Governmental aid and tax reliefs 2020

Tax reliefs and aid to business are entered by Regulations of The Cabinet of Ministers No 165  which came into force 26.03.2020. 

The following employers and taxpayers which have been affected by the crisis are entitled to apply for the allowance for idle time and the division of the payment for late tax payments in instalments or deferral thereof for a period of up to three years:

1) whose income from economic activity has, due to the spread of COVID-19, decreased by at least 30 % in March or April 2020 in comparison with the respective month in 2019;

2) whose income from economic activity has, due to the spread of COVID-19, decreased by at least 20 % in March or April 2020 in comparison with the respective month in 2019, and they meet at least one of the following criteria:

a) in 2019, the export volume of the employer affected by the crisis amounts to 10 % of the total turnover or is not less than EUR 500 000;

b) the average monthly gross work remuneration disbursed by the employer affected by the crisis in 2019 is not less than EUR 800;

c) as on 31 December 2019, long-term investments in fixed assets are at least EUR 500 000.

The taxpayer shall submit a reasoned application to the tax administration not later than within two months after the due date of payment or the coming into force of this Law (21.03.2020).

The tax administration has the right to divide delayed tax payment into terms or postpone for up to three years from the date of submission of the application. 

Idle time compensation

 If the employer does not employ the employee (idle time), the employee shall be compensated according to the procedure and in the amount determined by the Cabinet of Ministers (regulations No 165) up to 75 per cent of the average monthly salary of the previous six months but not more that 700 EUR per month.

Real Estate tax payments

Municipalities may set different real estate tax payment dates as required by Law on Real Estate Tax but not later than the end of the year 2020

Personal Income tax

Personal income taxpayer should not make tax advance payments from economic activity in 2020.

VAT 

VAT overpayments declared after March 31, 2020 will be reimbursed within 30 days

 Please do not hesitate contact us If you have any question on tax reliefs in Latvia !