Taxes

Recently, the Court of Justice of the European Union assessed a significant issue in connection with the application of the tax debt recovery procedure against board members for the unpaid tax debts of the commercial companies they managed. The Regulatory Framework in Force in Latvia In Latvia, a board member may be held personally liable […]

Calculating capital gains tax in the event of real estate alienation still raises many practical questions. This is not surprising, as the possible situations vary greatly, and consequently, the results of the tax calculation also differ. Furthermore, the explanations provided by authorities and courts do not always coincide. In this article, we will look at

Recently, the Court of Justice of the European Union (CJEU) has issued several judgments regarding the link between transfer pricing and VAT. It would be beneficial for companies to evaluate how these rulings may affect their pricing policies and tax bases in intra-group transactions. A previous article on transfer pricing adjustments (here) extensively covered their

Recently, the State Revenue Service (SRS) published a clarification regarding the frequency of tax invoice issuance for long-term services. The question arose in connection with land lease agreements concluded for a period of 12 months or, in some cases, even 60 months. Specifically, it was assessed whether, in a situation where a lease service is

Latvian transfer pricing regulations stipulate that transactions between related parties, regardless of their country of residence, must comply with the arm’s length principle, ensuring the same economic result as in comparable transactions with unrelated parties. Although this principle is well-known in the business environment, consistent compliance in practice is often hindered by objective circumstances—unavailability of

The Value Added Tax (VAT) Law and Cabinet Regulation No. 1514 set out the procedure by which a Latvian VAT payer can request a refund of VAT paid in another European Union Member State. This procedure applies in situations where a Latvian company has paid VAT in another Member State for goods or services (e.g.,

For several years now, the State Revenue Service (SRS) has been actively recovering companies’ tax debts from the transferees of these companies. Specifically, in cases where it can be established that a company (tax debtor) has been acquired, i.e., everything necessary for the continuation of the respective economic activity without significant changes has been transferred

When the SRS addresses related party loans, the central issue is almost always the interest rate. In practice, a seemingly simple approach is often used: to compare the loan interest rate with the average indicators published by the Bank of Latvia and, if it exceeds the “average”, to make tax adjustments. The Senate of the

For a long time, loans to board members, shareholders, and other related parties were perceived in business practice as a low-risk issue. They were not at the top of the State Revenue Service (SRS) priorities, and many companies concluded based on this: “if no one has asked anything so far, then everything is fine.” This

In transfer pricing matters, businesses are often convinced that the risk is theoretical or applies only to ‘very large’ or international companies. Practice shows otherwise. Often, the decisive factor is not the transaction volume or structural complexity, but how well the company is prepared to justify its prices when the SRS (State Revenue Service) asks