use.

## Section 6 — Tier 2 catalogue (compressed)

### 6.1 Vehicle costs

- **Vehicle costs** — Default: 0%. Question: "Confirm vehicle type and business-use proportion."

### 6.2 Representation expenses

- **Representation expenses** — Default: 0%. Question: "60% cap applies for documented business representation. Confirm."

### 6.3 Timber/construction reverse charge

- **Timber/construction reverse charge** — Default: flag. Question: "Confirm if domestic reverse charge applies."

### 6.4 Mixed-use expenses

- **Mixed-use expenses** — Default: 0%. Question: "Business proportion?"

## Section 7 — Excel working paper template

Standard layout. Column H accepts PVN 1 row codes.

## Section 8 — Bank statement reading guide

**Format:** Swedbank/SEB CSV, DD.MM.YYYY, EUR. **Language:** Latvian or English.
**Internal transfers:** "Iekšējais pārskaitījums". Exclude.

## Section 9 — Onboarding fallback

### 9.1 PVN number

- **PVN number** — Fallback: "What is your PVN number? (LV + 11 digits)"

### 9.2 Filing frequency

- **Filing frequency** — Inference: from turnover. Fallback: "Monthly, quarterly, or bi-annual?"

### 9.3 Credit brought forward

- **Credit brought forward** — Always ask.

## Section 10 — Reference material

### Sources

1. Pievienotas vertibas nodokla likums (PVN likums) — Latvian VAT Act
2. EU VAT Directive 2006/112/EC
3. VID EDS portal — https://eds.vid.gov.lv

### Change log

- **v2.0 (April 2026):** Full rewrite to 10-section architecture with companion skill references.
- **v1.0-draft:** Initial skill.

## Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional (such as a CPA, EA, tax attorney, or equivalent licensed practitioner in your jurisdiction) before filing or acting upon.

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