Flash News Archive

In an attempt to expand its business a company offers one of its senior members of staff a five-month secondment to Germany. His contract of employment is amended to state that his permanent place of work will be in Bremen. The company undertakes to cover his living expenses in Germany and to pay for his occasional trips to visit his family staying behind in Latvia. What taxes does this arrangement involve? Read further »

If your employees regularly go on business trips to other EU member states, attending exhibitions and conferences, they often buy goods and services there and pay local VAT. Under EU Council Directive 2008/9/EC, 30 September is the deadline for claiming a refund of VAT paid in another member state in 2009. This article explores how VAT can be reclaimed beginning 1 January this year. Read further »

We have informed our subscribers that 1 May 2010 is the effective date for European Parliament and Council Regulation (EC) No. 883/2004 on the coordination of social security systems and for its Implementing Regulation (EC) No. 987/2009. Regulations are international documents whose provisions are directly applicable without being passed into the national law of each member state. This article explores a few points relating to how Regulation 883/2004 will be implemented. Read further »

Passed in 1997, the Real Estate Tax Act stated that dwelling houses should be taxable. The original intention was to tax them from 2000, then from 2004, but later this provision was scrapped until 2010, when the much debated amendments came into force bringing in a progressive tax. This article takes a look at the current state of play and outlines changes expected in 2011. Read further »

Importers taking goods to home use in Latvia often realise at the time of importation that there are some missing invoices and the actual value of ancillary services is unknown. This situation, involving monthly visits to customs offices in order to adjust import declarations, has hindered commerce significantly in recent years. This article takes a look at how the VAT Act has been amended to deal with the assessment of additional VAT on imports. Read further »

New amendments to the Personal Income Tax Act are due to come into force on 9 June this year. This article explores what we perceive as key changes. Read further »

The much debated amendments to the Immigration Act are due to come into force on 1 July this year. This article outlines amendments relating to how a temporary residence permit may be granted to individuals acquiring real estate in Latvia or investing in Latvian companies. Read further »

Interest and royalty payments to related EU companies have been eligible for withholding tax at a reduced rate of 5% since July 2009, while dividends payable to EU/EEA companies have been exempt. This article discusses a few points to bear in mind when it comes to qualifying for these favourable arrangements. Read further »

Services, in particular management services, are a common type of inter-company transactions in multinational groups. Service fees are normally calculated using the cost-plus method or the transactional net margin method – either involves an arm’s length mark-up (profit element) being added to service costs. Yet service costs may be difficult to determine, especially where services are rendered to more than one company. Read further »

On 20 May this year the Latvian parliament adopted amendments to the Public Procurement Act in their third reading. The Finance Ministry was initially aiming to implement the requirements laid down by European Parliament and Council Directive 2007/66/EC of 11 December 2007, yet the Latvian parliament managed to introduce a number of new provisions as well. This article explores what we perceive as key changes. Read further »