BALTIC TAX RATES FROM 1 JANUARY 2024

 EstoniaLatviaLithuania
Corporate income tax (CIT) rate  CIT is payable upon  profit distributions (the deemed profit distribution).  CIT rate is 20%, calculated as 20/80 from taxable net payment.  Regularly paid dividends are subject to a reduced rate of 14% (14/86 from net dividends). CIT is payable upon  profit distributions (the deemed profit distribution).  CIT rate is 20%, calculated as 20/80 from taxable net payment. CIT is calculated as follows: Total income – non-taxable income – allowed deductions – limited deductions = taxable profit. Standard CIT rate is 15%. 20% CIT rate is applicable to credit institutions. 0% and 5% rates may be applied under certain conditions.
Withholding tax rates: 
Dividends 20% or 14%1 0% or 20%/10%, reduced rates may be applied according to DTT 0% or 15%, reduced rates may be applied according to Double Treaty Taxation (DTT)
Interest  20% to residents or N/A for non-residents 0% or 20%/10%, reduced rates may be applied according to DTT 0% or 10%
Royalties 20% to residents, 10% to non-residents or N/A, in case the exemption applies N/A 0% or 10%
Management/  consulting fee 20%, exemption may be applied according to DTT 20%, exemption may be applied according to DTT N/A
alienation of immovable property 20% 3% 15%
Rent/lease of real estate income 20% 5% 15%
Service fees payable to non-residents from non-cooperative tax jurisdictions 20% 20%Payments made by a Lithuanian company for services to foreign companies registered or otherwise organised in target territories are considered to be non-allowable deductions where the paying Lithuanian company does not supply to the local tax administrator evidence that: 1) such payments are related to the usual activities of the paying and receiving entity; 2) the receiving foreign entity controls the assets needed to perform such usual activities; 3) there is a link between the payment and the economically feasible operation.
Wage taxes:  
Minimum monthly salary EUR 820EUR 700EUR 924
PIT rates  20%; Monthly basic exemption – EUR 6542.     20% rate on annual income up to EUR 20,004;  23% rate on annual income exceeding           EUR 20,004 31% rate on annual income exceeding EUR 78,100 20% rate on annual income;32% rate on annual income.
Social security tax rates:     
Employee rate 1,6% unemployment insurance premium; 2% funded pension contribution (if the person has joined 2nd pillar); 10.50% Employee’s social security contributions – 19,5%, Participation of employee in pension scheme (optional): 3%.
Employer rate 33% social tax (the minimum monthly obligation for social tax is EUR 725, it means, for an employer, the minimum obligation for social tax is EUR 239,25 monthly); 0,8% unemployment insurance premium. 23.59% 1.77-2.49 % 
Solidarity tax  N/A 25 % from income exceeding EUR 78,100 The solidarity contribution is payable by the banks and credit unions on the surplus of the interest received in 2023 and 2024 from the Lithuanian residents’ loans. The tax base of the solidarity contribution is 50 % of the net interest income (interest income minus interest expenses) which exceeds the average net interest income of the previous 4 years (i.e. 2018 – 2021 for 2023 and 2019 – 2022 for 2024). The contribution is levied at a rate of 60 %.
Value added tax 
Value added tax rates  22%, 9% and 0% 21%, 12% and 5% 21%, 9% 5% and 0%.
VAT registration thresholds EUR 40,000 EUR 50,000 EUR 45,000 
Annual EU distance selling threshold EUR 10,000 for the sales all around EU      
Intrastat reporting  
Arrivals EUR 400,000 EUR 330,000 EUR 550,000
Dispatches EUR 200,000 EUR 200,000 EUR 400,000

[1] Regularly paid dividends are subject to a discount rate of 14/86. Please note: if the payment is made to a private person, income tax of 7% is charged on dividends. NB From 2025 a discount rate of 14/86 regularly paid dividends can no longer be used.

The income tax withheld can be 5% or 0% (depending on the tax agreement) in the case of a non-resident shareholder.

[2] The annual basic exemption is up to EUR 7,848 (EUR 654 per month). Basic exemption at pensionable age is EUR 9,312 per year (EUR 776 per month).

For more questions specific to individual countries, please contact the appropriate country’s office:

Tallinn, Estonia
Leinonen OÜ
Põhja pst. 25
10415
+ 372 6117 700
contact@leinonen.ee
 Riga, Latvia
Leinonen SIA
Vilandes iela 3           
LV-1010
+ 371 6732 3901
contact@leinonen.lv
Vilnius, Lithuania
Leinonen UAB
Vilnius, Gerulaicio
str. 10- 101 08200
+ 370 6101 5057
contact@leinonen.lt

Recent Posts

February 15, 2024

Embracing the Digital Shift: A Comprehensive Guide to eInvoicing in Lithuania

In response to a global shift towards digitization, Lithuania has embraced eInvoicing with open arms, revolutionizing the landscape of domestic finance. The Law on Public…

Continue reading
January 19, 2024

Can a company have more than one director?

Over 4 000 private limited companies were established in Lithuania last year. This legal form of legal entity (together with small partnerships) has been one…

Continue reading
December 18, 2023

Why is budgeting important for every business and what are the risks of relying on inaccurate financial data?

Year-end is a special time for companies preparing for the coming year. Typically, one of the most important processes for a successful company is the…

Continue reading