Tax

An EU implementing regulation in force since 21 October 2026 lets businesses that imported goods from Indian producer "Varmora Granito Limited" since 14 May 2025 and paid the definitive anti-dumping duty apply to customs to correct their declared data and tax amounts. That means eligible importers are due a refund of overpaid anti-dumping duty. Relevant for companies importing ceramic tiles from India.

Under the Personal Income Tax Law, the monthly non-taxable minimum will rise to €570 in 2027 and will apply to all salaries regardless of gross income. For comparison, it was €510 in 2025 and €550 in 2026. The change will affect every employer's payroll tax calculations from 2027.

The article explains how to properly store structured e-invoices and how that differs from paper documents, including which format counts as the retainable original. It is topical as structured e-invoices become everyday practice in corporate accounting. Useful for businesses adapting their document-handling and archiving processes.

Citadele Bank's analysis shows Latvian fuel prices have jumped sharply over the past year — petrol up 26%, diesel up 36% — with diesel nearing the price level that has historically spurred interest in electric cars. New EV registrations rose 46% over nine months, mostly displacing petrol and diesel vehicles. The article notes a temporary excise-duty cut on fuel expires at year-end, so prices could rise further in early 2027.

Commission Implementing Regulation (EU) 2026/2319, in force since 21 October 2026, amends the annex to Regulation (EU) 2023/265: the Indian producer Varmora Granito Private Limited (TARIC code A013, individual anti-dumping rate 7.3%) is renamed Varmora Granito Limited. The code applies to the new name from 14 May 2025, and duty overpaid since then is to be refunded or remitted. Importers can ask customs to correct their declarations after release of the goods.

Amendments adopted by the Saeima on 15 October and promulgated on 22 October extend the investment-account regime to crypto-assets and introduce a one-off crypto-asset declaration taxed at 10 % of market value at 31 December 2026. The declaration is filed with the tax authority between 1 April and 31 May 2027 and the tax paid by 23 July, and it is unavailable to persons already under audit or criminal investigation. The law takes effect the day after promulgation.

The amendments exclude novice micro-enterprise taxpayers from one category of insured persons and let people voluntarily buy insurance cover for work and equivalent periods in 1991-1995 at 1 % of the minimum monthly wage per month. Voluntary contributions start on 1 October 2027, the relevant provision takes effect on 1 July 2027 and the law as a whole on 1 April 2027.

On 22 October 2026 Advocate General Rantos concluded that the temporary solidarity contribution on windfall profits of fossil-energy companies, introduced by a 2022 Council regulation, and the national measures built on it are consistent with EU law: Article 122(1) TFEU is a valid legal basis, the levy is not retroactive, does not disproportionately affect property rights, and is neither a charge equivalent to a customs duty nor State aid. Member States may widen the circle of payers provided the overall burden and aims stay equivalent to the regulation's. The Opinion does not bind the Court; the questions came from the Italian and Belgian Constitutional Courts and the Irish High Court.

Amendments to the Law on Control of Aid for Commercial Activity, drafted by the Finance Ministry, would require companies that received unlawful state aid to repay interest even if the European Commission later finds the aid compatible with the internal market. The bill sets out how that interest is calculated and recovered. This raises the financial risk for businesses receiving state aid in a legally uncertain situation.

Amendments to the Vehicle Operation Tax Law drafted by the Finance Ministry would require sole traders who use a personally registered car for commercial passenger transport to pay the company light-vehicle tax. It would apply only for the months the car was used for business. The change affects self-employed people in passenger transport.

Also reported by: plz.lv

The OECD's public consultation on a new chapter of the international Transfer Pricing Guidelines covering intra-group services closed this summer. The article summarises practitioners' concerns and suggestions for making the draft clearer, though it is not yet finalised. Useful for tax and transfer-pricing specialists at international corporate groups.

Also reported by: sorainen.com

An LV portāls e-consultation explains that a cash gift from a brother or half-brother (kinship within the third degree) is not subject to personal income tax unless it relates to the donor's business activity. The payment reference must state the reason for the transfer, and gifts above EUR 10,000 a year from one relative must be shown in the annual return as non-taxable income.

The State Revenue Service notes that from 1 November 2026 a new EU rule takes effect requiring a €2 handling fee per item in shipments from third countries. The change applies to goods bought through e-commerce platforms and online stores and will affect both businesses and consumers.

On 29 September 2026 the European Commission refused to extend Latvia's derogation from the VAT Directive that allows the reverse-charge VAT regime for timber; the current approval runs until 31 December 2026. The Finance Ministry has not yet published an amending bill, the length of transition periods is unknown, and the author expects no change from the start of 2027. Businesses should plan for the cash-flow effect, since calculated VAT will have to be paid into the budget and refunds may be delayed.

The Finance Ministry's updated list of low-tax or no-tax jurisdictions, effective 1 November, adds the Turks and Caicos Islands and removes Fiji, Panama, Samoa and Trinidad and Tobago, leaving eight countries and territories (BilancePLZ, paywalled, only the lead is visible).

An LV portāls explainer, prepared with specialists of the State Social Insurance Agency, compares compulsory social insurance contributions and coverage across tax regimes. It sets out which risks employees are insured against, the self-employed person's own duties, how contributions work under the micro-enterprise tax and how a royalty recipient chooses between registering an economic activity and having tax withheld by the payer. Worked examples and the notion of the average contribution wage are included.

The State Revenue Service explains that from 1 November 2026, under new EU rules, a handling fee of EUR 2 is payable for every item line in a parcel from non-EU countries. For parcels up to EUR 150 it comes on top of the fixed EUR 3 customs duty per line in force since 1 July and VAT; above EUR 150 it is added to the standard import duty rate. If the online shop operates under the IOSS scheme, everything can be paid at purchase, otherwise at customs clearance.

On 20.10.2026 the State Revenue Service added to its interpretations catalogue, under corporate income tax, a downloadable list of low-tax and no-tax countries and territories to be applied from 1 November 2026. The page itself does not describe the list, so companies dealing with counterparties in such jurisdictions need to check the attached document.

Also reported by: vestnesis.lv

From 1 November 2026 an updated list of low- or zero-tax countries and territories takes effect in Latvia. The Turks and Caicos Islands will be added, while Fiji, Panama, Samoa and Trinidad and Tobago will be removed; transactions with companies from countries still on the list remain subject to special tax scrutiny.

The State Revenue Service reports that a technical fault, which in some cases delayed the display of taxpayers' payments in the unified tax account, has been fixed. Data exchange between the State Treasury and the service is restored and the electronic declaration system now shows up-to-date information, including payments from previous days. The notice was published on 20.10.2026 and updated on 21.10.2026.

The article explains that under Latvian rules a deadline falling on a weekend is normally moved to the next business day, but this does not automatically apply to VAT OSS/IOSS return and payment deadlines under EU Directive 2006/112/EC. That leaves extra risk for businesses using the OSS/IOSS regime for cross-border sales.

A new interactive visualisation on the State Revenue Service website shows how companies are spread across taxpayer rating groups by region, city and municipality. The data reflect the rating in force from 1 August 2026, with companies assigned to an area by their registered legal address. The rating describes compliance with tax obligations (filings, deadlines, arrears, audit results), so the tool can help gauge the tax discipline of local businesses.

According to the State Revenue Service (VID), total tax debt in Latvia at the start of October, including current and suspended debts and extended repayment terms, reached €811.7 million — up 0.3% from a month earlier but down 0.5% since the start of the year. The figures illustrate the scale of debt collection VID and taxpayers are dealing with.

A book excerpt explains how an accountant decides whether a payment to an individual under a contract for services, as author's fee or as rent requires income tax withholding, social contributions and a report to the VID, depending on whether the recipient has registered an economic activity (BilancePLZ, paywalled, only the lead is visible).

The Saeima has conceptually backed amendments to the Law on Personal Income Tax aimed at simplifying tax administration and refining the rules, affecting both residents and businesses. One of the changes concerns how tax applies to customer loyalty programmes.

VID updated its guidance material on mandatory state social-insurance contributions for self-employed persons in 2026. It is a downloadable document forming part of VID's broader catalogue of guidance on contribution rules for different taxpayer categories. The update is a technical refresh rather than a new requirement.

Draft changes to Cabinet regulation No. 304, out for consultation until 28 October, would have the tax authority automatically submit an employee's salary-tax booklet to the income payer so the tax-free minimum applies on time.

Draft changes to Cabinet regulation No. 537, open for consultation until 27 October, would simplify taxpayer registration with the tax authority by dropping the need to submit contract copies and relying on data it already holds.

Cabinet regulation No. 608, in force since 13 October 2026, amends the accounting rules to modernise inventory procedures and expand remote-inventory options such as video walkthroughs or photographs.

On 15 October the Saeima adopted, as urgent, final-reading amendments to the Personal Income Tax Law introducing an investment-account regime for crypto-asset holdings (tax due only when withdrawals exceed deposits) and a one-off declaration mechanism for crypto-assets held on 31 December 2026 at EU-licensed providers or in self-custodied wallets. Declared assets are taxed at 10% of their market value on that date; declarations can be filed with the State Revenue Service from 1 April to 31 May 2027, with one correction allowed by 30 June 2027, and tax due by 23 July 2027.

Latvia's tax authority VID has renewed a cooperation agreement with the Healthcare Employers' Association aimed at reducing tax evasion and 'envelope wages' in the healthcare sector, which the agreement frames as a fairness-in-competition issue. VID will share tax-law changes and its enforcement practice with the association, which will pass this on to its members and remind them of payment deadlines. The agreement runs for an indefinite term from signature.

Amendments to the Micro-Enterprise Tax Law took effect on 15 October, introducing from 1 April 2027 a "starter micro-enterprise tax" at a 10% rate for individuals who provide services to other individuals, such as trainers or hairdressers. To use the regime, a person only needs to open a dedicated business-income account at a bank, without registering as a self-employed person with the tax authority (VID). The paying institution handles the remaining information exchange and tax remittance together with VID.

Parliament urgently adopted amendments on 15 October introducing an investment-account regime for crypto-assets, under which tax is due only once withdrawals exceed the amount invested, with a one-off 10% rate for declaring existing holdings.

The paywalled piece covers the CJEU's March 2026 ruling in case C-521/24, confirming that member states cannot use procedural requirements to deny a good-faith taxpayer's right to deduct input VAT just because invoices arrived late.

VID published an informational note on amendments to the accounting rules, available in its 'Organising accounting' section for businesses, as a downloadable document under changes to legislation. The publication targets companies that need to adapt their bookkeeping to the new requirements.

The article summarises discounts set by the Law on Real Estate Tax that apply across Latvia - including a 90% reduction for people with low-income status and 50% for large families and politically repressed persons - and notes that municipalities may grant further, larger discounts and add other eligible categories. It gives examples of discounts set by Riga, Daugavpils, Rēzekne and other city councils and how to apply for them.

The article looks at Senate Administrative Cases Department case law where the "turnover" figure reported on VAT returns gets used in ways that misrepresent its true legal meaning.

The tax authority explained amendments to the corporate income tax law that from 1 January 2027 align Latvia's tonnage-tax scheme with EU requirements so the regime can continue, with existing taxpayers moving to the new conditions from 2028.

The paywalled piece explains what documentation a company must prepare for related-party transactions to meet tax-law requirements.

VID published an informational note on amendments to the Corporate Income Tax Law that take effect on 1 January 2027, available as a downloadable document in its 'changes to legislation' section, meant to let taxpayers prepare ahead of time. The specific content of the amendments is contained only in the downloadable file, not summarised on the page itself.

The office of sworn advocate Lauris Klagišs has summarised upcoming personal income tax changes: gifts received from a spouse's first-degree relatives (such as a husband's parents) will now be exempt from income tax, removing a previous disparity between blood relatives and in-laws. Landlords renting out property under the 10% tax regime will no longer have to pay tax on utility-cost reimbursements passed on from tenants, as long as those payments create no additional income.

From 1 April 2027 the reduced patent fee will no longer be paid together with the micro-enterprise tax, under amendments to the personal income tax law adopted on 17 September 2026, and the tax authority has updated its guidance accordingly.

The article explains VAT Law rules on which tax period a transaction must be reported in - for domestic supplies, EU supplies, and acquisitions of goods or services from the EU or third countries. A late or missing invoice can trigger late-payment interest, so the author stresses getting the reporting moment right.

The Culture Ministry has proposed extending to 31 December 2030 the option for copyright-fee recipients to avoid registering as self-employed, keeping the arrangement where the payer withholds taxes (25% combined for income tax and social contributions). The current deadline is 31 December 2027; the proposal was submitted to the Saeima's Budget and Finance (Taxation) Committee ahead of the bill's second reading. The ministry says the change will not affect state budget revenue since it continues the existing procedure.

On 9 October the official gazette published amendments to the Corporate Income Tax Law that refine the tonnage-tax regime for maritime shipping, including new definitions of a qualifying sea transport vessel and conditions for vessel chartering and management contracts. The law was adopted by the Saeima on 1 October and takes effect 1 January 2027.

On 8 October the Saeima conceptually backed amendments to the Personal Income Tax Law that exempt loyalty-programme cashback from tax, widen the range of tax-free gifts, and simplify tax administration for declared economic-activity providers. It also plans to raise the tax-free compensation limit for volunteers from EUR 1,000 to EUR 3,000 a year.

On 8 October the Saeima backed urgent amendments applying the same tax treatment to crypto-assets as to shares and bonds — tax is due only when withdrawals from an investment account exceed the amount invested. A voluntary disclosure mechanism is also planned for previously undeclared crypto-assets held as of 31 December 2026.

On 8 October 2026 the Saeima gave conceptual support to amendments applying the same tax treatment to crypto-assets as currently used for investments in shares and bonds, meaning tax would be due only once withdrawals exceed the amount invested. Currently tax is charged on each individual crypto transaction.

The European Commission has objected to Latvia's request to again extend the special reverse-charge VAT regime for the timber sector, in place since 2004 and due to expire on 31 December 2026. The Commission notes that the regime - under which the buyer, not the seller, pays VAT on domestic timber supplies - has already been extended repeatedly over more than 20 years, and that Latvia's new request describes no new anti-fraud measures introduced since the last extension. The sector should therefore expect a return to the standard VAT procedure after this year if the Council follows the Commission's objection.

The State Revenue Service issued guidance explaining when individuals must pay VAT and personal income tax on transactions involving timber. The material aims to reduce uncertainty about how taxes apply in this area.

The State Revenue Service issued guidance on amendments to Cabinet Regulation No. 827 on reporting mandatory state social-insurance contributions, which took effect on 1 October 2026. The material explains the new registration and reporting requirements for contribution payers.

At its session No. 19 on 6 October 2026, the Public Benefit Commission recommended that VID grant public-benefit-organisation status, which carries tax relief, to the association "Dabas straume" and the foundation "JEWNITED ONE FAMILY," under Section 6(2) of the Public Benefit Organisations Law. The recommendation is not final - VID still must decide.

The European Commission rejected Latvia's request to again extend the reverse VAT charge for domestic timber supplies, under which the recipient rather than the supplier pays the tax. As a result, the special regime for the timber sector will not continue.

The Cabinet backed a Finance Ministry report ending the Public Benefit Commission, transferring the assessment of granting, monitoring and revoking public-benefit organisation (SLO) status entirely to the State Revenue Service (VID). The goal is to simplify and speed up SLO status administration after more than 20 years of the commission's work.

To speed up granting and overseeing public-benefit organisation status, the Public Benefit Commission is to be dissolved with its functions transferred to the State Revenue Service. The Finance Ministry's report on the change has been submitted to the Cabinet of Ministers.

An opinion piece in which multi-artist Horens Stalbe argues that the tax system remains too complex for many residents, and that responsibility for understanding it lies not only with individuals but also with state agencies' ability to explain the rules in plain language.

VID has published its monthly review of tax-related legal acts published in the official gazette Latvijas Vēstnesis during September 2026, structured as a table with each act's name, a comment, its adoption and entry-into-force dates, and the amendments made. The visible portion names amendments to the Law on Limiting the Rise in Oil Product Prices affecting excise duty application.

Since July 1, 2026 the EU has scrapped the tax exemption for low-value parcels, introducing a flat €3 customs fee per item for shipments under €150 from third countries. June saw over 710,000 customs declarations filed, dropping to nearly 525,000 in July — a roughly 25% decline; parcel volumes from Asia and the US initially fell by up to 70%, with a modest ~20% recovery from the low point seen in September.

Sorainen's September tax newsletter covers a new 10% 'starter microenterprise' tax regime effective 1 April 2027, amendments introducing an 'exit tax' for investment accounts and a voluntary crypto-asset disclosure regime at a 10% rate, plus EU customs reforms and shipping tonnage-tax changes from 2027.

The closing part of a series, based on the State Revenue Service's position, summarises how to correctly report transactions in the VAT return — VAT on goods supplied or services provided in Latvia must be declared for the period in which the tax invoice was issued, and a late invoice can trigger late-payment interest.

VID reports that, in connection with the emergency situation declared over summer and early autumn 2026 due to prolonged, intense rainfall (in force until 10 January 2027), affected farmers can access support to meet payment obligations. The full detail of the specific mechanism (a tax deadline extension or other measure) is only available on VID's site as a short, truncated preview, but the article is directly tied to the emergency situation in force from 1 October.

The European Commission has launched infringement proceedings against Latvia and several other states (Germany, Estonia, Lithuania, Hungary) over penalties for breaching administrative tax-cooperation rules that the Commission considers too weak to deter aggressive cross-border tax planning by multinational groups. The countries have two months to respond and strengthen their penalty frameworks, or face further escalation, potentially up to the EU Court of Justice with financial penalties.

In a "Jumis Pro" survey of 176 Latvian businesses, 64.8% want the newly elected Saeima to further cut labour taxes, seeing this as key to competitiveness. While raising the tax-exempt minimum is seen as a step forward, business leaders remain skeptical about further concrete implementation; lower labour costs are viewed as critical for attracting foreign investment.

The State Revenue Service issued a clarification on the legal aspects of determining goods' origin and applying customs legislation, using an example where a Latvian plant combines Chinese raw material with an EU-origin component to make a finished product. It explains how the customs origin status is determined in such cases.

From April 1, 2027, residents informally selling flowers, mushrooms or homemade goods will be able to opt into a special tax regime — an automatic 10% withholding instead of the standard 25% micro-enterprise tax — if annual turnover doesn't exceed €12,000. The government projects about €2.5 million in budget revenue, against implementation costs of €341,510; small sellers surveyed showed little enthusiasm for the new scheme.

A 22-year-old named Pauls, who studied in the US on a scholarship, became a Latvian tax resident after joining mandatory National Defence Service. The State Revenue Service (VID) ruled he owes about €3,000 in personal income tax on the US scholarship because it isn't on the list of tax-exempt stipends. VID says Latvian residents must pay tax on foreign income regardless of US tax treatment; Pauls plans to appeal, and the Defence Ministry says it is willing to review the relevant rules.

VID reminds taxpayers that until September 30 they can apply for an automatic refund of overpaid personal income tax without filing a full annual declaration. This option suits people with no documented expenses to attach to a return; those who miss the deadline and want a refund for eligible expenses (e.g. medical or education costs) must file a complete annual declaration.

The State Revenue Service updated its methodological guidance for payers of the company passenger-vehicle tax, clarifying input-VAT deduction restrictions on buying, leasing and maintaining passenger cars. It specifies when input VAT on such costs cannot be fully deducted.

On TV24, University of Latvia rector and economist Gundars Bērziņš said that in the coming years Latvia will need to find a way to fund defence spending while keeping limited fiscal space, and that one possible, publicly unpopular solution could be raising taxes if government spending cannot be cut enough.

Estonian outlet "Postimees" writes that Latvia's decision to cut fuel excise duty for three months could create a significant price gap between the two countries' filling stations, since Latvia's VAT rate is also lower. However, the resulting demand for cheaper fuel is expected to affect mainly freight trucks rather than a flow of private drivers from Estonia.

The State Revenue Service (VID) reminds residents who want a refund of overpaid personal income tax without filing an annual income declaration that they can submit an application for an automatic tax refund to VID by 30 September.

In an urgent two-reading procedure the Saeima adopted amendments that, from 1 October to the end of the year, cut the diesel excise rate from €396 to €330 per 1,000 litres — the EU-allowed minimum — while setting, for the first time, a temporary excise rate of €490 per 1,000 litres for unleaded petrol. The change is expected to reduce core state budget revenue by about €14.4 million.

The Saeima is reviewing amendments to the Personal Income Tax Law clarifying how investment accounts are taxed when a person's tax residency changes. Experts say the changes could mainly affect holders of foreign investment accounts.

On 17 September the Saeima approved in final reading amendments to the Micro-Enterprise Tax Law aimed at reducing the administrative burden on residents with small side incomes, such as private tutors and craftspeople.

The paywalled article, continuing the topic of a self-employed person's social insurance contributions, explains that they are calculated from economic-activity income and need not be paid in a month with no income.

On 17 September the Saeima adopted in final reading amendments to the Micro-Enterprise Tax Law aimed at cutting administrative burden, which could benefit handymen, private tutors, coaches, nannies, beauticians, gardeners and other residents with side income, who will now be able to pay just 10% of their earnings.

VID's Public Benefit Commission, at a regular session, backed granting public-benefit status to several associations and foundations, which entitles them to tax relief and lets donor companies claim corporate income tax deductions.

From 1 October until year-end, the excise duty on diesel drops from EUR 396 to EUR 330 per 1,000 litres, while unleaded petrol gets a temporary rate of EUR 490 per 1,000 litres; the mandatory biofuel-blending requirement is also lifted for marked agricultural diesel and military fuel.

The Budget and Finance Committee backed a proposal to tax crypto-assets the same way as stock and bond investments - tax due only when withdrawals exceed amounts invested. It also envisages a one-off voluntary declaration of holdings as of 31 December 2026 at a flat 10% rate, with penalty protection for those not already under investigation; the amendments still need three readings.

Also reported by: ifinanses.lv

The Saeima's Budget and Finance Committee gave conceptual backing to Personal Income Tax Law amendments that would exempt loyalty-programme cashback from tax, widen tax-free gift categories, raise the tax-exempt volunteer-compensation ceiling from €1,000 to €3,000 a year, and ease self-employed persons' reporting of utility payments collected on behalf of third parties. The proposal still needs three Saeima readings.

VID reports that on 18 September 2026 the EU Official Journal published Commission Implementing Regulation (EU) 2026/2133, setting provisional trade-defence measures on imports of grain-oriented electrical steel flat-rolled products. The regulation applies directly, and importers must observe its duties and payment obligations when declaring the goods.

On 17 September the Saeima adopted, in third reading, amendments to the micro-business tax regime that cut the rate from 25% to 10% for annual income above EUR 12,000. The author notes the change partly answers complaints from micro-business owners about the excessive rate, though registration with the tax authority remains cumbersome. The amendments still require official publication before taking effect.

The paywalled article explains whether and when VAT must be paid on a transaction whose actual occurrence the tax authority has questioned during an audit.

Amendments have been submitted to the Personal Income Tax Law that would widen the circle of tax-exempt gifts, including between spouses and relatives, and raise the tax-free cap on volunteer compensation from EUR 1,000 to EUR 3,000 a year; the amendments still need three Saeima readings.

Over the first eight months of the year the consolidated budget shows an almost €128 million surplus versus a deficit a year earlier, but this is mainly due to faster growth in EU fund payments rather than higher tax collection alone. Taxes collected are up 6% year-on-year, yet nearly €96 million short of plan, partly because of lower excise revenue after the diesel excise rate cut.

The State Revenue Service (VID) published methodological guidelines for filling in the controlled-transactions report in the transfer-pricing area, explaining to corporate income tax payers how the tax applies to related-party transactions. The material is available in VID's "Informative and methodological materials" section.

The Finance Ministry has submitted for approval a report proposing to transfer the evaluation functions currently performed by the Public Benefit Commission to the State Revenue Service (VID), simplifying and speeding up the process of granting, supervising and withdrawing public-benefit organisation (SLO) status. VID already prepares and issues final decisions on SLO status, so dropping the commission's advisory step would concentrate the evaluation in one institution; further legislative amendments are needed to implement it.

Saeima passed in final reading amendments to the Micro-enterprise Tax Law introducing a simplified regime for individuals who provide services or sell goods to other individuals on a small scale (up to €12,000 annual turnover). They will be able to pay a 10% tax on turnover via a dedicated income account, with the tax authority automating most calculations and declarations. The new rules take effect on 1 April 2027.

On 17 September 2026, the Saeima adopted in final reading amendments to the Microenterprise Tax Law allowing individuals with annual turnover up to EUR 12,000 who serve only other individuals to pay a 10% micro-tax via their economic-activity income account.

The paywalled article answers a reader's question on whether, in a one-employee company, gym membership costs can qualify as tax-exempt personnel sustainability event expenses.

The State Revenue Service reminds residents who want a refund of overpaid personal income tax without filing an annual income declaration that they can submit an application for automatic tax refund by 30 September this year.

The State Revenue Service reminds residents they can claim an automatic refund of overpaid personal income tax without filing a full annual return — for example where the overpayment stems from unused allowances or private pension contributions — by applying before 30 September, with money paid out between 1 October and 31 December. Reclaiming tax on healthcare, education or other deductible expenses still requires filing a full annual return with supporting documents.

Based on a reader's case, the paywalled article explains what to do if the State Revenue Service classifies a person's transaction as economic activity and demands VAT payment, even though the person disagrees with that assessment.

The paywalled article, following an SRS clarification, explains the deadline from the moment of a transaction by which a VAT invoice must be issued.

The paywalled article answers a reader's question on whether the State Revenue Service, when issuing an outsourced accountant's licence, assesses the qualification obtained or the study programme content.

The article describes proposed amendments to Latvia's Corporate Income Tax Law adding new paragraphs 9 and 10 to Article 15, introducing counter-corrections for cross-border related-party transactions. The rules in force since 2018 allow only transfer-pricing corrections that increase the Latvian taxable base; the new mechanism would let a foreign related party voluntarily increase its own base, directly relieving double taxation without the previous procedure under tax treaties' Article 25 or the EU Arbitration Convention, which typically took 2-3 years.

Also reported by: ifinanses.lv

LV portāls explains cash-transaction limits for individuals under the Law on Taxes and Duties. Transactions above €7,200 must use non-cash payment and cannot be split into smaller cash payments to bypass the limit; real estate deals may not use cash at all, regardless of amount. A State Revenue Service (VID) official notes the rule applies regardless of the counterparty's status.

LSM.lv reports that the Saeima's Budget and Finance Committee advanced to final reading a plan for a new "starter micro-business tax" of 10% of revenue for people earning small side income, e.g. from private lessons or minor repairs. A person would open a business-income account from which the tax is withheld automatically, with VID informed without a separate declaration. The aim is to encourage legalizing currently unregistered side income.

The Competition Council found that Latvia's three largest food retail chains — Rimi Latvia, Maxima Latvija and Lidl Latvija — largely passed on in full the planned 7.4% price cut following introduction of the reduced 12% VAT rate on milk, bread, eggs and poultry. The actual average price drop reached 8.32%, exceeding the target in several categories. The Council will continue monitoring through year-end and publish final results in January 2027.

BB.LV reports that Latvia's Competition Council checked the three largest retail chains — Rimi, Maxima and Lidl — after VAT was cut on bread, milk, eggs and poultry. Its preliminary finding: the largest grocery chains mostly passed the full VAT-cut effect on to consumers, with average prices falling even more than expected.

The Ministry of Finance has prepared amendments to the Corporate Income Tax Law which, after public consultation, have been submitted for inter-institutional coordination. They would widen the definition of dividends (liquidation quota, consideration for share buy-backs), introduce a mechanism for corresponding transfer pricing adjustments, set the time for paying deferred CIT on deemed dividends in a reorganisation, exclude employee share plans from the calculation of reductions in equity and relax the conditions for deducting interest payments by applying a net interest calculation. The rules are also aligned with the amendments to the Social Enterprise Law that enter into force on 1 January 2027.

The Ministry of Finance has prepared amendments to the Corporate Income Tax Law to clarify the rules and prevent double taxation. The definition of dividends is widened (to include the liquidation quota and consideration for share buy-backs), a transfer pricing adjustment mechanism is introduced that allows the taxable base to be reduced where a related party's income has been adjusted, the rules on deferred payment for deemed dividends in reorganisations and the conditions for deducting interest are clarified, as are the provisions on employee share programmes and social enterprises. The public consultation has closed and the draft has been submitted for coordination.

Leinonen Latvia explains how personal income tax (PIT) applies to capital gains from disposing of securities (shares, equity interests, investment-fund certificates, debt instruments), with the gain calculated as disposal price minus acquisition value and holding-period investments. Transactions started before end-2025 and reported to the State Revenue Service get a 20% transitional rate through 2027, while transactions from 1 January 2025 face a 25.5% rate, plus a further 3% once total annual income exceeds EUR 200,000. Contributing securities to a company's share capital in exchange for shares defers the tax until those new shares are later disposed of.

The article explains how taxes apply when an employer buys an employee both a standard health-insurance policy and a so-called "open" policy, and whether the premiums paid for the employee must be added together when calculating the tax-exempt threshold.

The publisher has expanded its transfer-pricing documentation guides, at both local and global level, to help companies meet the new requirements for preparing transfer-pricing documentation, including filing a controlled-transactions report.

VID reports that Commission Implementing Regulation (EU) 2026/1963, published 31 August in the EU Official Journal, sets out the evidence importers must provide on steel products' "melt and pour" country of origin; it entered into force on 1 September and applies from 1 October. The requirement supplements the EU's Steel Regulation 2026/1384, which sets tariff quotas of 18,345,922 tonnes and a 50% out-of-quota duty across 26 product categories.

VID reminds taxpayers that payments for children's extracurricular clubs and classes — whether run by education institutions or other municipally licensed providers — qualify for a personal-income-tax refund via the annual income declaration, accompanied by proof of payment. Supporting documents must state the child's name and personal ID code and the type of service received.

Also reported by: ifinanses.lv

Tax consultant Karlīna Stāmere explains the application of VAT when a distributor hands goods over to a retailer for sale while retaining ownership (consignment). Referring to the State Revenue Service's binding ruling No. P005-17/8.6.4/17726 of 1 April 2026, it is noted that handing over goods with an accompanying document stating the possible selling price is not a VAT-taxable transaction – no tax is to be calculated at the time of handover and the retailer does not deduct input tax. The article is paywalled.

Sorainen's tax news review (I. Zladeja, A. Lasmane, K. Erele, E. Hercenbergs, J. Taukačs). The Saeima has approved changes to the simplified tax regime for small-scale economic activity: the revenue threshold is lowered from EUR 25,000 to EUR 12,000, a 10% "starter" micro-enterprise tax rate is introduced, withheld automatically by the credit institution, with an additional 15% for non-compliance. Amendments to the Personal Income Tax Law have been submitted on eligible expenses for physician-prescribed medical devices (from 31 December 2026), along with clarifications of excise/natural gas trader status. The State Revenue Service's methodology clarifies that a permanent establishment's reporting period may not exceed 12 months and that ordering by QR code in a restaurant is not distance selling. The review also covers commentary on the OECD transfer pricing guidelines, EPPO searches at two Latvian hospitals (procurements worth EUR 657,000) and tax news from Lithuania and Poland.

The Saeima's Budget and Finance (Taxation) Committee is considering for the third reading amendments to the Micro-enterprise Tax Law introducing a simplified tax payment procedure for natural persons who provide services or sell goods only to other natural persons with annual turnover of up to EUR 12,000 (coaches, gardeners, private tutors, hairdressers, etc.). A "starter" micro-enterprise tax rate of 10% of turnover is envisaged, with registration at a bank by opening an economic activity income account and no bookkeeping obligation; the conditions are no registered economic activity in the last two tax periods, no employees, and all revenue passing through the account. Breaches carry an additional 15% surcharge and a ban on using the regime for two periods. Entry into force is planned for 1 April 2027; around 1,000 users and EUR 2.5 million a year for the budgets are forecast.

VID has published a new customs ruling in its explanations catalogue on how to determine a good's country of origin, aimed at helping importers and exporters resolve practical classification and origin questions.

An explanation of the obligation to register economic activity under Section 11 of the Law on Personal Income Tax: the indicators are regularity of transactions (three or more transactions a year, or five in three years), income from a transaction above EUR 14,229, or the economic substance of the activity. Two regimes are described – the general regime (PIT of 25.5% up to EUR 105,300 and 33% above; social insurance contributions of 31.07%, or 10% if monthly profit is below EUR 780) and the micro-enterprise tax (25% of turnover with no deduction of expenses). The 2026 thresholds are given: non-taxable minimum of EUR 6,600 a year, VAT registration threshold of EUR 50,000, minimum PIT of EUR 50; registration must be done before starting the activity, including for platform income (DAC7).

VID's roundup of tax-related acts published in Latvijas Vēstnesis in August lists four notable Cabinet regulations: No. 428 on VID's state information systems (effective 5 August), No. 464 refining business-trip expense reimbursement (effective 18 August), No. 499 amending the natural-resources-tax exemption rules to align with the EU battery regulation (effective 1 September), and No. 509 banning imports of certain industrial goods from Russia and Belarus (effective 1 September).

Also reported by: ifinanses.lv

VID has updated its methodological guidance on completing the electricity tax declaration, giving taxpayers current instructions for preparing the return.

Cabinet of Ministers Regulation No. 499 of 25 August, published on 31 August and in force from 1 September, amends the procedure for obtaining exemption from natural resources tax on environmentally harmful goods. Waste management operators and their cooperation partners must be registered in the relevant producer registers (electrical equipment, batteries), the reporting deadline is moved from 31 March to 31 August (for the period from 1 January to 30 June), and authority action is provided for where the 40% collection target is not met; a more detailed reporting section on battery recycling applies from 2027–2028.

The article covers several amendments moving through the Saeima to the microenterprise tax, personal income tax and taxes-and-fees laws, drafted by MPs from various parties ahead of elections. It notes that last year 10,800 microenterprise filers fell short of the €25,000 turnover threshold.

Under a new Article 25.2 of the Customs Law, from 1 July 2027 only persons registered in a newly created register will be allowed to provide customs representation services in Latvia. The State Revenue Service informs businesses planning to continue this activity about the upcoming registration requirement.

Cabinet-approved amendments to the Personal Income Tax Law clarify that mandatory social insurance contributions a self-employed person pays for themselves may not be counted as business expenses.

Amendments will add a new paragraph to Section 6 of the Personal Income Tax Law requiring tax-relief information to be filed before the annual declaration, otherwise processing is delayed.

Latvia's State Revenue Service (VID) issued an opinion on how often VAT invoices must be issued for long-term services, such as a 12-month lease of land or hunting rights. VID concluded that a single invoice for the whole period is permissible if the transaction meets the conditions of Section 32(4) of the VAT Law — a service not received from another state, with no interim invoices or payments during the period. Otherwise more frequent invoicing is required to avoid late tax payment and default charges.

Draft amendments to the Personal Income Tax Law will add a definition of the wage tax booklet to Section 6 and specify who receives it; the Cabinet has approved the amendments, which still require Saeima adoption.

The government on Tuesday backed Finance Ministry amendments to the personal income tax law clarifying unregulated situations and cutting red tape. The key change raises the tax-free expense compensation cap for volunteers and religious-organisation staff from €1,000 to €3,000 a year, introducing a single compensation rate.

State Revenue Service data show Latvia's total tax arrears fell to €815.593 million as of 1 August 2026, down 1% from July. State budget debts stood at €339.521 million, municipal debts at €298.4 million, and social insurance debts at €177.672 million; €224.797 million of the total is suspended debt from insolvent companies, while €85.203 million has extended payment terms.

The Cabinet approved Finance Ministry amendments to the Personal Income Tax Law. Key changes raise the tax-exempt ceiling for volunteer and clergy expense reimbursements from 1,000 to 3,000 euros a year, exempt loyalty-programme cashback from tax, and widen tax-free gifts between relatives. The re-election period for the reduced patent tax is also shortened from five to two years.

The article lists common VAT errors made by Latvian businesses: over-deducting input tax on costs subject to statutory limits (business lunches, events, company cars), miscalculating the proportion in mixed taxable/non-taxable transactions, late VAT reporting, and incorrectly applying the reverse-charge mechanism. It also recaps Latvia's VAT rates, including the 12% rate for certain goods.

The article describes a Finance Ministry package of amendments to the personal income tax law, due before the government on 25 August. One change requires a dependant's declared residence to be in Latvia, another EU or EEA country, effectively excluding the dependant tax relief for those living in Russia.

The tax authority clarified that under simplified bookkeeping, payments such as PayPal should be recognised when funds reach the platform account, while Stripe-type receipts count on arrival in the bank account, and platform commissions must be documented.

The answer explains that people who have reached pension age, including farm owners outside employment relationships, are in certain cases exempt from mandatory state social insurance contributions. The exact rule depends on the person's status and type of economic activity.

The answer confirms that a self-employed person registered in Latvia may carry out economic activity abroad too, including invoicing foreign clients, while keeping self-employed status. Further details are on the State Revenue Service website.

The Latvian Traders' Association (LAT) is urging the Finance Ministry to treat losses linked to international sanctions as force majeure, allowing suppliers to write them off as business expenses without triggering corporate income tax. If suppliers must write off roughly EUR 1.8 million in unpaid goods as bad debt, current rules could impose an additional tax of about 25% on the uncovered amount. LAT president Henriks Danusevics says that without changes, suppliers lose not only the debt itself but also pay tax on it.

The subscriber-only article explains that since 1 July 2026, parcels from third countries worth up to 150 euros are subject to a simplified customs duty of 3 euros per product category, a rule that will remain in force until 1 July 2028.

The subscriber-only article explains when an employer-paid gym membership or other fringe benefit for an employee becomes income subject to personal income tax or corporate income tax.

The piece explains that the tax authority VID does not treat a loan between private individuals as income and does not require it to be reported if the money is repaid. Loans up to 1,500 euros from one lender, and loans between spouses or relatives up to the third degree, are not treated as income regardless of amount. VID stresses that the payment purpose must state its real nature — a loan or its repayment.