Incorporation documents preparation
Apostilled set of documents
Good offer Latvia STANDARD
Republic of Latvia (Latvia) – is a state located in the north of Europe. The country is a member of EU, NATO, WTO, part of the Schengen zone. The global crisis of 2008-2010 affected detrimentally on the Latvian economy and the country was forced to take urgent measures to attract foreign investment. In particular, it has been greatly simplified the procedure for obtaining a temporary residence permit with the purchase of property. Creating of favorable conditions for holding activities marked a new stage in the offshore business development in the country.
The term "Latvia offshore" should not be taken word-for- word, since there are a tax, it is also required financial statements and data about company are public information. With that, the country offers great opportunities for tax planning and asset protection.
One can register the following forms of business in the offshore zone in the Republic of Latvia:
- Limited Liability Company (SIA);
- Joint Stock Company (AS);
- Partnership (PS, KS);
- Private Entrepreneur (IK);
It should keep in mind some features, choosing a name for the company:
- The form of company should be mentioned in the name (abbreviation, full name);
- It should not coincide with the names of existing companies;
- The name should not mislead as to the type of activity;
- Should not include the name of the country (Republic of Latvia or territories and boroughs).
The minimum size of the authorized capital of SIA, which is the most popular form of the company, shall be not less than 2 000 lats (about 2800 euros). For AS the sum is at least 25 000 lats (35,520 euros), in the case of micro-business registration the amount of capital is 1 lat. The company can be referred to this category if its founders – are just private persons, and involved only in this micro-business with an annual turnover less than 70 000 lats, the number of employees – are not more than 5 persons and a member of the board may be only employees of the company. For such company there is a simplified tax system and submission of reports.
For company opening it should be minimum one shareholder - private or legal person of any residence. It is allowed sole ownership of the company for non-resident. For SIA management it is appointed the board of directors by the supervision board (from 1 to 3 persons - private persons with any residency). It is necessary two founders for partnership opening.
The Company submitted financial and tax statements on annual basis. Audit is mandatory for companies whose asset size is more than 400 000 euro, or annual turnover is more than 800 000 euro, or the staff is more than 25 people.
The legal address of the company must be registered in the territory of Latvia. Information about company, its directors, shareholders and statements are in open access; information about beneficiaries are disclosed to the registered agent.
Offshore Latvia has indisputable advantages:
- Possibility to use the European sales market and labor force, European infrastructure and logistics, goods transportation within euro area;
- VAT rate will be zero, if the goods or services supplied within the European Union;
- Possibility to use the free economic zones, which have a number of organizational and tax benefits;
- Small or large company registration gives the right to receive residence permit in Latvia, therefore one have the right of visa-free travel within the Schengen countries and can use the financial possibilities of Eurozone.
Offshore zone Latvia is characterized by a flexible system of taxation, at which there is one possibility to use the tax credits. Resident and non-residents companies, leading business activities are considered as tax residents. Income enterprise tax is charged at an interest rate of 15%, that is the most democratic in Europe, regardless of where the income was received. Income tax is not keep from dividends received from non-resident companies, as well as within payment of dividends, interests and royalties to non-residents, but only if these companies are not registered in the countries included in the "black list" of Latvia. In this case, there are standard rates: on dividends - 15%, on royalties - from 5% to 15%. Private persons pay income tax at the rate of 24%. VAT is charged at the rate of 21%, reduced rate is 12%.
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