Latvia Pašnodarbinātais — IIN Declaration & VSAOI Return

Confirm the client is registered with VID as a self-employed person (pašnodarbinātais) carrying out saimnieciskā darbība (economic activity). Verify tax residency, determine the applicable regime (general income-tax regime vs micro-enterprise tax / MET), and establish whether VAT registration is required or already in place. Economic-activity registration is mandatory once annual income exceeds EUR 3,000.

Systematically classify all credits on the client's bank statement (Swedbank, SEB, Citadele, Luminor, Revolut Business, or Wise) as economic-activity income, employment income, capital income, or excluded transfers. For VAT-registered clients, strip the 21% PVN to arrive at net economic-activity income. Match platform payouts (Stripe, PayPal, Wise, Upwork) back to underlying invoices.

Identify and classify all deductible business expenses against economic-activity income (deductions do not apply under the MET regime). Separate fully deductible expenses (office rent, professional fees, software subscriptions, business travel) from apportionable items (home-office utilities, mixed-use phone/internet, vehicle fuel) and capital items requiring depreciation. Apply conservative defaults (0% deduction) for any mixed-use item without supporting documentation.

Compute mandatory social-insurance contributions (VSAOI) for the self-employed person. Where monthly income is EUR 700 or more (EUR 740 from 2025 minimum-wage base), VSAOI is 31.07% (or 29.36% if pension-age) on a freely-chosen object at or above the minimum base. Where monthly income is below EUR 700, a 10% contribution to state pension insurance applies on the actual income. VSAOI payments are tracked separately and are not a deductible expense for PIT purposes.

Compute the annual personal income tax (iedzīvotāju ienākuma nodoklis / IIN) across all income streams. Apply the 2025 progressive brackets: 25.5% on annual income up to EUR 105,300; 33% on the portion above EUR 105,300; an additional 3% surtax on the portion above EUR 200,000. Apply the fixed non-taxable minimum of EUR 510/month (EUR 6,120/year) and any applicable dependant, disability, or pensioner allowances. Credit any advance tax payments (avansa nodoklis) and employer-withheld PIT.

If the client realised capital gains (share sales, property disposals, or other asset sales) during the year, compute the gain, apply the flat 25.5% rate, and determine whether quarterly GD/GDz returns were required (gains exceeding EUR 1,000 in a quarter must be reported by the 15th of the month following the quarter). Dividends from Latvian companies that have already borne Latvian CIT are PIT-exempt; confirm CIT status for each dividend received.

For clients registered for Latvian VAT (PVN) at the standard 21% rate, confirm that monthly or quarterly PVN returns have been submitted via EDS and that input-tax credits on business expenses have been correctly claimed. Verify that the EUR 50,000 registration threshold has not been exceeded without registration, and flag any reverse-charge obligations on EU cross-border services received.

Prepare and file the annual income declaration (GID — Gada ienākumu deklarācija) via the VID Electronic Declaration System (EDS, eds.vid.gov.lv). The filing deadline is 1 March to 1 June of the following year; if annual income exceeds EUR 105,300, the extended deadline of 1 April to 1 July applies. Reconcile any balance due (samaksai budžetā) or refund (pārmaksa), and confirm that the self-employed annual VSAOI report has been submitted to VID by 17 January.