Both before and during the Covid-19 crisis, some companies have been providing their employees with free meals and transport between home and work for the sake of business continuity. This article explores the VAT implications of this practice.
Many multinational enterprises have suffered losses from a drop in demand, a supply chain delay or extraordinary operating costs during the period of Covid-19 restrictions. The allocation of such losses and extraordinary costs between related companies is likely to attract the tax authority’s scrutiny so these issues require special attention. This article explores the allocation of losses and Covid-19 specific costs in the light of the OECD’s Guidance on the transfer pricing implications of the Covid-19 pandemic.
Making a false claim or providing insufficient information can be recognised as an unfair commercial practice. This article explores some common mistakes made by persons selling goods or providing services (“sellers”) that are recognised as unfair commercial practices by the Consumer Rights Protection Centre (the “Regulator”).
To mitigate the adverse effects of the Covid-19 pandemic, amendments to the Covid-19 Act were adopted by Parliament on 18 March and came into force on 20 March 2021. This article explores changes in how individuals file their annual income tax return and how taxes are calculated.
Employee stock option plans are gaining traction as a tool for motivating employees in Latvia. Employees elsewhere in the world have for years been able to become company shareholders, which has boosted their contribution to their company and its growth. The grant of employee shares or stock options is essentially a type of employee compensation linked to the company’s development (profitability).
The principle of penalty individualisation applies in tax law, too. Even if a taxpayer has broken the law the tax authority is permitted by law to treat the taxpayer leniently and charge half a penalty if he meets certain conditions. This article explores what conditions the latest case law says the tax authority should assess to establish that the taxpayer has filed returns and paid taxes on time.
We have spent the last year or so coming to terms with the Covid-19 pandemic, which has changed our daily lives beyond recognition. While we keep thinking mainly about the restrictions and outbreak statistics, it would be useful to figure out whether companies are now subject to a heightened risk of money laundering and terrorism and proliferation financing (“ML/TPF”) and whether the internal control systems set up by persons subject to the Anti Money Laundering and Counter Terrorism and Proliferation Financing Act are still as effective as they were before the pandemic.
The Covid-19 pandemic has undeniably caused an economic downturn that has dealt a nasty blow not only to the European and global economy but to each company and its employees. So it makes sense that the new EU funding period, launched amid a global pandemic, aims to help minimise the adverse effects of Covid-19 in the distant future as well. Most of the funding (e.g. Cohesion Policy programmes) available to the member states during the new planning period are familiar but there are also some new programmes. Each programme focuses on achieving the goals of a greener and smarter Europe.
A non-resident company that allocates various expenses to its permanent establishment (“PE”) in Latvia might wonder whether the PE can fully deduct all those expenses for corporate income tax (“CIT”) purposes. This article explores the non-resident’s staff cost allocations to the PE.
Acting on requests from customers and readers to identify and interpret persons that are subject to the Anti Money Laundering and Counter Terrorism and Proliferation Financing Act, we approached the State Revenue Service for some practical insights into non-standard and complex corporate structures and their business activities in order to gain a broader understanding of how the Act should be applied. We have now summarised the information and reached conclusions, so here are the answers!
While some taxpayers may face challenges in applying their advance pricing agreements (“APAs”) with the tax authorities under the economic conditions resulting from the pandemic, all existing APAs and their terms should be respected unless a critical assumption is breached. This article provides an overview of how COVID-19 affects APAs in the light of the OECD’s “Guidance on the transfer pricing implications of the COVID-19 pandemic.”
For an ever-decreasing number of businesses, financial return remains the top priority. For others, whether driven by investor demand, regulation or the desire to enhance societal value, there is now an expectation that organisations make environmental, social and governance (ESG) issues and sustainability integral to their corporate strategy, philosophy and reporting. Where does your business lie on the spectrum?
If a stock option awarded to an employee does not meet the criteria for the tax favoured treatment and is consequently taxable at vesting, the Latvian employer is liable to report the award for personal income tax (PIT) and national social insurance contributions (NSIC) purposes and ensure taxes are paid.
PwC provides general information about –
1. why tax resident status is important and how it is determined;
2. when you are liable to file a Latvian annual income tax return and when you can do so voluntarily;
3. social security arrangements.