In today’s fast-changing employment space, the status of workers has become a subject for legal, social and economic debate. Recent years have seen significant changes to the labour market and to the traditional perceptions of employment, in particular as a result of Covid-19.
On 7 December 2023 Parliament passed amendments to the Personal Income Tax (PIT) Act in their second – final – reading. As part of the 2024 budget bills package, these amendments were debated as a matter of urgency, with two readings only. This article explores what we see as key changes, including new products added to the basket of allowable expenses, compensation for remote work, and other exempt income groups that will have their exemption thresholds increased from next year.
The autumn months have been prolific with tax changes, yet some of the tax aspects, including temporary ones, might remain unchanged. The Finance Ministry has proposed many amendments to the Personal Income Tax (PIT) Act, including an extension of the special tax scheme for royalty recipients who are not registered as economic operators. This article explores the proposed extension of the transitional royalty scheme and how this will affect its users.
Under the Civil Code, a gift is a legal transaction whereby someone gives an asset to another person for free out of generosity. While a gift is mainly associated with something pleasant, there may be risks and questions – read on to find out more.
Following the UN Framework Convention on Climate Change, aka the Paris Agreement, the European Parliament signed the resolution on the European Green Deal on 15 January 2020 and urged the member states to carry out the required transition to a climate-neutral society by 2050 at the latest. The Green Deal involves making a variety of important changes. One of such changes is Regulation (EU) 2023/851 of the European Parliament and of the Council of 19 April 2023 amending Regulation (EU) 2019/631 as regards strengthening the CO2 emission performance standards for new passenger cars and new light commercial vehicles in line with the Union’s increased climate ambition. What this Regulation provides for is nothing new in substance, as CO2 emission requirements for vehicles have been adopted earlier, but it does introduce some fairly ambitious goals. This article explores some of its requirements.
To pick up where we left off last week about the Finance Ministry’s proposals for amending the Personal Income Tax (PIT) Act, this article looks at the proposed procedures for computing, reporting and paying PIT.
The end of September has been productive for farmers and ministries alike. The Ministry of Finance (MOF) has come up with proposals for amending the Personal Income Tax (PIT) Act, packaged into two bills. In this article we look at new additions to the basket of allowable expenses, as well as discussing remote work compensations and other classes of exempt income with an increased exemption threshold provisionally coming into force on 1 January 2024.
A proper analysis of workforce data can transform how organisations make decisions and optimise their resources. This has become crucial for today’s talent management, staff engagement, performance management and productivity purposes. In our earlier articles we looked at the significance of adopting human resource (HR) technologies to conduct a proper analysis of HR data and use it for business purposes. In this article we will explore various categories of workforce data that companies can gather in-house. Analysing the accumulated data will help you obtain an idea of what is working and what needs improving, allowing you to identify issues and come up with solutions faster, while revising and improving your processes.
A while ago Riga Regional Court passed Ruling CA-1102-22/7, which deals with a former employee’s right to recover outstanding wages from the employer for a period of posting and how to apply the concept of daily allowance and exercise the resulting right to include it in the worker’s hourly rate. Given the common practice of paying daily allowances to workers, in this article we will look at how this ruling defines the court’s vision for paying a legally reasonable daily allowance and making it part of the total remuneration.
By a unilateral decision, Russia has indefinitely suspended certain clauses of its double tax treaties (DTTs) with 38 countries from 8 August 2023. This article examines the list of affected countries and the status of Latvia’s DTT.
The current economic challenges, such as high inflation, scarce resources and pressures to increase profitability, continue pushing businesses towards a global dilemma: either motivate your workers to stay on with a pay rise and then say goodbye to your profit, or cancel your plans for higher pay and perks and then lose skilled workers. This dilemma might have you looking for some more efficient types of employer’s financial support with a low or no tax burden, such as non-taxable fringe benefits. This article offers an overview of exempt fringes and other useful tools employers can use to support their workers in the Baltic States.
The world has changed magnificently over the last 100 years as technological progress and democratic principles have made society more open-minded, tolerant and equal. As these things move forward, there are still social challenges that need to be taken care of. The gender gap remains a relatively stable phenomenon to this day, even though females have gained equal rights with males. In 2010, social entrepreneurs established The EQUAL-SALARY Foundation, a non-profit organisation, to fight for pay equity around the world. In words that are easy to understand, the Foundation presents data from the International Labour Organisation’s Global Wage Report 2018/2019, which states that globally women are paid 20% less than men on average. In the light of publication of the EQUAL-SALARY Foundation’s annual report, we summarise key takeaways.
The rapid evolution on a global scale leads to changes in all areas of life. What was once seen as something new and innovative has now become a standard, or it’s out of date already and in for a change. The evolving business environment entails changes to the workplace and workers’ needs, which means new challenges for employers. Diversity of benefits available to employees is becoming a key factor in assessing the workplace. According to statistics, activities promoting diversity of benefits have a positive effect on any company’s economic activity and worker productivity. Especially during the post-pandemic period, we could see employees expecting from their employers a package of benefits that’s flexible and tailored to their needs. We have written before about the advantages of flexible reward schemes. In this article we are looking at a new technology solution that will help companies improve their benefits packages by tailoring those to the desires of their employees.
Employee stock ownership plans are becoming increasingly popular as a way to boost staff motivation in companies around the world, including the Baltic States. The popularity of stock options is due to how they benefit both the company and the employee. Stock options give employees the right to receive or buy shares in their company after a specified period and for a price below the market value. The company benefits by having employees who are willing to work towards its goals and increase its stock value. Since the national rules for taxing this fringe benefit vary from country to country, it’s important to review the tax laws of Lithuania, Latvia and Estonia.
Globalisation means it’s common for companies to have their corporate clients and various procurement projects in countries other than their main place of business. To properly benefit from foreign procurement projects, it’s important to assess not only the benefits but also risks associated with such business opportunities, particularly tax risks. If your company has a permanent establishment (PE) in a foreign country, it’s important to be aware of the corporate income tax and payroll tax implications of operating there. In this article, we take a look at employment tax risks and key issues to consider.
