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.
As you may know, Latvian taxable persons can recover VAT paid on purchases in another member state under Council Directive 2008/9/EC, i.e. local VAT is refunded to taxable persons that are not established in the member state but are established in another. As Britain left the EU on 31 January 2020 with a period of transition to 31 December 2020, the single EU VAT refund procedure is no longer available to recover UK VAT after 1 January 2021. The single procedure can still be used to recover any UK VAT paid in 2020, but the filing deadline is almost upon us: 31 March 2021.
When it comes to approving an action plan for a debtor’s legal protection proceedings, it is important to know which of its creditors can vote and to properly interpret the rules that place voting restrictions on certain persons. The insights outlined in this article can help companies in financial distress, creditor representatives and supervisors of legal protection proceedings find out whether only voting creditors have approved an action plan or whether the vote includes any person ineligible to vote.
The United Kingdom (“UK”) left the EU at midnight on 31 January 2020. The Brexit agreement provided that EU nationals staying in the UK until the end of the transition period would keep the social rights that go with EU citizen status, i.e. the opportunity to apply for various benefits, pensions and other social entitlements in the UK, similar to living in other member states. The Trade and Cooperation Agreement signed on 30 December 2020 is applied provisionally from 1 January 2021 pending ratification at EU level. The Agreement includes a separate protocol on social security coordination. This article explores some key changes in social security to be considered by employers after Brexit and in the light of the new agreement.
Information published by the Latvian State Revenue Service (“SRS”) on sanctions they have imposed on persons that are subject to the Anti Money Laundering and Counter Terrorism and Proliferation Financing (“AML/CTPF”) Act for breaching this Act and the International and National Sanctions Act, with data for 2020 and 2021, shows a large number of breaches and a lack of awareness of what the two Acts require and whether a company fits the definition of “subject” within the meaning of the AML/CTPF Act.
When employees are sent on business trips abroad, various online platforms are increasingly used for booking the necessary accommodation and transport services. A variety of other goods and services are also being ordered online from foreign vendors. Any documents received often fail to make it clear whether VAT has been charged on the supply and who is the other party (the platform or its customer). This article explores a few models commonly found across the EU from the buyer’s point of view.
Last year the State Revenue Service (“SRS”) for the first time analysed data supplied by the Latvian banks to find income unreported by Latvian residents. Many taxpayers had a letter from the SRS asking them to explain why their bank income details do not match their tax filings. This article explores how the SRS runs taxpayer checks and what response is advisable.
Alternative legal solutions are an efficient tool that helps companies balance unpredictable workflows and staff turnover and enables their legal department to work well, while cutting total costs and keeping their staff happy with their workload, pay, and growth opportunities. These solutions are no longer a proof of concept or a brand new business model. They have been tried and tested, work successfully worldwide, including Latvia, and are used by companies of different sizes.
This year has passed under the sign of Covid-19, with the pandemic overshadowing one crucial event it’s high time we remembered: Britain leaving the EU. This article explores key changes to how UK citizens can be employed in Latvia after Brexit.
Recent years have seen new players rapidly entering the financial services market: FinTech companies. The name itself suggests that these companies are operating where financial services meet technology. FinTech companies are promoting and developing the banking business and are themselves becoming an alternative to traditional banking. This article explores some key VAT issues facing FinTech companies.
On 17 November the Supreme Court dismissed an appeal by the State Revenue Service (“SRS”) against the Regional Court’s ruling that had granted a petition for overturning the SRS’s decision.
On 6 November an emergency situation was again announced in Latvia, with a number of restrictions significantly affecting taxpayers’ business. The current state aid mechanism has been devised according to the guidelines adopted in the spring, but there are a number of differences we should consider to understand what aid measures are available to taxpayers this time round.
Globalisation is seeing a constant increase in cross-border business, something that encourages entrepreneurs to look for a suitable corporate structure within and outside their base country. Choosing a particular structure is often based not only on business interests in a certain market but also on favourable administrative and tax rules.
An adverse economic environment poses certain difficulties in maintaining transfer pricing (“TP”) policies. However, a global economic crisis does not cancel the requirement that controlled transactions be arm’s length. Following our article on Covid-19 and financial transactions, this one explores some other implications of the pandemic for TP outcomes and provides suggestions for TP analysis.
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.