COMPANY FORMATION IN LATVIA

Since a long time, Latvia has been playing role of a bridge between the East and the West. In the past years, it has become a logistics centre of the Baltic region and also one of the leaders in the Eastern Europe in IT sector. Latvia is not only one of the most popular countries for transit, but is also attractive for business and immigration due to the obvious advantages, like similar mentality, knowledge of the Russian language and excellent infrastructure.

TRADE COMPANIES IN LATVIA

SIA- limited liability company:

Due to the latest changes in the international, and particularly in European legislation the resident status of the company and possession of the VAT number become the most important aspects of operation of your company. An increasing number of European partners prefer to cooperate with companies having the VAT number

Opportunity of registration of the VAT number and automatic assignment of the tax resident status make the Latvian companies popular for trade within the EU, and also for export of goods outside the EU borders.

In Latvia and there is an opportunity to receive the VAT number without losing tax advantages.

Key features of company in Latvia

1. STABILITY – logically organised legislation
2. LOW EXPENDITURE – affordable rental prices for accommodation and offices
3. TAX ECONOMY – 0% tax rate (enterprise income tax before profit distribution).
4. An opportunity to get the residence permit as for an employee of a company – no need for investments, which makes Latvia an attractive country for business and immigration.
5. Great opportunities for enterpreneurs.
6. Company formation packages available. Contact us!

Holdings

The biggest advantage of Latvia over such traditional “holding jurisdictions” like the Netherlands, Austria and Cyprus is the universality. To benefit from tax concessions to the Latvian holdings There are no additional requirements to enjoy the tax benefits like requirement for participating interest, duration of share ownership, nature of business, taxation level in the country of the subsidiary etc.

The European regulation about the parent companies and subsidiaries allowing the application of the withholding 0% tax rate (before profit distribution) to companies registered in the European Union is still effective. The withholding tax is reduced basing on the agreement on avoidance of double taxation signed by over 50 countries including Russia, Belarus, Ukraine, Kazakhstan and Azerbaijan.

LATVIAN COMPANY TAXATION

1. CORPORATE INCOME TAX (CIT): Standard CIT rate is 15%.
2. INCOMING DIVIDENDS: 0% to most dividends for non-residents.
3. CAPITAL GAINS TAX (CGT): 0% to the non-residents.
4. WITHHOLDING TAX:
5. DIVIDENDS: normally is 0% INTERESTS: Standard rate is 10%, unless exempt under EU Directive on Interests and Royalties or reduced under a Tax Treaty.
6. VAT. European Union VAT regime. The standard rate for inland sales is 21%.

How to register a company in Latvia?

1. Choose a structure, what is appropriate for your business. Need help? Contact us.
2. To find out more, please contact us.