|Tax system:||20%, 23%, 31% (2021)|
|VAT:||from 12% to 21%|
|Average salary:||850 € (2022)|
Latvia is a country located in the Baltic region of Northern Europe. Its capital is Riga and the local currency is the euro. Its economic power is demonstrated by some of the highest GDP growth in Europe. This country has been a leading member of the World Trade Organization since 1999; all medium, large and small companies in Latvia are mostly private and play an important role in the nation’s growth.
Foreigners are attracted to Latvia’s large and small scale offshore company formation investments, as it is a safe investment due to its thriving economy and favorable business environment. A company operating in this jurisdiction can be an advantageous European intermediary for trade between eastern and western “Russian-speaking” nations.p>
Note: Corporate tax is one of the lowest in Europe, only 20%.
1. Limited liability company
One of the most popular forms of company registration in Latvia is SIA. Investors can access a simple corporate registration and VAT application process, taking advantage of a corporate tax rate currently around 20% on trading income and enjoying a wide range of double taxation treaties.
The special participation regime was recently introduced in 2013. Unlike other “participation jurisdictions,” such as Austria and the Netherlands, Latvia does not bestow any requirements on participation organizations for holding periods or taxes. Such organizations enjoy a 0% tax on dividends from non-resident companies, no capital gains from the sale of shares, and double tax treaties with several countries.
Microenterprises are classified as standard limited liability companies with special taxation: only 9% on annual turnover. Such companies are mainly service providers and work for example with service organizations: marketing analysis, research, office work etc. They can turn into regular entities and register for VAT.
A company is considered a microenterprise when:
The establishment of offshore companies in Latvia involves a registration in the state register (Commercial Register of the Republic of Latvia). Subsequently, the newco is considered a legal entity, authorized to trade
Setting up a foreign company requires proper planning and an experienced Latvian offshore company formation agency. GR Morgan Formations is a reputable provider for setting up your company in Latvia.
We offer a wide range of business setup services including accounting, assistance with bank accounts and domiciliation. Regardless of the entity you choose, comprehensive business support is offered at fair prices.
Get in touch with our team for more details on setting up an offshore incorporation in Latvia.