Latvia Company Formation
Latvia Company Formation: Your Gateway to the Baltic and EU Markets Main Characteristics and the basic rules of Company registration in Latvia
Latvia Company Formation with BRIS Group
BRIS Group provides professional Latvia company formation services for entrepreneurs, investors, and international businesses looking to establish a reputable European base. Forming a Latvian SIA (Limited Liability Company) offers limited liability protection, access to EU markets, and a competitive business environment. Our experts manage the entire Latvia company registration process remotely, including corporate banking support, compliance, and ongoing administration, ensuring your business operates efficiently and in full compliance with Latvian regulations.
Start your Latvia company with BRIS Group today — trusted experts in global incorporation.
Guide to Forming a Company in Latvia
Latvia has become one of Europe’s most dynamic and investor-friendly business destinations, offering strategic access to both Western and Eastern European markets. Its efficient company registration process, competitive tax system, and fully digital government services make Latvia company formation an ideal option for non-residents seeking a cost-effective European base.
This comprehensive guide explains the advantages, company structures, tax system, and step-by-step registration procedures for forming a company in Latvia.
Why Choose Latvia for Company Formation?
Latvia’s open economy, modern infrastructure, and investor-friendly environment make it one of the most appealing jurisdictions in the European Union for foreign entrepreneurs.
Key Benefits of Latvia Company Formation:
- EU Membership: Full access to the European single market and financial system.
- Attractive Corporate Tax Regime: 0% corporate tax on retained and reinvested profits.
- Digital Incorporation: Register and manage your company online through e-signature or local representatives.
- Strategic Location: Connects Scandinavia, Central Europe, and the CIS markets.
- Cost-Effective Operations: Low setup, administrative, and labor costs.
- Stable Banking and Legal Environment: Transparent EU regulations with investor protection.
- Skilled Multilingual Workforce: English, Russian, and Latvian widely spoken in business.
Types of Companies in Latvia for Non-Residents
Latvia offers several legal structures suitable for foreign investors, depending on business size, investment, and scope.
|
Company Type |
Description |
Minimum Capital |
Best For |
|
SIA (Sabiedrība ar Ierobežotu Atbildību) |
Private Limited Liability Company — the most popular and flexible option for non-residents. |
€2,800 (€1 for micro SIA) |
SMEs, startups, tech firms |
|
AS (Akciju Sabiedrība) |
Joint Stock Company — allows public share issuance; ideal for large-scale enterprises. |
€35,000 |
Large corporations |
|
Branch Office |
An extension of a foreign company; not a separate legal entity. |
N/A |
Established international companies |
|
Representative Office |
Non-commercial presence for market research and liaison. |
N/A |
Promotional and market testing activities |
Advantages and Considerations for Non-Residents
|
Advantages |
Considerations |
|
0% corporate tax on reinvested profits |
Tax applies only on distributed profits |
|
Simple and fast registration process |
Some documents must be notarized or translated |
|
Low maintenance and operating costs |
Local address and representative required |
|
Full access to EU and EEA markets |
Accounting must comply with Latvian GAAP |
|
Competitive labor costs |
Limited availability of local directors for hire |
Requirements for Company Registration in Latvia
To form a company in Latvia, non-residents must comply with specific legal and administrative conditions.
- Company Name: Must be unique and registered with the Commercial Register of Latvia.
- Registered Address: A legal address within Latvia is mandatory.
- Shareholders: Minimum of one shareholder (individual or corporate).
- Directors: At least one director (no residency requirement).
- Share Capital: Minimum €2,800 for a standard SIA or €1 for a micro SIA.
- Articles of Association: Defines the company’s purpose, governance, and share structure.
- Bank Account: A corporate account in a Latvian or EU bank for capital deposit.
- Registration with the Commercial Register: Official incorporation with the Enterprise Register of the Republic of Latvia.
- Tax and VAT Registration: Registration with the State Revenue Service (VID) for tax purposes.
Step-by-Step Procedure for Latvia Company Formation
Step 1 – Choose the Company Type
Select the right structure (SIA, AS, or Branch) based on your business goals.
Step 2 – Reserve a Company Name
Verify and reserve your company name through the Latvian Commercial Register.
Step 3 – Prepare Incorporation Documents
Draft the Articles of Association, shareholder agreement, and other required documents.
Step 4 – Deposit Share Capital
Open a temporary bank account and deposit the minimum required share capital.
Step 5 – Register with the Commercial Register
Submit all incorporation documents (digitally or via notary) to the Enterprise Register.
Step 6 – Tax Registration
Register for corporate income tax and VAT (if annual turnover exceeds €40,000).
Step 7 – Open a Permanent Bank Account
After registration, convert the temporary account into a permanent corporate account.
Timeframe for Latvia Company Formation
| Stage | Description | Estimated Time |
| Document Preparation | Drafting incorporation and shareholder documents | 1–3 business days |
| Bank Account and Capital Deposit | Setting up and verifying capital deposit | 3–5 business days |
| Commercial Register Approval | Official registration and issuance of company number | 3–7 business days |
| Tax Registration | VAT and corporate tax setup | 3–5 business days |
Total Estimated Time: 1–2 weeks (depending on document preparation and authority response time).
Corporate Tax System in Latvia
Latvia’s corporate tax system is among the most competitive in Europe, modeled similarly to Estonia’s reinvestment-friendly regime.
Corporate Tax Overview:
- Corporate Income Tax (CIT): 0% on retained and reinvested earnings.
- Distributed Profits: 20% tax on distributed profits (20/80 of the net distribution).
- Micro-Enterprise Tax: Simplified tax for small companies with turnover below €40,000/year — taxed at 25%.
- VAT: Standard rate of 21%, with reduced rates of 12% and 5% for certain goods and services.
- Personal Income Tax: Progressive — 20%, 23%, or 31% depending on income level.
- Social Security Contributions: Approximately 34.09% (split between employer and employee).
Key Tax Advantages:
- Pay tax only when distributing profits.
- Transparent and EU-compliant tax structure.
- Over 60 double taxation treaties.
- Simple and fully digital tax filing system through VID e-services.
Post-Incorporation Compliance
Once the company is formed, maintaining compliance is essential. Latvian companies must:
- File annual financial statements with the Commercial Register.
- Maintain accurate accounting records under Latvian GAAP.
- Submit corporate income tax and VAT returns electronically.
- Hold an annual shareholder meeting.
- Maintain a registered address and contact information up to date.
How Our Professionals Can Help
Forming a company in Latvia is straightforward — but ensuring compliance and optimization requires expert guidance. Our corporate formation team provides end-to-end support for Latvia company formation for non-residents.
Our Services Include:
- Company name verification and reservation
- Drafting Articles of Association and legal documents
- Virtual registered office and local representative services
- Bank and fintech account opening assistance
- Tax and VAT registration with the State Revenue Service
- Accounting, payroll, and annual reporting support
- Corporate tax planning and compliance management
- Legal and business advisory services
Start Your Latvia Company Formation Today
Latvia combines digital efficiency, favorable taxation, and EU market access — making it one of the best jurisdictions for modern entrepreneurs and global investors. With 0% tax on retained earnings and quick online registration.
Contact us today to start your Latvian company formation process. Our team of corporate specialists will handle every step — from registration to tax compliance. We are committed to providing you with the highest level of service and expertise, ensuring your success in the Latvian market.
Questions & Answers
1. What is Corporation Tax in Latvia?
Corporation Tax in Latvia is set at a rate of 20% on distributed profits. This means that companies are only taxed when they distribute dividends, allowing for reinvestment without immediate tax liability. Latvia offers a unique taxation model that incentivizes growth and reinvestment.
2. What are the rules for dividends tax in Latvia?
The taxation of dividends in Latvia is generally at a rate of 20%. However, certain exemptions exist, such as reduced rates for EU-based entities under specific conditions. Additionally, dividend distributions from companies that have already paid Corporation Tax are not subject to further taxation.
3. How is Income Tax structured in Latvia?
Income Tax in Latvia is progressive. The standard personal income tax rate is 20% for income up to €81,100, while income exceeding this threshold is taxed at 31.4%. Residents also benefit from tax deductions, reducing their taxable income, such as for health expenses and educational costs.
4. What is the VAT rate in Latvia?
Value Added Tax (VAT) in Latvia is primarily set at 21%. There are reduced rates of 12% for certain goods, like heating, and 5% for specific medicines and books. Businesses must register for VAT if their turnover exceeds €40,000 within a 12-month period.
5. Are there other significant taxes in Latvia?
Yes, Latvia imposes several other taxes, including property tax, excise tax, and social security contributions. Property tax varies based on the property value and location, while excise taxes apply to goods like alcohol and tobacco. Social security contributions are mandatory and fund various social programs.
This FAQ aims to provide a concise overview of the main tax regulations in Latvia, essential for business and personal financial planning. Always consult with a tax professional for tailored advice.
Learn more: Visit our Full Frequently Asked Questions – Latvia page
or contact our tax and company formation team at [email protected]
What are the steps for forming a company in Latvia as a non-resident?
Forming a company in Latvia as a non-resident involves several key steps. First, you need to select a suitable company type, with the most common being a Limited Liability Company (SIA). Next, you must prepare the necessary documentation, including a business plan, identification documents, and a signed shareholder agreement. Then, you will register your company with the Latvian Register of Enterprises and open a bank account. Finally, you may need to apply for necessary permits and licenses, depending on your business activities. It’s advisable to consult with local legal or business professionals to smooth the process.
Do I need a local partner to start a business in Latvia?
No, you do not need a local partner to start a business in Latvia. Non-residents can fully own their companies without the requirement for a Latvian partner. This makes Latvia an attractive option for foreign entrepreneurs looking to establish a business in Europe. However, to facilitate the process, it may still be beneficial to engage local legal or accounting professionals who understand the regulatory environment.
What is the minimum capital requirement for Latavian companies?
For a Limited Liability Company (SIA) in Latvia, the minimum share capital requirement is €2,800. However, at least €1,400 must be paid up before registration. This requirement ensures that the business has sufficient financial backing to commence operations. Other company types, such as Public Limited Companies, have higher capital requirements. It’s crucial to meet these specifications to maintain compliance with Latvian business regulations.
How long does it take to register a company in Latvia?
The registration process for a company in Latvia typically takes about 3 to 5 business days, provided that all documentation is in order and submitted correctly. However, this timeframe may vary depending on the complexity of the business structure and the efficiency of the applicant in addressing any queries or additional documentation requested by the Register of Enterprises. To expedite the process, it’s recommended to prepare thoroughly and possibly seek assistance from local experts.
What are the tax obligations for non-resident companies in Latvia?
Non-resident companies operating in Latvia are subject to corporate income tax, which is set at a rate of 20% on distributed profits. Latvia also offers a favorable tax environment with various incentives and exemptions, particularly for businesses that reinvest profits. Additionally, if your company has employees, you will also need to register for and pay social security contributions. Understanding the complete tax obligations is essential, and consulting with a tax advisor is advisable.
Can I open a bank account as a non-resident in Latvia?
Yes, non-residents can open a bank account in Latvia, typically after forming a company. Most banks require specific documentation, including proof of company registration, personal identification, and potentially a business plan. Due to anti-money laundering regulations, the application process may involve additional scrutiny. It’s advisable to research different banks to find one that meets your needs and consider reaching out to them beforehand to clarify their requirements for non-resident applicants.
Learn more: Visit our Full Frequently Asked Questions – Latvia page
or contact our tax and company formation team at [email protected]
This publication is provided for information purposes only. This info should not be treated as a substitute for a tax or legal consultation or legislation. You should not act on the basis of the information contained in this publication without having obtained individual advice from the professional expert.
BRIS GROUP does not assume responsibility for any damage resulting from decisions made by the reader on the basis of this publication.
About Latvia
Country: Latvia
Capital: Riga
Region: A country on the Baltic Sea between Lithuania and Estonia
Language: Latvian
Currency: Latvian lats (LVL)
Time Zones: GMT +2
Dial Code: +371
Abbreviations: LV
Helping Your Company Thrive in Latvia With us, starting and running a business in Latvia will be easy and efficient!
- Full support of the company’s registration in Latvia: from the preparation of documents to their submission.
- Remote registration: all processes are online, wherever you are.
- Secretary and Treasurer: we can take on these important roles.
- Nominal directors and shareholders: we will ensure the confidentiality of your information.
- Help in opening a bank account: we will simplify this complex process.
- Registration for taxes, VAT and EORI: ensure all requirements are met.
- Website development: we will create a professional online representation for your business.
- Logo creation: we will design a unique and memorable logo for your brand.
- Full administrative support of the company: we will take over routine tasks.
- Mailing address organization: we provide a reliable mailing address for your business.
- Organization of the virtual office: we will ensure the professional image of your company.
- Telephone answering service: we will answer calls on behalf of your company.
- Accounting, audit and reporting: ensure accurate and timely accounting.
- Preparing and filing a VAT declaration: let’s save you the trouble.
- Interaction with local authorities: take over communication with state institutions.
- Trademark registration: protect your brand.
- More Emphasis on Customer Input.