Adjusting invoices for reverse charge supplies and recovering VAT after tax audit (2/31/20) (0)

31.07.2020

Practice

On 2 July 2020, the Court of Justice of the European Union (“CJEU”) ruled on case C-835/18 (SC Terracult SRL). The dispute was over the tax authority’s refusal to allow a taxable person to adjust invoices after the tax authority had completed a tax audit and assessed an additional tax liability, thus denying the taxable person’s right to a tax refund. The tax authority’s decision was final because the taxable person had accepted it. The taxable person sought to adjust invoices on the basis of new facts which were not known when the tax authority made the decision and which resulted in reverse-charge VAT being applied to the underlying transactions. Read more..

Aspects of identifying status of politically exposed person (2) (3/31/20) (0)

31.07.2020

Practice

The topic continued from MindLink.lv news 24.07.2020. Based on EU and Latvian legislation, in 2019 the Financial Intelligence Unit drew up guidelines, describing methods for identifying politically exposed persons (“PEPs”). Read more..

Aspects of identifying status of politically exposed person (1) (3/30/20) (0)

24.07.2020

Practice

Although the Anti Money Laundering and Counter Terrorism and Proliferation Financing (“AML/CTPF”) Act has been in force for more than ten years, some of the entities governed by the Act still find it difficult to identify the status of a “politically exposed person.” Read more..

Hallmarks of reportable cross-border arrangements in transfer pricing (1/29/20) (0)

17.07.2020

Practice

The Cabinet of Ministers’ Regulation No. 210 on the automatic exchange of information on reportable cross-border arrangements came into force on 1 July 2020. The new rules basically require providers of tax, legal and any other type of consulting services who meet the criteria laid down by paragraph 3.5 of the rules, to provide the tax authority with information on any designed, marketed, organised or made available for implementation or manages the implementation a cross-border arrangement between a taxpayer registered in Latvia and a taxpayer registered in another tax jurisdiction known to them. In this article, we explore the hallmarks of cross-border arrangements for transfer pricing purposes and make recommendations that can help taxpayers making cross-border related-party transactions to objectively support their economic substance and avoid concerns about implementing them for aggressive tax planning and profit shifting purposes. Read more..

Corporate income tax treatment of security deposits (2/29/20) (0)

17.07.2020

Practice

The Corporate Income Tax (“CIT”) Act prescribes a 12-month time limit, within which a prepayment does not become a deemed profit distribution. This article explores whether the landlord’s tax base should include a security deposit that was received when entering into a tenancy agreement and will be refunded at the end of the tenancy. Read more..