Company in Latvia
15% CORPORATE TAX
SHELF COMPANY + VAT
REMOTE BANK ACCOUNT
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Positioned at the crossroads of northern and eastern Europe, the Baltic state of Latvia is rapidly making the most of its EU membership. Corporate tax rate is fixed at 15%, one of the lowest in the EU. A company in Latvia is well positioned to be an effective European intermediary for trade between Western and Eastern, “Russian- speaking” countries.
LIMITED LIABILITY COMPANY (SIA) FOR TRADING
The most popular business entity is the limited liability company (SIA) broadly used as Company in Latvia for EU trading as VAT registration is normally easy to obtain, and the corporate tax is only 15%.
Latvian Limited Liability Company is liable for taxation (15%) on worldwide income. Thus from its incorporation date at the Register of Enterprises it is considered to be a Resident Corporate Tax Payer, and can take advantage of numerous Double Tax Treaties.
LIMITED LIABILITY COMPANY (SIA) FOR HOLDING
Special holding regime is introduced in Latvia from January 1st 2013. As appose to other „holding jurisdictions” like the Netherlands, Austria, Cyprus, etc. Latvia does not impose any requirements to the holding company in terms of percentage of participation, holding period, type of activity or level of taxation in the country of the subsidiary, etc.
Dividends are exempt of withholding tax as of January 1st 2013.
Along with the new Latvian law the EU Parent Subsidiary Directive remain in action, allowing 0% withholding tax for EU resident companies. Withholding tax can be as well reduced under a double tax treaty. Latvia has concluded more than 50 double tax treaties, including Belarus, Ukraine, Kazakhstan, and Azerbaijan. The treaty is now signed with Russia, and is expected to enter into force in the year 2013.
Visit our Latvia dedicated page for more information about Latvian holding company benefits.
For companies with small turnover and low costs Latvian Micro-Enterprise is a low-tax, time & money consuming vehicle. Micro-Enterprise is a standard limited liability company with special taxation - 9% from turn-over (not profit!) It usually works for service companies i.e. consulting in any field, translations, marketing research, etc., thus companies with relatively low expenses.
Any entity can apply for 9% Micro-Enterprise Tax Status, if it meets the following criteria: