# Latvia

 Country code: LV · Currency: EUR · Language: Latvian

**Pros**
- Zero percent corporate income tax on reinvested profits to encourage business growth and capital accumulation
- Advanced digital infrastructure and high-speed internet connectivity for efficient remote operations and global market access
- High level of personal safety and low population density offering a peaceful, high-quality lifestyle

**Cons**
- High social security contributions and labor taxes increasing the cost of hiring skilled local talent
- Persistent shadow economy and bureaucratic hurdles in public administration affecting fair market competition
- Geopolitical risks and regional security concerns due to proximity to unstable eastern borders

Long story short: In Latvia, reinvest your profits and the state won't touch a cent: corporate tax drops to zero as long as the money stays in the company.

The catch: banks, still shaken by a money laundering scandal, will make you jump through hoops to open a business account. Admin is slow on anything complex, and a bit of corruption still lingers around customs.

Beyond that: Riga's nicer neighborhoods are calm, roads and internet hold up well, the food stays basic, but the forests and Baltic coast are worth a weekend trip.

## Will your income be taxed?

Long story short: YES, A LOT.
Income gets *fleeced* in **Latvia** (top marginal rate **33%**), but the residency test is surprisingly hands-off.

The bill is brutal for residents; the whole game is simply not to become one by accident.

**01.1 Income tax**

| Metric | Value | Detail |
| --- | --- | --- |
| Personal income tax | 25.5 → 33% | progressive · 2 brackets |

| Bracket (USD) | Rate |
| --- | --- |
| 0 – 121,998 | 25.5% |
| 121,998 + | 33% |

**01.2 Tax residence test**

_A single active rule is enough to make you tax-resident._

| Metric | Value | Detail |
| --- | --- | --- |
| 183-day rule | exists here |  |
| Economic interest | does not exist here |  |
| Family centre | does not exist here |  |
| Habitual abode | exists here |  |
| Extended-stay test | does not exist here |  |

## Will your wealth be taxed?

Long story short: YES, A LOT.
**Latvia** shears capital gains hard (**28.5%** at the top), but at least it stops there: no annual wealth levy, no inheritance regime.

Selling is the trigger; as long as you don't pull it, the position compounds untouched.

**02.1 Investment income**

| Metric | Value | Detail |
| --- | --- | --- |
| Capital gains | 28.5% | progressive · +3% total income exceeds EUR 200,000 per year |

| Bracket (USD) | Rate |
| --- | --- |
| 0 – 231,716 | 25.5% |
| 231,716 + | 28.5% |

| Metric | Value | Detail |
| --- | --- | --- |
| Dividend tax | 28.5% | progressive · +3% income exceeding EUR 200,000 per year |

| Bracket (USD) | Rate |
| --- | --- |
| 0 – 231,716 | 25.5% |
| 231,716 + | 28.5% |

| Metric | Value | Detail |
| --- | --- | --- |
| Interest income | 33% | progressive |

| Bracket (USD) | Rate |
| --- | --- |
| 0 – 121,998 | 25.5% |
| 121,998 + | 33% |

**02.2 Wealth & estate**

| Metric | Value | Detail |
| --- | --- | --- |
| Wealth tax | NONE | no annual wealth tax · no real-estate wealth tax · no net-worth assessment |
| Inheritance system | NONE | no estate tax · no heir-based duties · no succession tax framework. Wealth transfers across heir-classes are not taxed in this jurisdiction. Only standard probate / registration fees may apply. |

**02.3 Crypto**

| Metric | Value | Detail |
| --- | --- | --- |
| Crypto · tax regime | PROGRESSIVE | Rate: 25.5% · As of the 2025 tax reform, Latvia treats crypto-assets as capital assets subject to a progressive Personal Income Tax (PIT) system. The base rate for capital gains is 25.5% (for income up to €105,300), rising to 33% for higher brackets. Recent guidelines from the State Revenue Service (VID) indicate that tax is generally triggered only upon conversion to fiat currency or goods; crypto-to-crypto swaps are typically not taxable events. Professional trading is classified as economic activity subject to progressive PIT and social security contributions. |
| Crypto-to-crypto | NEUTRAL | a swap is not a taxable realisation event |
| FATF travel rule | NOT SIGNED | no information-sharing obligation on VASP transfers |

## Easy to run a company there?

Long story short: YES.
**Latvia** runs *no corporate income tax* and *no criminal liability* for misuse of corporate assets: fiscally and legally featherweight.

The catch: registries are *public*, so your name as shareholder is one search away for any curious stranger. They won't tax you, they won't prosecute you. They'll just put you in the shop window.

**03.1 Rates**

| Metric | Value | Detail |
| --- | --- | --- |
| Corporate tax | 0% | flat · +20% on distributed profits · +20% Credit institutions and consumer crediting service providers (from 2024) · +60% Solidarity contributions for credit institutions on excess net interest income (2025-2027) |
| VAT standard rate | 21% | 3 distinct tiers in force |

| VAT family | Category | Rate |
| --- | --- | --- |
| Food & drink | food | 12% |
| Food & drink | non-alcoholic | 12% |
| Food & drink | alcohol | 21% |
| Print media | books | 5% |
| Print media | ebooks | 5% |
| Print media | newspapers | 5% |
| Culture | cultural events | 21% |
| Culture | cinema | 21% |
| Culture | theatre | 21% |
| Culture | museums | 21% |
| Culture | sports | 21% |
| Transport | public transit | 12% |
| Transport | rail | 12% |
| Transport | air | 21% |
| Hospitality | hotels | 12% |
| Hospitality | restaurants | 21% |
| Hospitality | takeaway | 21% |
| Health | pharma | 12% |
| Health | medical dev. | 12% |
| Energy | electricity | 21% |
| Energy | natural gas | 12% |
| Energy | district heat. | 12% |
| Energy | domestic fuel | 12% |
| Utilities | water | 21% |
| Utilities | waste | 21% |
| Clothing | kids clothing | 21% |
| Digital & telecom | digital | 21% |
| Digital & telecom | telecom | 21% |
| Digital & telecom | broadcast | 21% |
| Construction | construction | 21% |
| Construction | social housing | 21% |
| Agriculture | farm inputs | 21% |
| Agriculture | animal feed | 21% |
| Personal services | funeral | 21% |
| Personal services | hairdressing | 21% |

**03.2 Regime & registry**

| Metric | Value | Detail |
| --- | --- | --- |
| IP Box · Patent Box | NONE | no IP regime · IP income taxed under standard corporate rules |
| Misuse of corporate assets | NO CRIMINAL | no criminal liability · In Latvia, while a company is a separate legal entity, criminal prosecution for 'Abuse of Authority' (Section 196 of the Criminal Law) or 'Embezzlement' (Section 179) requires 'substantial harm' or 'illegal acquisition'. In a solvent company with a sole shareholder, the use of assets for personal purposes is treated as a tax matter (non-business expenses or deemed dividends) or a civil breach of the duty of care under Section 169 of the Commercial Law, as the owner's consent negates the criminal element of wrongfulness against the company's interests. |
| Shareholders privacy | PUBLIC | Enterprise Register of the Republic of Latvia |
| Directors privacy | PUBLIC | Enterprise Register of the Republic of Latvia |

**03.3 Incorporation cost**

_In this country, the most standard company form is called Sabiedrība ar ierobežotu atbildību (Limited Liability Company). The costs below are for incorporating a company in its simplest form, for reference only._

| Metric | Value | Detail |
| --- | --- | --- |
| State registration fee (Standard processing) | USD 174 |  |
| Official publication fee (Latvijas Vēstnesis) | USD 31 |  |
| Professional incorporation and legal service fee | USD 521 |  |
| Total | USD 726 |  |

## A good fit for a holding?

Long story short: YES.
**Latvia** is built for holding, plain and simple. An *extensive treaty network* (**60** signed agreements) hacks down withholding on cross-border dividends, interest and royalties, and a *full participation exemption* (**100%** on qualifying dividends and gains) lets value flow through without a domestic tollbooth.

Top-shelf plumbing: a holding parked here travels the world without leaking.

**04.1 Substance & exemptions**

| Metric | Value | Detail |
| --- | --- | --- |
| Territorial · individuals | WORLDWIDE | worldwide income taxation regardless of source |
| Territorial · corporates | TERRITORIAL | territorial principle — foreign-source profits generally exempt |
| Participation exemption | 100% | no minimum threshold · no holding period |
| CFC rules | APPLY | Latvian companies owning over 50% of a foreign entity's shares or profits must pay corporate income tax on their share of the foreign company's profits if the entity is an artificial arrangement used for tax advantages and lacks substantial business operations. |

**04.2 Withholding tax · non-resident**

| Metric | Value | Detail |
| --- | --- | --- |
| WHT · dividends | 0% | non-resident outbound |
| WHT · interest | 0% | non-resident outbound |
| WHT · royalties | 0% | non-resident outbound |
| Tax-haven WHT | 20% | penalty rate · blacklisted destinations |

**04.3 Treaty network**

| Metric | Value | Detail |
| --- | --- | --- |
| Treaties signed | 58 | active |
| Treaties pending | 2 | in negotiation |

## Easy to come and go?

Long story short: SOME.
**Latvia** taxes your worldwide income while you're resident, but at least the exit is free: *no exit tax* on the way out.

Leaving costs you paperwork, not money; your unrealised gains walk out the door with you, untouched.

**05.1 Exit & dual nationality**

| Metric | Value | Detail |
| --- | --- | --- |
| Exit tax | NONE | no triggers active · residence change tax-free · no deemed-disposal mechanism |
| Dual citizenship | ALLOWED | naturalised citizens may keep their existing nationality |

**05.2 Citizenship paths**

| Metric | Value | Detail |
| --- | --- | --- |
| Residence | 10 years | available path to naturalisation |
| Marriage | — | not available |
| Birth | — | not available |
| Descent | 1 gen | available path to naturalisation |
| Investment | — | not available |

## Is your money watched?

Long story short: YES, CLOSELY.
**Latvia** signed *every exchange framework that matters* and runs a *public corporate registry*. Whatever you do here (earn, hold, structure) is reported, searchable, or both.

Your money is watched from every angle; if discretion is part of your plan, this isn't your jurisdiction.

**Multilateral reporting frameworks — 5/9 active · 3 pending**

| Item | Status | Detail |
| --- | --- | --- |
| CRS | In force | 2017 |
| CARF | Signed | 2024 |
| FATCA | In force | 2014 |
| MLI | In force | 2019 |
| BEPS | Signed | — |
| MAAC | In force | 2014 |
| GLOBAL FORUM | Signed | — |
| EOIR | In force | — |
| CRYPTO TRAVEL RULE | None | — |

## Is it blacklisted?

Long story short: NO.
**Latvia** sits on no major blacklist, though it's *outside* the FATF club.

Some counterparties will run a bit of extra due diligence out of habit, but there's no formal stigma: you won't get hassled for dealing with it.

**Blacklist exposure — Clear everywhere**

| Item | Status | Detail |
| --- | --- | --- |
| EMBARGO | Clear | un / us / eu sanctions |
| FATF | Clear | grey / black list |
| EU | Clear | non-cooperative list |
| FRANCE | Clear | ETNC list |
| SPAIN | Clear | tax-haven list |
| PORTUGAL | Clear | favourable regimes |
| BRAZIL | Clear | low-tax list |

## Do you feel free there?

Long story short: PARTLY.
**Latvia** is an EU member, which puts it on the *digital euro* conveyor belt: a programmable, traceable CBDC built to run on the same rails as the currency itself.

Under *MiCA*, crypto is regulated rather than banned, but the direction of travel for money in the bloc is *state-controlled rails* by default.

Press freedom may sit high (RSF rank **\#15**); financial freedom is caught in a ratchet, and ratchets only turn one way.

**08.1 Press freedom**

| Metric | Value | Detail |
| --- | --- | --- |
| Press freedom · RSF index | 15/180 | score 81 · ↓ 3 ranks year-on-year |

Central bank digital currency

    Program Status Cross-border Sources     Digital Euro

A digital euro could support the Eurosystem's objectives by providing citizens with access to a safe form of money in the fast-changing digital world.

European Central Bank

   RESEARCH   —   [announce →](https://www.ecb.europa.eu/press/intro/news/html/ecb.mipnews250409.en.html "Announcement")    Wholesale Digital Euro

Main motivations are to (i) consolidate and further develop the ongoing work of Eurosystem central banks in this area, and (ii) gain insight into how different solutions could facilitate interaction between TARGET real-time gross settlement (RTGS) services and DLT platforms.

European Central Bank

   PILOT   —   —    Stella

It explores the opportunity for using DLT to improve financial market infrastructure to support payment and securities settlement.

European Central Bank

   RESEARCH   —   [announce →](https://www.boj.or.jp/en/announcements/release_2020/data/rel201009e1.pdf%0D%0Ahttps://www.boj.or.jp/en/announcements/release_2020/data/rel200212a1.pdf%0D%0Ahttps://www.tbstat.com/wp/uploads/2020/08/KPMG-CBDC-Report.FINAL_.v.1.02.pdf "Announcement")

 programs 3

## Connected to the world?

Long story short: EXCELLENT.
**Latvia** is wired straight into the global money grid: **9/11** of the services we track work here.

*Stripe* onboards you, so you can charge cards from a laptop the day you land. Wise, Revolut, PayPal: pick your rails, they all run. One footnote for your comfort, not your business: *Amazon* doesn't deliver here, so plan on local e-commerce for the doorstep part of life.

**Accept payments — 5/6 available**

| Item | Status | Detail |
| --- | --- | --- |
| Stripe | Available | card payments |
| PayPal | Available | wallet payments |
| Adyen | Available | enterprise psp |
| Mollie | Available | eu payments |
| GoCardless | Not available | direct debit |
| Paddle | Available | merchant of record |

**Bank and move money — 3/3 available**

| Item | Status | Detail |
| --- | --- | --- |
| Wise | Available | multi-currency |
| Revolut | Available | personal banking |
| Revolut Business | Available | business banking |

**Buy and sell on Amazon — 1/2 available**

| Item | Status | Detail |
| --- | --- | --- |
| Amazon | Not available | consumer delivery |
| Amazon Seller | Available | marketplace selling |

  SEE ALSO## Other jurisdictions worth comparing

Picked by similarity of strategic profile to Latvia. No editorial ranking — neighbours in the same scoring space.

  PROFILE-ADJACENT Same shape, comparable overall friction.

 [   Finland FI  → ](https://stateless.sx/en/country/fi) [   Czechia CZ  → ](https://stateless.sx/en/country/cz) [   Sweden SE  → ](https://stateless.sx/en/country/se)

  NOTABLY MORE FAVORABLE Same family of strategies, higher total score.

 [   Hong Kong SAR China HK  → ](https://stateless.sx/en/country/hk) [   Bermuda BM  → ](https://stateless.sx/en/country/bm) [   United Arab Emirates AE  → ](https://stateless.sx/en/country/ae)

  NOTABLY LESS FAVORABLE Same family of strategies, lower total score.

 [   Germany DE  → ](https://stateless.sx/en/country/de) [   Austria AT  → ](https://stateless.sx/en/country/at) [   Slovenia SI  → ](https://stateless.sx/en/country/si)