This guide provides an overview of VAT in Latvia, including applicable rates, registration requirements, compliance obligations, and filing deadlines. It is designed for businesses engaging in transactions within Latvia.
Latvia uses VAT as a tool to promote green energy, with reduced rates on eco-friendly products.
Foreign businesses that incur VAT on eligible expenses in Latvia may be able to reclaim it.
All EU countries
Doing business in Latvia? You’ll need to play by the rules of the Latvian VAT Act.
Only businesses that exceed the VAT threshold must register; those below it may choose to register voluntarily.
Latvia applies VAT on digital services based on the consumer’s location, generally utilizing the OSS system for EU cross-border services.
A VAT refund application in Latvia should be submitted before 30 September of the year following the year in which the VAT in Latvia was incurred, for a VAT refund in Latvia under both the 8th Directive and 13th Directive. VAT refunds in Latvia can be made quarterly and annually, however the claiming periods for Latvia VAT refunds are not allowed to overlap with one another.
Quarterly Latvia VAT refunds under both the 8th Directive and 13th Directive should exceed EUR 400.00. Annual Latvia VAT refunds under both the 8th Directive and 13th Directiva should exceed EUR 50.00.
In addition to the standard VAT rate in Latvia of 21%, there are also reduced VAT rate in Latvia of 12% and 5% which are charged on certain items such as foodstuff, pharmaceutical and medical equipment and passenger transport. Expenses that are generally claimable in a VAT refund in Latvia are charged VAT at the standard VAT rate in Latvia, except for Taxis and public transport fares as well as Accommodation which is charged at the reduced VAT rate in Latvia of 12%.
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