Company Formation in Latvia
Top 5 Advantages of Latvia
- Undistributed profits are tax-exempt (0%)
- Only 1 person required
- Reputable jurisdiction
- Little bureaucracy and low maintenance costs
- Fast company set-up
How long does it take to register a company in Latvia?
- 2-5 working days
- Can be done remotely in 1 week
What are the steps to register a company in Latvia?
The registration process of a company in Latvia is very simple. The experts of LegalBison will assist you throughout every step of it:
- Initial consultation and agreement
- Payment of the full invoice
- [IF REMOTELY]: Notarization of POA by client
- Preparation of registration documents
- Document signed at the notary
- Official register validity: immediately
How high are the corporate income tax in Latvia?
There are no corporate income tax per se in Latvia
- Only the distributed profits (dividends) are taxed at a 20% rate
- The tax system is designed to encourage business growth
What Double-tax treaties has Latvia?
Many countries have bilateral conventions to avoid double taxation and prevent fiscal evasion
Albania, Armenia, Austria, Azerbaijan, Belarus, Belgium, Bulgaria, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Georgia, Greece, Hong Kong, Hungary, Iceland, India, Ireland, Israel, Italy, Kazakhstan, Korea (South), Kuwait, Kyrgyzstan, Lithuania, Luxembourg, Malta, Mexico, Moldova, Montenegro, Morocco, Netherlands, Norway, Poland, Portugal, Qatar, Romania, Russia, Serbia, Singapore, Slovakia, Slovenia, Spain, Sweden, Tajikistan, Turkey, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, United States, Uzbekistan, Vietnam
Status: End of 2020
Without VAT number
- Your company will not be eligible to receive VAT refunds, which means everything bought is 21% more expensive (important: B2B payments between two VAT exempt companies are not more expensive)
With VAT number
- Any taxpayer can register for VAT with a simple application
- Your company will be eligible to receive VAT refunds, which means you can make use of the reverse-charge mechanism
- Monthly tax returns have to be filed, even if no transactions occur
- Payroll taxes must be paid at latest on the 10th of the next month
- VAT must be paid at latest on the 20th day of the following month it was applicable to
Before we help you to apply for a VAT number you should carefully think about the advantages and obligations that go along with it.
- Do you want to buy a ready-made company or start a new one?
- Can you travel or do you want to do everything remotely?
- Do you want a regular LLC with 2,800 EUR of share capital or a simplified one with 1 EUR of share capital?
Speak to our consultants to get a free consultation and guidance on how to choose the best jurisdiction based on your business model.
Documents to provide for company registration in Latvia
- Passport copies (a scan) of shareholder/s and director/s, also beneficiary owner if applicable
- A Power of Attorney (in case of a remote company registration)
- Certified company documents (in case at least one of the shareholders is going to be a foreign company)
Information needed to get started
- 3 options of your desired name for the company and a company contact email address
- Names, addresses and emails of all shareholders and board members
- Short description of your company’s activity
- The whole incorporation process can be conducted remotely. No travel necessary. Notarization of documents is necessary
- A Power of Attorney (POA) from (all) partners/shareholders is needed
- The POA is sent to you by us based on the services you want
- You have to certify the POA by a notary and in some cases legalize it by apostille (some countries need full legalization)
- Once you have the POA on your hands, we double-check, and you send us the original form (physical document!) via courier to our address
- Latvia is part of the Hague Convention of the Apostille
Accounting and auditing
- Accounting registers shall be maintained in Latvian, in euro currency, using a double entry accounting system and have to be kept together with source documents within the territory of Latvia
- Latvia uses the IFRS accounting standard
- An annual report including financial statement has to be filed every year
- Statutory audit is required for companies whose balance sheet exceeds 400,000 EUR and/or turnover exceeds 800,000 EUR and/or employees number exceeds 25 on average in the year
What are the residential requirements in Latvia?
- There are no residential requirements for a simple limited company
- 100% foreign ownership as well as directorships are allowed
LegalBison offers help with all of the above requirements. We assist and are local on ground. Speak now for free with one of our consultants to get your business started.
FAQs about doing business in Latvia
- 0% tax
- Perfect to begin with
- Easy process
- Very business friendly
- Competitive tax rates
- A growing EU economy
- Very low tax
- Foreigner friendly
- Everything remote
- Lowest tax rate in the EU
- Favorable for business
- Simple and fast
- 0% Tax if undistributed
- Everything is done online
- Just one person required