If a minimum presence of a foreign company in Latvia is required and no commercial activity is planned, the choice should fall on registering a representative office of a foreign merchant in Latvia. A representative office of a foreign merchant in Latvia is an organisationally independent part of a company registered abroad, which is located in the Republic of Latvia. A representative office is not a legal person, and it does not have the right to conduct commercial activities in Latvia. A representative office can be registered for representative purposes: to look for clients, partners, present goods or services, perform other activities on behalf of the foreign merchant; however, the conclusion of contracts, purchase of goods and services will be done with the foreign company. A representative office of a foreign merchant in Latvia is registered with the Register of Enterprises within five business days.

A representative office is not obliged to pay taxes within the meaning of the law, to submit reports and annual reports. The obligation to calculate and pay taxes may arise if the representative office hire employees.

The foreign merchant has to closely monitor the situation as to whether there arises an obligation to register a Permanent Establishment in relation to its representative office in Latvia and, from the point of view of the State Revenue Service (SRS), to pay taxes (VAT, CIT).

Most important aspects

A cost effective way to register a representative office of a foreign merchant in Europe. Cannot conduct commercial activities, is not a legal person.

Reports

A representative office of a foreign merchant in Latvia submits SIC reports (if employees hired) according to the general procedure.

Taxes

A representative office of a foreign merchant in Latvia pays PIT, SIC for employees according to the general procedure.

Why choose Latvia:

• Opportunity to register a representative office in Europe as Latvia is an EU member state;
• Centre of the Baltic States, extensive network of logistics centres;
• Simple tax and accounting legislation;
• Understanding and accommodating attitude from authorities incl. from the State Revenue Service towards entrepreneurs;
• CIT rate of 0% on reinvested profits: It is cost effective to register an LLC if the company plans to invest in further development of the LLC. Latvia is popular among investors in the IT industry;
• Short and simple legal person registration process (within 5 days);
• VAT number in Europe. Latvia has concluded 62 conventions on the avoidance of double taxation and the prevention of fiscal evasion.

Why choose Euroaudit:

• More than 20 years in the accounting market;
• Staff of 20 qualified accountants and consultants;
• We speak fluent Latvian, Russian, and English;
• Full accounting cycle (document processing, verification, entry into accounting program, preparation and submission of reports);
• In working with clients, we extensively use export of large amounts of data (Excel, XML);
• Extensive experience in VAT accounting in Latvia for foreign companies;
• Civil liability insurance;
• Large network of partners: Tallinn, Vilnius, Kiev, Baku. We cooperate on dealing with various matters on behalf of our clients.
• The right choice if you need a branch in Europe.

Euroaudit is your Representative in Latvia providing tax consultancy, accounting and legal person registration services. Please contact our specialists by phone +371 25900918 or e-mail: info@euroaudit.lv