Latvia

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Tax Overview in Latvia

LatviaTax year 2026

Tax overview for Latvia, tax year 2026: the State Revenue Service (VID), the calendar tax year, residence (declared home or 183 days in any 12 months), personal income tax at 25.5% and 33% with the band at EUR 105,300 and a 3% surcharge above EUR 200,000, the EUR 550 monthly non-taxable minimum, corporate income tax of 20% on distributed profit divided by 0.8 (optional 15% with a 0.85 divisor plus 6% personal tax for companies owned only by individuals), micro-enterprise tax at 25% of turnover, VAT at 21% with a EUR 50,000 registration threshold, social contributions of 34.09%, and the main filing and payment dates.

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Cross Border in Latvia

Latvia Cross-BorderTax year 2026

Hub skill for crossing the Latvian border in tax year 2026. Covers tax residence for individuals (declared home, or 183 days in any 12-month period, Law On Taxes and Fees section 14) and companies (incorporated under Latvian law); permanent establishment, including services over 30 days in any 6 months; Latvian-source income of non-residents; corporate income tax withholding on payments to non-residents (20% on management and consulting fees, 3% on real estate sales, 5% on real estate rent, 20% on all payments to low-tax or no-tax jurisdictions); treaty relief and the non-resident's net-basis refund report; foreign tax credit; the exit charge when assets leave Latvian taxing rights.

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Latvia VAT Return

Latvia VAT / GSTTax year 2026

Latvian value added tax (pievienotās vērtības nodoklis, PVN) for tax year 2026 under the VAT Law (Pievienotās vērtības nodokļa likums) as in force from 1 January 2026. Covers who must register (EUR 50,000 domestic threshold, the EUR 5,000 tolerance, the EUR 10,000 limit for EU acquisitions), the EU small-enterprise scheme (EUR 100,000 EU turnover), the 21%, 12% and 5% rates and what sits at each, including bread, milk, poultry and eggs at 12% from 1 July 2026 to 30 June 2027, input VAT limits for cars and entertainment, the domestic reverse charges, monthly and quarterly periods, the return by the 20th and payment by the 23rd, the EU sales list, structured e-invoices, late-filing fines and 0.05% a day late interest.

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Latvia Payroll

Latvia PayrollTax year 2026

Latvian payroll for tax year 2026: how an employer computes and withholds wage tax (algas nodoklis) and state social insurance contributions (VSAOI) each month. Covers the flat 25.5% monthly withholding, the EUR 550 monthly non-taxable minimum and EUR 250 dependant relief through the wage tax book, employee 10.5% and employer 23.59% contributions, the EUR 105,300 maximum base and solidarity tax, the EUR 780 minimum wage and the EUR 2,340 quarterly minimum contribution base, the employer's monthly report by the 17th and payment by the 23rd, the 33% band settled in the annual return, and late-payment interest of 0.05% a day.

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Latvia Social Contributions

Latvia PayrollTax year 2026

Latvian state social insurance contributions (VSAOI) for tax year 2026. Covers the 34.09% rate for employees (employer 23.59%, employee 10.50%) and the reduced rates for pensioners, board members and others, the EUR 105,300 maximum base and the solidarity tax above it with the refund down to 25%, the EUR 780 minimum wage and the EUR 2,340 quarterly minimum contribution base for employees, self-employed contributions (31.07% on at least EUR 780 a month plus 10% for pensions), quarterly reports by the 17th and payment by the 23rd, workers of foreign employers (31.83%), and late interest of 0.05% a day.

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Company Formation in Latvia

Latvia Company FormationTax year 2026

Setting up a business in Latvia for tax year 2026, from the Commercial Law (Komerclikums) in force from 1 January 2026, the Enterprise Register (Uzņēmumu reģistrs) service pages, and the tax laws and State Revenue Service (VID) pages the pack already uses. Covers the legal forms (limited liability company SIA, small-capital SIA, joint stock company AS, individual merchant IK, general and limited partnerships, branch of a foreign merchant), share capital (SIA EUR 2,800, small-capital SIA below that with a 25% reserve, AS EUR 25,000), paying in the capital, the registration steps, fees from EUR 20 to EUR 85, the 1 to 3 working day review, electronic-only filing from 7 January 2027, and the first tax and filing duties. Use for 'set up a company in Latvia', 'SIA share capital', 'Latvian company registration fee'. Out of scope: company tax detail (lv-corporate-income-tax), VAT returns (latvia-vat-return), payroll (latvia-payroll), cross-border (lv-cross-border).

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Latvia Income Tax

Latvia Income TaxTax year 2026

Latvian personal income tax (IIN) for tax year 2026, for resident employees, self-employed people, pensioners and people with capital income. Covers the 25.5% and 33% bands with the threshold tied to the EUR 105,300 maximum social insurance base, the 3% surcharge above EUR 200,000, the fixed EUR 550 monthly non-taxable minimum, EUR 250 monthly dependant relief, the EUR 12,000 pensioner minimum, eligible expenses, capital income at 25.5%, business income and losses, the annual return (1 March to 1 June, or 1 April to 1 July), payment dates, penalties and 0.05% a day late interest.

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Latvia Tax Optimization

Latvia Tax OptimizationTax year 2026

Legal tax planning in Latvia for tax year 2026, for self-employed people and small companies. Covers the distributed-profits corporate income tax (0% on retained profit, 20% of the distribution divided by 0.8), the optional 15% rate with a 0.85 divisor plus 6% personal income tax for companies owned only by individuals, micro-enterprise tax at 25% of turnover and who may choose it, the self-employed (FIK) versus company (SIA) choice with 25.5% and 33% personal income tax and 31.07% social contributions, personal reliefs, and the deemed-distribution red lines.

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Transfer Pricing in Latvia

Latvia Transfer PricingTax year 2026

Latvian transfer pricing for tax year 2026 under the distribution-based Corporate Income Tax Law: who counts as a related person (Law on Taxes and Fees, article 1(18)), the arm's length price difference taxed as a deemed profit distribution (CIT Law, article 4(2)(2)(e), base divided by 0.8 and taxed at 20%), the methods and 5% mark-up for low value-adding services (Cabinet Regulation No. 677), and the documentation rules in article 15.2 as amended from 1 January 2026: a controlled transactions report filed above EUR 250,000, a local file above EUR 250,000, a master file above EUR 20,000,000, production deadlines, the penalty of up to 1% capped at EUR 100,000, the EUR 750m country-by-country report, and advance pricing agreements above EUR 1,430,000.

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Corporate Income Tax in Latvia

Latvia Corporate TaxTax year 2026

Latvian corporate income tax for tax year 2026 under the Corporate Income Tax Law (Uzņēmumu ienākuma nodokļa likums) in force from 1 January 2026. Latvia taxes a company only when it distributes profit: 20% of the amount divided by 0.8. Covers who pays, the optional 15% rate with a 0.85 divisor for dividends of companies owned only by individuals (plus 6% personal income tax), deemed distributions (non-business expenses, bad debts, excess interest, loans to related persons, transfer pricing adjustments), dividends received, the 36-month share disposal relief, pre-2018 profits and losses, the monthly return by the 20th and payment by the 23rd, the EUR 50 minimum, fines and 0.05% a day late interest.

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