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Baltic tax rates from 1 January 2021

  Estonia Latvia Lithuania
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 DDT 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 DDT 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% 20%, exemption may be applied according to DDT N/A
alienation of immovable property 20% 3% 15%
Rent/lease of real estate income 20% 5% 15%
Wage taxes:
Minimum monthly salary EUR 584 EUR 500 EUR 642
PIT rates -       20%;

-       Monthly basic exemption- EUR 500[2].  
-      20% rate on annual income up to EUR 20,004;

-      23% rate on annual income exceeding           EUR 20,004 to                 EUR 62,800;

-     31% rate on annual income exceeding EUR 62,800.
-       15% rate is applicable for sickness pay

-       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 as joined 2nd pillar.
10.50% Employee’s social security contributions - 19,5%, Participation of employee in pension scheme (optional) - 2,4-3%.
Employer rate -       33% social tax (the minimum monthly obligation for social tax is 584 EUR, it means, for an employer, the minimum obligation for social tax is 192,72EUR monthly);

-       0.8% unemployment insurance premium.
23.59% 1.61-3.75%
Solidarity tax N/A 25 % from income exceeding EUR 62,800 N/A
Value-added tax
Value added tax rates 20%, 9% and 0% 21%, 12% and 5% 21%, 9% 5% and 0%. Compensational rate for farmers is 6%.
VAT registration thresholds EUR 40,000 EUR 40,000 EUR 45,000
Annual EU distance selling thresholds EUR 35,000 EUR 10,000 EUR 35,000  
Intrastat reporting
Arrivals EUR 230,000 EUR 230,000 EUR 250,000
Dispatches EUR 130,000 EUR 120,000 EUR 150,000

[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.

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 6,000 EUR (500 EUR per month). If a person’s annual income is up to 14,400 EUR, they can use the exemption in full. If the annual income is between 14,400 to 25,200 EUR, the amount of the basic exemption is reduced pursuant to the following formula: 6,000 – 6,000 / 10,800 × (amount of income – 14,400).

  Tallinn, Estonia
Leinonen OÜ
Põhja pst. 25
10415
+ 372 6117 700 contact@leinonen.ee
    Riga, Latvia
Leinonen SIA
Vilandes iela 3           LV1010
+ 371 6732 3901 leinonen@leinonen.lv
    Vilnius, Lithuania
Leinonen UAB
Vilnius, Labdariu
5 01120
+ 370 5237 5040 leinonen@leinonen.lt

02.02.21


Author:   

Inga Jomanta

Senior Tax Advisor

Mobile: +37123995382

Email: inga.jomanta(at)leinonen.lv

Līga Treilone

Senior Tax Advisor

Mobile: +37123995387

Email: liga.treilone(at)leinonen.lv

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