VAT in Latvia

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Latvia VAT

Latvian VAT rules are based on regulations drawn up by the EU, of which Latvia was a founding member. The Standard Latvian VAT rate is currently 21%, with a reduced rate of 12%. As an EU member, Latvia is obliged to implement the EU’s VAT Directives which provide guidance on VAT. Where there is a conflict, the European Directive takes precedence.

Latvia VAT law

Latvian VAT shall be paid by legal entities and natural persons. It is administered by the State Revenue Service of Latvian Republic. A new Value Added Tax law  entered into force on 1 January 2013, replacing. The Law On Value Added Tax , which was in force from 1995 to 2012.

Latvian VAT registration

It’s been possible to buy and sell goods without a local company in Latvia since the European single market was implemented in the 1990s; this is known as non-resident VAT trading. There is no VAT threshold in Latvia for the registration of non-resident traders which perform the taxable transactions - for example, intra-community acquisitions and sales in the territory of Latvia.

There are strict rules on the situations where a registration is demanded. Common scenarios which require a Latvian VAT registration include:

  • importing goods into Latvia
  • organising live events, conferences, etc, in Latvia
  • 'supply and install' services
  • selling goods from Latvia to other EU countries
  • distance selling to private individuals, e.g. internet retailing (above €35,000).

Registering for Latvian VAT generally takes two weeks, although this can vary.

Latvian VAT fiscal representative

Both EU and non-EU companies are allowed to appoint a full VAT fiscal representative to represent them to the Latvian tax authorities – but it is optional.

b>Latvian VAT compliance

There are detailed rules controlling the recording and processing of Latvian transactions. These include guidelines on:

  • Latvian invoice requirements
  • credit notes and corrections
  • treatment of input and output VAT

Latvian VAT rates

The standard VAT rate in Latvia is 21%. There is reduced rate of 12%.

Latvian VAT returns

Companies with a Latvian VAT number must submit regular returns detailing all taxable supplies (sales) and inputs (costs).The returns are generally submitted monthly in Latvia, and are due by the 20th day of the month following the reporting period.

Latvian Intrastat and EC sales lists

In addition to VAT returns in Latvia, companies may be required to submit additional statistical information. The Latvian Intrastat return should be filed on the 10th day of the month following the reporting period and the Latvian EC sales list should be filed on the 10th day of the month following the reporting period.

Latvian VAT refunds

If a foreign company is incurring Latvian VAT on local goods or services, then Latvian VAT may be recovered through a VAT reclaim.

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