Tax·9 September 2026·15 min read

VAT Registration in Latvia - When It Is Required and How to Answer SRS Questions

The VAT registration threshold in Latvia is 50,000 euros per calendar year. But turnover is not the only trigger: in some cases a company must register before its very first transaction, whatever the amount.

This article covers the deadlines, the cases where registration is mandatory, and what happens after the application. A newly established company often receives a request from the State Revenue Service (SRS) with six questions - on funding, the bank account, bookkeeping, resources, staff and contracts. Each one is covered below with a sample answer.

Deadlines checked against the SRS: 9 September 2026.

Two VAT regimes: general and special

Before looking at deadlines, it is worth knowing which regime a company registers under. Latvia has two.

The general VAT regime makes a company a "full" VAT payer on both purchases and sales. The special VAT regime (Section 139.2 of the VAT Law, in force since 1 July 2025) is designed for small businesses with turnover of up to 50,000 euros: it lets them pay VAT on services bought from abroad (Facebook or Google advertising, for example) while continuing to sell their own goods and services in Latvia without VAT.

The main differences at a glance

Example. An SIA with 20,000 euros in turnover spends 200 euros a month on Facebook advertising. Under the special regime it calculates 42 euros of VAT and pays it to the budget - the advertising effectively costs 242 euros. Under the general regime the same 42 euros is calculated and immediately deducted as input VAT, so the cost stays at 200 euros, but 21% VAT must be added to every customer invoice. Which option works out better depends on whether the customers are VAT payers themselves.

Because the two regimes are fundamentally different, the rest of this article is split into two parts: Part 1 - registering under the general regime and Part 2 - registering under the special regime.

Part 1. Registering under the general regime

A company must register under the general regime if:

• its turnover exceeds 50,000 euros in a calendar year - the deadline depends on how far the threshold is exceeded (see the deadlines below);
• it supplies services to VAT-registered businesses in other EU countries - in that case the special regime is not available, whatever the turnover;
• it chooses to register voluntarily, for example to deduct input VAT on large purchases.

After registration, the company charges VAT on all its Latvian sales, deducts input VAT on purchases, files a VAT return every month by the 20th and pays the tax by the 23rd. It is registration under the general regime that the SRS typically scrutinises, and where it may send additional questions.

Deadlines in one table

The threshold counts VAT-taxable transactions plus certain VAT-exempt ones (real estate, financial and insurance services). Sales of fixed assets and intangible assets are not counted.

The VAT registration threshold - 50,000 euros per calendar year

Since 1 January 2025, the threshold has been calculated per calendar year, rather than over the previous 12 months. The count restarts from zero every 1 January.

The total includes:

• VAT-taxable supplies of goods and services;
• VAT-exempt transactions in real estate and in financial and insurance services (Section 52(1), points 20-22 and 24-26 of the VAT Law), unless they are incidental.

The total excludes sales of fixed assets and intangible assets.

Two exceptions that are easy to miss:

• Exempt transactions only. If 50,000 euros is reached solely through the exempt transactions above, registration is not mandatory.
• The previous year. If the threshold was exceeded in the previous calendar year, the right to stay unregistered until the threshold is reached no longer applies this year.

Voluntary registration before reaching the threshold is also possible. It often makes sense when customers are VAT payers themselves and the company has significant VAT-bearing costs: a registered payer can deduct input VAT.

Source: SRS, FAQ on VAT registration and special schemes (updated 15 May 2026, in Latvian); Ministry of Finance, announcement on the VAT Law amendments for small and medium-sized businesses (in Latvian).

Deadlines and when VAT starts to apply

If turnover exceeds 50,000 euros but not 55,000 euros

In this case registration can be deferred until the end of the year. The application must be filed by 30 November, and VAT applies from 1 January of the following year. If 50,000 euros is only exceeded in December, the application can be filed by 31 December.

Example. An SIA's turnover reaches 51,000 euros on 26 September 2026 and will not exceed 55,000 euros by the end of the year. The application must reach the SRS by 30 November, and VAT applies from 1 January 2027. If the SRS makes its decision at the end of November, nothing changes - the VAT start date remains 1 January.

If 55,000 euros is exceeded

Deferral is no longer possible. If 55,000 euros is exceeded before the application, it must be filed by the 15th of the following month, and VAT applies as soon as the transaction value exceeds 55,000 euros. If 55,000 euros is exceeded after the application has been filed, the SRS must be informed no later than the next working day, and VAT applies from that moment.

A consequence that often comes as a surprise: VAT on the amount above 55,000 euros is due even if the company is not yet registered and has not charged VAT on its invoices. The tax is treated as included in the transaction value - so it comes out of the company's revenue, not on top of what the customer pays.

Source: SRS FAQ (as above); SRS, summary of the VAT Law amendments (changes to Sections 34 and 59 from 2025, in Latvian).

When registration is required regardless of turnover

The threshold does not apply where registration is mandatory at any amount. For a small company, the three most common cases are:

• Services from foreign companies. If the company receives services whose place of supply is Latvia (Section 19(1) of the VAT Law) - for example, advertising on Facebook or Google, or platform fees from Amazon, Etsy or Booking - it must register before receiving such a service.
• Services to EU companies. If the company supplies services to a business in another EU country and the customer accounts for the VAT there (reverse charge), registration is required before the service is supplied.
• Purchases of goods from other EU countries. If purchases of goods excluding VAT exceed 10,000 euros in a calendar year, the company must register and account for VAT on the amount above 10,000 euros.

The first case is the most common trap: a company with a few thousand euros in turnover starts advertising on social media without knowing this already requires VAT registration.

If turnover stays within 50,000 euros and registration is needed only because the company receives services from abroad, it can choose the special VAT regime. This option is not available if the company supplies services to VAT-registered businesses in other EU countries - in that case, standard registration applies. It is worth assessing which procedure suits the company before applying.

Source: SRS, seminar material on VAT registration in 2025 (in Latvian); SRS, VAT registration for businesses (in Latvian); SRS, special VAT registration procedure for small businesses (in Latvian); SRS, overview of VAT registration conditions (EU purchases, in Latvian).

How to apply

The application for registration in the SRS VAT register can be submitted:

• through the Electronic Declaration System (EDS);
• by e-mail to vid@vid.gov.lv, signed with a secure electronic signature;
• in person at any SRS client service centre.

My practical advice: prepare the documents listed in the SRS questions section below before you apply. If the SRS asks for them, the reply can go out the same day - and every day of waiting is a day without a VAT number.

Source: SRS, Value Added Tax.

What happens after you apply - the standard SRS process

1. The SRS assesses the risks. It checks whether the company has real material, technical and financial capacity to carry out the declared activity, and whether there are tax payment risks.
2. If there are no questions, a decision is made within five working days of receiving the application.
3. If the SRS needs more information, it sends a request about the company's material, technical and financial capacity. The decision is then made within five working days of receiving the information.
4. The decision is posted in EDS. The company is considered registered from the day the decision is deemed notified (with deferred registration, VAT still applies from 1 January).
5. If information is not provided, or is incomplete or false, the SRS may refuse registration. The refusal can be appealed, or the gaps can be addressed and a new application submitted.

In practice: if the SRS requests no information, the VAT number arrives in about a week. If it does, the total time depends mainly on how quickly the reply is prepared - which is why it pays to have the documents ready in advance.

Source: SRS seminar material (as above) - VAT Law, Section 66(1), (3) and (4), and Section 67.

Six typical SRS questions and sample answers

For a new company, the SRS request usually looks like the list below (the wording may vary slightly). For each question: what the SRS is checking, what to submit, and a sample answer.

The SRS works in Latvian and asks for documents in the state language, so the reply itself and any foreign-language agreements should be in Latvian or come with a Latvian translation. The samples below are in English for reference.

One principle for every answer: each statement needs a document behind it. More importantly, the answer must reflect the real situation. False information about material, technical and financial capacity is grounds for refusal, and can later lead to removal from the VAT register.

1. Funding

The SRS asks: "Provide documentary evidence of the funds that will be used to maintain and develop the business, including paying taxes. If a loan is planned, submit a copy of the loan agreement."

What the SRS is checking: whether the company has money to start operating and pay its taxes, and where that money comes from.

What to submit:

• a bank statement showing paid-up share capital or the current balance;
• if funded by a loan - the loan agreement (amount, term, interest, repayment) and the payment order confirming the transfer;
• any customer prepayments, with supporting documents;
• a short cash flow plan for 6-12 months.

If the lender is an individual, the SRS may also ask about the origin of the lender's funds - it is worth addressing this in the reply.

Sample answer: "[Company] SIA will fund the start of its operations and its tax payments for the first [6] months from share capital of [amount] EUR and a loan of [amount] EUR from shareholder [name] under the loan agreement of [date]. Attached: account statement as of [date], copy of the loan agreement, payment order for the loan transfer, cash flow plan for [period]."

2. Bank account

The SRS asks: "Submit a bank document (account agreement, certificate or statement) confirming a permanent current account in Latvia or abroad. Register the account in EDS."

What the SRS is checking: whether the company has a permanent current account through which payments with customers, suppliers and the state budget will be made.

What to submit:

• the account agreement or a bank certificate confirming the account, showing the account holder and IBAN;
• for an account with a foreign bank - the same from that bank, with a Latvian translation if the document is in another language.

If the request asks for the account to be registered in EDS, do this before sending the reply and confirm it in the reply.

Sample answer: "[Company] SIA's current account [IBAN] was opened with [bank] on [date]. The account was registered in EDS on [date]. Attached: bank certificate confirming the account."

3. Bookkeeping

The SRS asks: "Provide information on bookkeeping. Is there an agreement with an accounting service provider? Submit the agreement."

What the SRS is checking: who will keep the books and file the returns, and how. If bookkeeping is outsourced, the provider must be a licensed outsourced accountant - this can be checked in the SRS's register of licensed outsourced accountants.

What to submit:

• a signed accounting services agreement showing the scope of the service, and the accountant's licence number;
• if an accountant is being employed - the employment contract;
• if the manager keeps the books personally (allowed only for a sole shareholder who is also the sole board member - see question 5) - an explanation of how this is organised (software, document flow, responsible person).

Sample answer: "Since [date], [Company] SIA's books have been kept by licensed outsourced accountant [name], licence No. [number], under agreement No. [number] of [date]. The service covers bookkeeping and the preparation and filing of VAT returns and employer's reports. Attached: copy of the agreement."

4. Fixed assets and resources

The SRS asks: "Provide information on owned and leased fixed assets (a list of fixed assets and inventory). If there are none, explain how the company plans to carry out its work. Provide documentary evidence."

What the SRS is checking: whether the company has the physical resources for the declared activity - premises, equipment, vehicles, tools.

What to submit:

• a list of fixed assets and inventory: item, whether it is owned, rented or leased, and the supporting document;
• purchase documents and rental or leasing agreements;
• if a board member lets the company use their own computer, car or premises free of charge - a written free-use (loan-for-use) agreement;
• if there are no fixed assets - an explanation of how the work will be done: subcontractors (with agreements), remote work, or a purchase plan with amounts and timing.

Sample answer: "[Company] SIA provides [type of service]. It uses [a laptop, software licences] made available free of charge by the board member under the free-use agreement of [date], and office premises at [address] under the lease agreement of [date]. [Equipment] is planned to be purchased in [month] for approximately [amount] EUR. Attached: list of fixed assets and inventory, copies of the agreements."

5. Employees and the board member

The SRS asks: "The company has no registered employees. A board member is an employee if they perform functions that normally correspond to the tasks of a salaried employee. Assess whether the board member should be employed, or explain how the company's business will be carried out."

What the SRS is checking: who will actually do the work. A company that plans to earn revenue but has no employees at all is a risk signal for the SRS.

Your answer depends on your real situation:

• The board member will also do the day-to-day work. Set up an employment relationship, report the employee to the SRS before work starts, and pay a salary with taxes.
• The board member does everything alone, because the business is just starting. You can put off formal employment for now, but two limits apply:
  1. Bookkeeping. A board member may keep the books personally only if they are both the sole shareholder and the sole board member of the SIA (Accounting Law, Section 35, point 4). If the SIA has two shareholders or more than one board member, this option is not available.
  2. Turnover. If the SIA has no employee earning at least the minimum wage, watch the monthly turnover. As soon as it exceeds five minimum monthly wages, the board member automatically counts as an employee (Law on State Social Insurance, Section 1, point 2, sub-point "m"). In 2026 the limit is 3,900 euros a month. In 2027 it will be 4,100 or 4,175 euros, depending on the minimum wage the government approves. From that month, taxes must be paid on the board member's deemed income of at least the minimum wage. If there are several board members, this applies to each of them.
  Exception for new companies: in the calendar year the SIA is registered in the Register of Enterprises, no taxes are due on the board member's deemed income.
• Subcontractors do the work. Submit the service agreements. The board member handles management only.
• You plan to hire staff. Submit a plan: which roles, when, and at what pay.

If turnover is steady and the board member in fact does an employee's work but takes only dividends, or nothing at all, the SRS may treat this as employment, with all the tax consequences. In that case, my advice as an accountant is to formalise the employment rather than try to explain it away.

Sample answer (the board member does everything, including the books): "[Company] SIA started trading recently, and its volume of transactions is small. All duties, including bookkeeping, are currently carried out without pay by board member [name]. As the sole shareholder and sole board member of the SIA, [he/she] is allowed to keep the books personally (Accounting Law, Section 35, point 4). As soon as monthly turnover exceeds the limit set by the Law on State Social Insurance - five minimum monthly wages (3,900 EUR in 2026) - or the workload grows, the board member will be registered as an employee. Attached: revenue forecast for the next 6 months."

Sample answer (employment): "Since [date], [Company] SIA's board member [name] has been employed as [position] at [workload] with a monthly salary of [amount] EUR. The employee was reported to the SRS on [date]. Attached: copy of the employment contract."

Sample answer (subcontractors): "Services on behalf of [Company] SIA are provided by subcontractors under service agreements: [name, registration No., agreement date]. Board member [name] handles management only. Hiring is planned for [period]. Attached: copies of the service agreements."

Source: Law on State Social Insurance, Section 1(2)(m) (in Latvian); Accounting Law, Section 35 (in Latvian); BilancePLZ, explainer on board members' deemed income (in Latvian).

6. Agreements with business partners

The SRS asks: "Submit signed agreements, draft agreements or copies of arrangements with the company's business partners. Agreements must be submitted in the state language."

What the SRS is checking: whether the declared activity is real - whether there are customers and suppliers.

What to submit:

• signed agreements;
• if none are signed yet - draft agreements, letters of intent, commercial offers, e-mail correspondence confirming orders;
• for agreements in another language - a Latvian translation.

Sample answer: "[Company] SIA has concluded agreements with [number] customers and [number] suppliers: [partner, country, agreement date, subject, planned volume]. An agreement with [partner] is being finalised; the draft and correspondence are attached. Agreements in foreign languages are submitted with a Latvian translation."

How to put the reply together

• Reply through EDS as indicated in the request, and meet the deadline the SRS sets.
• Number the answers the same way as the SRS's questions.
• Give attachments clear names, for example "03_accounting_agreement.pdf".
• If a document does not exist yet, say so directly and add a plan with dates. An honest "not yet, expected by..." is better than an evasive answer.

After registration - what changes

• The VAT number is "LV" followed by the company registration number. It must appear on invoices and can be checked in the SRS's public database and the EU VIES system.
• Invoices must include VAT - the standard rate is 21%.
• The taxation period under the general regime is normally the calendar month. The return is filed in EDS by the 20th and the VAT paid by the 23rd. A nil return is mandatory even in months without transactions.
• Input VAT on purchases made before registration. In certain cases it can be deducted - worth reviewing with your accountant straight after registration.

All monthly deadlines are listed in the Latvia Tax and Filing Calendar 2026. If the company is still being set up, see also starting a business in Latvia: legal form and tax regime.

Source: SRS, VAT rates (in Latvian); SRS methodological material on completing VAT returns (in Latvian).

Part 2. Registering under the special regime (Section 139.2 of the VAT Law)

The special regime is not a "lighter" version of general registration - it is a different status with different obligations. The company stays outside VAT for its own Latvian sales and pays VAT only on what it buys from abroad.

Who can use it

A company or self-employed person can register under the special regime if both conditions are met:

• the value of its supplies of goods and services in Latvia did not exceed 50,000 euros in the previous and current calendar year;
• it does not supply services to registered taxable persons in other EU countries where the place of supply is determined under Section 19(1) of the VAT Law.

When to register

Registration is needed before the first service is received from an EU or non-EU company (social media advertising, platform fees from Etsy, Booking, Airbnb and the like), or once purchases of goods from other EU countries exceed 10,000 euros in a calendar year.

What changes after registration

• the company continues to sell its goods and services in Latvia without VAT;
• on services received from abroad and goods bought in the EU, it calculates 21% VAT and cannot deduct it - this VAT is a cost;
• no VAT return is filed. Instead, a VAT payment notice is submitted in EDS by the 20th of the month following the month of the transaction, and the tax is paid into the single tax account by the 23rd. In months without such transactions, nothing needs to be filed;
• in the SRS's public database, the VAT number carries a special mark, so business partners can see that the company is registered under the special regime;
• the regime can be combined with micro-enterprise tax status, but the cash accounting scheme (Section 137 of the VAT Law) cannot be used.

How to register

A structured application for registration under the special procedure (Section 139.2) is submitted in EDS - before the first foreign service is received. Once the application is reviewed, the SRS confirms the registration and its effective date in EDS.

Switching from the general to the special regime

A VAT payer that is already registered and meets the conditions can switch to the special regime by submitting the same application in EDS (a notification under Section 73(2.1) of the VAT Law). Within 30 days of the switch, a VAT payment notice must be filed on the value of inventory, advances and fixed assets for which input VAT was previously deducted - in other words, part of the deducted VAT has to be repaid. It is worth calculating this before switching.

When the right to the special regime ends

If turnover exceeds 50,000 euros, or the company starts supplying services to EU businesses, the right to the special regime is lost and the company must register under the general regime - see Part 1.

Source: SRS, special VAT registration procedure for small businesses (in Latvian); Business.gov.lv, registration under the special procedure (Section 139.2) (in Latvian); LV portals, explainer on the new special registration procedure (in Latvian); SRS clarification on notice deadlines via ifinanses.lv, how to complete the VAT payment notice (in Latvian).

Frequently asked questions

What is the VAT registration threshold in Latvia in 2026?

50,000 euros per calendar year. Since 2025, the threshold is counted from 1 January of each year, not over the previous 12 months.

By when must the application be filed once the threshold is exceeded?

If turnover exceeds 50,000 euros but not 55,000 euros, by 30 November, and VAT applies from 1 January of the following year. If 55,000 euros is exceeded, by the 15th of the following month, and VAT applies from the moment it is exceeded.

Do I need to register if I buy advertising on Facebook or Google?

Yes. Receiving services from a foreign company where the place of supply is Latvia requires registration before the service is received, regardless of turnover. A special VAT registration procedure may be available to small businesses.

How long does the SRS take to process the application?

Five working days after receiving the application. If the SRS requests additional information, the decision is made within five working days of receiving it.

What if the SRS refuses registration?

Review the reasons given in the decision. The decision can be appealed, or the gaps can be addressed and a new, more complete application submitted.

Note: This material is for information only and is based on publicly available information from the SRS and the Ministry of Finance, as checked on 9 September 2026. The sample answers are illustrative and must be adapted to the company's actual situation. For specific decisions, please consult your own accountant or lawyer.

Māris Nelsons, ACCA

Founder of SMAIDA Solutions. 25 years in financial management across banking, fintech and international groups.

Published: 9 September 2026.