16Thursday, May 16, 2019

Dividends and building up the shareholding structure for Latvian companies

Thursday, May 16, 2019|0 Comments

This article describes the principles of planning dividends and shaping the tax-effective shareholding structure for Latvian companies. […]

10Sunday, February 10, 2019

New Latvian Controlled Foreign Companies Rules

Sunday, February 10, 2019|0 Comments

As of 1 January 2019 Latvia has introduced controlled foreign companies rules by amending the Corporate Income Tax Act. According to the rules a Latvian company has to apply the CFC rules, if it: […]

26Saturday, January 26, 2019

Intangible assets revaluation

Saturday, January 26, 2019|0 Comments

Question: Latvian company A has sold a trademark to another Latvian related company B. Company B has licensed back to A the rights to use the trademark. The arm’s length value of the trademark was assessed using a discounted cash flow analysis. After a couple of years, it appears that the sales of the group are unexpectedly higher than assumed for valuation. Can the trademark be revalued in the books of B? What is the effect on transfer pricing? […]

29Monday, October 29, 2018

New transfer pricing documentation requirements in Latvia

Monday, October 29, 2018|0 Comments

Introduction On 25 October 2018 the long-awaited amendments to the Taxes and Duties Act regarding the transfer pricing documentation requirements were finally passed. […]

2Sunday, September 2, 2018

Employee stocks and stock options

Sunday, September 2, 2018|0 Comments

On 15 June 2017, the Saeima adopted comprehensive amendments to the Commercial Law (these amendments entered into effect on 13 July 2017), which, inter alia, also governs matters regarding employee stock and personnel options. […]

28Saturday, April 28, 2018

How to determine the market value of interest on loans to associated companies

Saturday, April 28, 2018|0 Comments

  Associated companies frequently issue loans to each other, which must, like other transactions between associated companies, conform to market value. Currently, this issue has received additional topicality due to the fact that interest payments that exceed their market value are considered to be equivalent to dividend payments. This means that the issue of determining the market value of interest rates will become more topical. […]

31Saturday, March 31, 2018

Intra EU Goods Transport Treatment in Single Market

Saturday, March 31, 2018|0 Comments

Haulier Customer Conditions VAT position Latvia VAT payer Latvia VAT payer Freight transportation within the EU Haulier applies Latvian VAT (21%) Latvia VAT payer Other EU State VAT payer Freight transportation within the EU Haulier does not apply Latvian VAT. The Customer has to apply its country’s VAT according to the reverse charge rule Latvia VAT payer VAT non-taxable person (e.g. individual) Freight transportation within the EU which starts in Latvia Haulier applies the Latvian VAT, since the transportation starts in Latvia Latvia VAT payer VAT non-taxable person (e.g. individual) Freight transportation within the EU which ends in Latvia The place of supply is the EU State where the transportation starts, so the haulier has to register in that country as  a VAT payer and apply that country’s VAT Other EU State VAT payer Latvia VAT payer Freight transportation within the EU which starts in Latvia Haulier does not apply VAT. The Customer has to apply Latvian VAT according to the reverse charge rule Other EU State VAT payer VAT non-taxable person (e.g. individual) Freight transportation within the EU which starts in Latvia Haulier has the obligation to register and pay VAT in Latvia, since the transportation starts in Latvia Other EU State VAT payer VAT non-taxable person (e.g. individual) Freight transportation within the EU which ends in Latvia  Latvian VAT does not apply. The haulier has to apply the VAT in the country where the transportation starts  Latvia VAT payer  VAT payer or an individual  Import of goods in Latvia  If the transportation costs are included in the VAT taxable amount, the service is subject to 0% VAT  Latvia VAT payer  VAT payer or an individual  Import of goods in Latvia, if the final destinatination is another EU State  Transportation with the EU. However, if the transportation expenses are included in the value of the goods, the service is subject to 0% VAT.  Other EU State payer  VAT payer or an individual  Importation of the goods in another EU State, provided that Latvia is final destination  Transportation with the EU. However, if the transportation expenses are included in the value of the goods, the service is subject to 0% VAT. […]

16Saturday, December 16, 2017

New Corporate income tax in Latvia: How to benefit?

Saturday, December 16, 2017|0 Comments

Introduction New Latvian corporate income tax: how to benefit from it? […]

29Wednesday, November 29, 2017
6Friday, October 6, 2017

How to finance a Latvian company in future

Friday, October 6, 2017|0 Comments

The new Corporate Income Tax Act into force on 1 January 2018. One of the declared goals of the corporate income tax was to facilitate the companies’ capitalization and thus, “reinvesting” of the profits earned. Therefore, the corporate income tax is payable only when the dividends are distributed or if the company incurs expenses which are considered to be profit distribution. […]

20Wednesday, September 20, 2017

Changes in the Latvia tax laws effective as of 1 January 2018

Wednesday, September 20, 2017|0 Comments

Corporate income tax In the new Latvian Corporate Income Tax Act (hereinafer – the Act) a conceptually new regime for payment of the corporate income tax was established. The act intends to postpone payment of the tax until the profit is distributed or in other way redirected to the expenses that do not ensure further development of the taxpayer, i.e. taxation is transferred from the moment of the derivation of profit to the moment of the distribution of profit. Thus the tax shall be paid notwithstanding the amount of income gained within the year only in a case that the taxpayer distributes profit in dividends or comparable expenses, carries out tasks unrelated to economic activity, increased interest payments, provides loans to related persons, etc. […]

12Monday, August 12, 2013

Expatriate employment options in Latvia

Monday, August 12, 2013|0 Comments

The article outlines the tax implications arising from the international assignment of an employee from the European Union company (home company) to Latvia (host company). In such situations there are usually two options that could be considered: (1) secondment to Latvia and (2) local employment contract. […]