Looking for shelter from the war, Ukrainian civilians are emigrating en masse. Several thousands of refugees have entered Latvia, and some Latvian companies have already come forward to employ them. This article explores the tax treatment of these persons being employed in Latvia.
Latvian tax residents are also taking the opportunity to work abroad. A Latvian tax resident meeting certain criteria may become a tax resident in the foreign country where he is employed. Selling real estate (RE) located in Latvia or other assets may raise the question of which country’s personal income tax (PIT) is payable on the profit you make on the transaction.
From 1 March it is possible to prepare the annual income tax return for 2021 through the Electronic Declaration System (EDS) of the State Revenue Service (SRS). This article explores what situations mandate this filing and what time limits apply, as well as other related issues.
With the labour market crossing national borders, Latvian employers are looking abroad to attract not only management talent but also routine workers. As the Covid-19 crisis lingers on and the significance of remote work grows, Latvian companies are increasingly wondering about the best ways to employ foreign workers, especially if they work remotely from their home country.
On 7 January 2022 the Constitutional Court ruled on case No. 2021‑06‑01, in which the Ombudsman claimed provisions of the Personal Income Tax (PIT) Act for determining traders’ taxable income are inconsistent with section 105 of the Constitution. This article explores why those provisions were challenged and what the ruling found.
Our experience suggests that individuals tend to disagree with tax authorities about how provisions of international law should be applied. There is often disagreement over which country’s tax law is applicable and to what extent. A dispute usually arises in the case of a cross-border transaction, i.e. if income is earned abroad. This article explores a few steps that will help you analyse the applicable law and find out whether your foreign-source income is subject to Latvian personal income tax (PIT).
On 8 October 2021 the Supreme Court announced a ruling on case SKA-301/2021 regarding expenses a person incurs in repaying a mortgage on an inherited real estate (RE), which may be treated as an investment in a functionally similar RE.
On 8 November 2021 Liepaja District Administrative Court heard a petition (case A42-02059-21) to overturn a State Revenue Service (SRS) decision assessing X (the petitioner) to extra personal income tax (PIT), a late fee and a penalty for undeclared income from person Y, who actually lives with X as they take care of each other and their child without entering into a marriage.
Since the adoption of a minimum rate for mandatory national social insurance (NSI) contributions, certain industries have seen an increase in the number of functions being outsourced. Companies are also consolidating their jobs to replace any part-time workers that were not socially insured for at least the minimum monthly wage. This article looks at extra work in detail.
We have already commented on the corporate income tax (CIT) treatment of flow-through dividends and looked at personal income tax (PIT) relief available to an individual receiving a dividend. This article explores potential pitfalls in the tax treatment of flow-through dividends if a change of shareholder takes place shortly before the company decides to distribute a profit.
