Source-cited draft: corporate income tax for Latvia (tax year 2025) — rates, thresholds and rules with primary-source citations. Unverified; pending local-accountant review.
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CIT rate on distributed profits
20% applied to the gross-up base (taxable base ÷ 0.8), i.e. 20/80 of the net distribution = an effective 25% rateCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/taxes-on-corporate-income
CIT rate on retained / reinvested profits
0% (tax is deferred until profit is distributed)Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/taxes-on-corporate-income
Tax base
Distributed profits, deemed distributions, non-business expenses, and certain transfer-pricing/excess-debt adjustments — not annual accounting profit as suchCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/income-determination
CIT calculation
CIT = (net distribution ÷ 0.8) × 20%Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/taxes-on-corporate-income
Alternative regime for individual-owned companies (from 2026)
Distributed profits taxed at 15% CIT (15/85 of net) plus 6% PIT withheld from the individual (approx — confirm; takes effect 1 January 2026)Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/taxes-on-corporate-income
Withholding tax on dividends to non-residents
0% (general); 20% if paid to a company in a listed low-tax/non-cooperative jurisdictionCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/withholding-taxes
Withholding tax on interest to non-residents
0% (general); 20% if paid to a company in a listed low-tax/non-cooperative jurisdictionCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/withholding-taxes
Withholding tax on royalties to non-residents
0% (general); 20% if paid to a company in a listed low-tax/non-cooperative jurisdictionCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/withholding-taxes
Withholding tax on management and consulting fees to non-residents
20% (may be reduced to 0% under a tax treaty with no PE and a valid residence certificate)Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/withholding-taxes
Withholding tax on real-estate proceeds to non-residents
3% on proceeds from disposal of Latvian real estate; 5% on rental income from Latvian real propertyCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://taxsummaries.pwc.com/latvia/corporate/withholding-taxes
CIT return and payment deadlines
Return by the 20th of the month following the month in which a tax base arises; tax paid by the 23rdCorporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) — https://www.vid.gov.lv/en/corporate-income-tax
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Latvia operates a distribution-based (Estonian-style) corporate income tax: profits are taxed only when distributed or deemed distributed, so retained and reinvested earnings carry a 0% rate.
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