Below are answers to common questions, you can also ask your question by phone or through a feedback form
- Corporate tax rate is 0% – for Reinvested earnings;
- Safety of funds — reliability and settlements with the EU companies;
- Opportunity to obtain a residence permit when setting up a company;
- Favorable credit terms (% on credits);
- E-banking free use from any part of the world;
- Reduction of customs duties (when importing to the EU): final production for the EU market is moved to Latvia;
- Transportation business: transport company for the EU, customs duty is not charged;
- Financial information is stored on the servers in Latvia;
- Business security: a Latvian holding company is a share holder;
- Companies can be used for participation in tenders;
- Geographic location. Latvia shares borders with the EU;
- Possibility to use near-border customs warehouses; extensive network of roads, ports, railways and air traffic.
- dividends paid by a Latvian company to non-residents;
- dividends received by a Latvian company from non-residents;
- capital gains or loss on sale of shares in subsidiaries are not subject to corporate income tax;
- interest paid by a Latvian company to non-residents;
- payments made by a Latvian company to non-residents for intellectual property.
The most common legal form of a company in Latvia is a limited liability company (LLC).
LLC 1 EUR — 2 800 EUR and more
Joint-Stock Company – 35 000 EUR and more
legal entities / individuals
residents / non-residents
residents / non-residents
at least — 1 person
LLC is a legal entity. LLC is liable to the full extent of its assets. LLC is not liable for obligations of its shareholders, and its shareholders are not liable for obligations of LLC.
Holding company is used to improve tax efficiency of the whole goup, and tax relief is the key factor to create such a company. Latvia has a favorable tax regime for creation and operation of holding companies.
Benefits of Latvian Holdings Companies:
- dividends received and dividends paid by a Latvian company are not subject to taxation;
- capital gains from sale of shares are not subject to taxation;
- interest and royalty paid to non-residents are not subject to taxation.
Trading company is used to make a profit on trade transactions. A company can sale goods or provide services with minimum tax expenses.
Benefits of Latvian Trading Companies:
- free economic activities in the EU;
- VAT registration when conducting activities in the EU;
- EORI for export and import transactions;
- company assets and turnover are not subject to taxation;
- trade transactions are not subject to VAT;
- export transactions are not subject to VAT.
- simple company registration and management process;
- company registration process takes 5 days;
- good reputation in business area (the country is not blacklisted by other states as an offshore territory);
- social environment of business is understandable for investors from the CIS states;
- widespread use of Russian in business environment;
- geographic proximity and therefore dealing of Latvian companies with businesses from the CIS states;
- a holding company has no restrictions on types of activity, official domicile of its shareholders, size of shareholding, and shareholding period;
- Riga’s location is convenient for visiting and personal participation in company management;
- in contrast to Malta, Cyprus, Great Britain and Ireland, setting up a company in Latvia is an opportunity to obtain a residence permit for an investor and his/her family members.
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