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.”
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.
Directive (EU) 2019/2161 adopted in late 2019 (the “Omnibus Directive”) requires member states to transpose it by 28 November 2021, and their amended national rules must come into force by 28 May 2022. This article explores key changes and requirements for traders under the new directive.
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.
As we carry on exploring the OECD’s Guidance on the transfer pricing implications of the Covid-19 pandemic (the “Guidance”) this article offers an overview of how government assistance programmes affect transfer pricing analysis.
Favourable rules effective from 2021 have cancelled certain fees that businesses had to pay when making various entries on the commercial register maintained by the Enterprise Registry (“ER”). In other words, when registering traders or any changes to particulars already entered on the commercial register, ER customers are no longer charged for an official announcement in Latvijas Vestnesis, the government gazette.
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.
Latvia has not yet lifted the emergency situation declared because of the Covid-19 pandemic. We have written earlier about a few aid measures available under the Covid-19 Containment Act to businesses affected by the crisis. There are also some other aid measures available, including grants for current assets. This article explores how the aid programme has been adjusted for this purpose.
This article explores hybrid mismatches, ways of identifying them, and a few practical aspects. Hybrid mismatches are basically differences in how a company or an instrument is taxed under the laws of two or more countries. An identified mismatch is eliminated by denying a deduction or by adding the amount to taxable income.
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.