- LicensedState Revenue Service licence No. AGL0003786
- On timeEmployer’s report by the 17th, taxes by the 23rd
- In EnglishPayslips, questions and group reporting
- Clear pricingFrom €16 per employee, minimum €49 per month
Who we run payroll for
Any company that employs a person in Latvia has to run Latvian payroll, regardless of where the company’s owners sit. The obligation follows the employment, not the ownership. We work with three kinds of client.
Foreign groups with a Latvian entity
A subsidiary or branch in Latvia, often with a handful of employees and a finance team abroad. You get payroll that meets Latvian law and monthly figures in the format your parent company reports in, from one contact who answers in English.
Latvian companies outgrowing in-house payroll
A company that has passed the point where the director can run payroll in a spreadsheet without risk. Holiday pay, sick pay, allowances and changing rates are where in-house payroll usually goes wrong, and they are routine for us.
Global payroll and HR platforms
Platforms whose clients have their own Latvian entity need an in-country partner to calculate, file and pay. We act as that local payroll partner. How the partnership works →
Payroll pricing in Latvia
Payroll is priced per employee per month on a sliding scale: the rate falls as headcount grows, and each rate applies only to the employees in its band. Prices exclude VAT.
| Employees | Price per employee per month |
|---|---|
| 1st to 5th employee | €16 |
| 6th to 20th employee | €11 |
| 21st employee onwards | €7 |
Payroll only
For a Latvian entity whose only local activity is employment, with bookkeeping done elsewhere. The rates above apply, with a minimum of €49 per month.
| Example | Calculation | Per month |
|---|---|---|
| 2 employees | 2 × €16 = €32, below the minimum | €49 |
| 8 employees | 5 × €16 + 3 × €11 | €113 |
| 25 employees | 5 × €16 + 15 × €11 + 5 × €7 | €280 |
Payroll with accounting
Accounting packages start at €149 per month and include payroll for up to 5 employees. From the 6th employee the rates above apply: a company with 8 employees pays €149 + 3 × €11 = €182 per month. The package covers bookkeeping, VAT and the annual report; the final price depends on document volume and VAT status. Accounting services in Latvia →
Global payroll and HR platforms
Partner platforms pay the same per-employee rates for their clients’ Latvian employees.
Every payroll price includes the monthly calculation, payslips, the employer’s report, employee registration and deregistration, and holiday and sick pay. One-off work, such as correcting a previous provider’s filings, is quoted separately. See all prices →
What the service covers
- Monthly payroll calculation - gross to net, social insurance contributions and personal income tax, with allowances applied where the employee is entitled to them.
- Holiday and sick pay - average earnings calculated to statutory rules, including the split between the employer’s obligation and state sickness benefit.
- The employer’s monthly report - prepared and filed in the Electronic Declaration System by the 17th of the following month.
- Registering and deregistering employees - filed with the State Revenue Service before the person starts work, and on departure.
- Payslips - issued to employees, in Latvian or English.
- Payment instructions - a payment file or a schedule of amounts and deadlines, so the company knows exactly what to transfer and when.
- Group reporting - monthly payroll cost in the format the parent company uses, alongside the statutory filings.
The monthly payroll cycle
- Before the run. The company reports hires, leavers, absences, holidays and sick leave certificates.
- Early in the month. Payroll is calculated for the previous month and the figures are agreed with the company.
- By the 17th. The employer’s report for the previous month is filed with the State Revenue Service.
- By the 23rd. Payroll taxes for the previous month are paid into the single tax account.
Salary payment dates are set in the employment contract and are the company’s decision; the filing and payment deadlines above are not.
Latvian payroll in 2026: the numbers
What an employer pays on top of gross pay
Latvian payroll has one employer cost above the gross salary: the employer’s share of state social insurance contributions, 23.59% of gross pay in 2026. A gross salary of €2,000 therefore costs the company €2,471.80 per month before any other benefit. This is the number to use when budgeting a hire, not the gross figure in the employment contract. For a fuller breakdown, see what an employee costs an employer in Latvia.
What is deducted from the employee
- State social insurance contributions, employee’s share - 10.5% of gross pay.
- Personal income tax - 25.5%, applied to gross pay after social contributions and after any allowances the employee is entitled to.
A higher rate of 33% applies to annual income above €105,300. It is not withheld in the monthly payroll run; it is settled through the employee’s annual income declaration.
Allowances that change the net figure
Two employees on the same gross salary can take home different amounts. The allowances below apply only where the employee has filed a wage tax book with the State Revenue Service and named this employer as the place of its application.
- Tax-free minimum - €550 per month in 2026. Unlike the arrangement that applied until 2024, the amount is fixed and is not reduced as income rises.
- Dependant allowance - €250 per month for each dependant.
- Disability allowance - €154 per month for group I or II, and €120 per month for group III.
Where no wage tax book has been filed, none of these apply, and the net figure drops accordingly. This is the single most common source of confusion when a foreign parent compares payslips. To see the effect for a specific salary, use the free Latvia salary calculator with 2026 rates.
Minimum wage
The statutory minimum monthly wage for full-time work is €780 in 2026, up from €740 in 2025. Employment contracts written before the increase need checking against the new figure - the obligation is on the employer, and it is not applied automatically.
Local payroll partner for global payroll platforms
Global payroll and HR platforms pay employees in dozens of countries, but each country’s payroll has to be calculated and filed by someone who knows its rules. For Latvia, SMAIDA can be that in-country partner.
- Who it fits. Platforms and their clients where the client has its own Latvian entity and is the legal employer.
- What we do. The Latvian payroll calculation, employee registration, the employer’s report, payslips and the tax payment schedule.
- How results come back. In the file format and on the timetable the platform or the client’s HR team specifies, with Latvian filings kept as the legal record.
- Who answers questions. One licensed accountant, in English, for both the platform team and the client.
We do not act as an employer of record. If the client has no Latvian entity, the platform’s own employer-of-record service is the right route; once the client sets up an entity, payroll can move to us. Platform teams can book a call about a partnership.
Switching payroll provider
Most new clients come from another provider or from in-house payroll. The switch is planned so that no month is filed twice or missed.
- Data handover. Employee records, year-to-date payroll and open holiday balances are taken over and checked, not copied blindly.
- Clean start date. We take over from the start of a reporting month, so each filing has one owner.
- First run checked twice. The first payroll is reconciled against the previous provider’s last run before anything is filed.
Employment basics a foreign employer should know
- Registration before the start date. An employee has to be registered with the State Revenue Service before starting work, not after the first payroll run.
- Annual leave. The statutory minimum is four calendar weeks of paid leave per year, in addition to public holidays.
- Sick leave. The employer pays for the first days of incapacity; after that the state pays sickness benefit. Both parts are calculated from average earnings as part of the payroll run.
- Written contracts. An employment contract must be in writing before work begins.
Filing and payment dates for the whole year are in the Latvia tax calendar 2026. If you are still choosing a legal form for the Latvian entity, see business form and tax regime in Latvia.
What payroll outsourcing is not
This needs saying plainly, because the two services are often confused when a company is hiring in a country for the first time.
Payroll outsourcing means the company employs the person itself, under its own Latvian entity, and an accountant calculates and reports the payroll. The employment relationship, and the obligations that come with it, stay with the company.
An employer of record is a different arrangement: a separate provider legally employs the person on the company’s behalf, so no Latvian entity is required. That is not the service described here, and it is not one SMAIDA provides.
If the company already has a Latvian entity - or is setting one up - payroll outsourcing is the relevant service. If it does not intend to have one, an employer of record is the right thing to look for, and it is worth comparing that cost against the cost of running a small entity before deciding.
What the employer provides
- Employee data before the start date - the employment contract, personal identity details and the agreed salary.
- Absences on time - holidays, sick leave certificates and unpaid leave, before the payroll run rather than after it.
- Notice of leavers - with the termination date and the reason, since these affect the final settlement.
- A named contact - one person to confirm the figures each month.
Payroll is the part of accounting with the least tolerance for late information. A document that arrives after the run means either a correction or an employee paid the wrong amount.
For the full accounting cycle - bookkeeping, VAT and the annual report - see accounting services in Latvia.
Frequently asked questions
How much does payroll cost in Latvia?
Payroll is priced per employee per month on a sliding scale: €16 for each of the first 5 employees, €11 for the 6th to 20th employee and €7 from the 21st, with a minimum of €49 per month for payroll only. For example, 8 employees cost €113 per month. Accounting packages from €149 per month include payroll for up to 5 employees. Prices exclude VAT.
What does an employee cost an employer in Latvia?
Gross salary plus the employer’s share of state social insurance contributions, which is 23.59% in 2026. A gross salary of €2,000 costs the company €2,471.80 per month.
What is deducted from an employee’s gross pay?
State social insurance contributions of 10.5% and personal income tax of 25.5%, the latter applied after social contributions and any allowances. A rate of 33% applies to annual income above €105,300 and is settled in the annual declaration, not monthly.
What is the minimum wage in Latvia in 2026?
€780 per month for full-time work, up from €740 in 2025.
When are payroll taxes due?
The employer’s report is filed by the 17th of the following month, and the taxes are paid into the single tax account by the 23rd.
Can a foreign company run payroll in Latvia without a Latvian entity?
Not through payroll outsourcing. Payroll outsourcing assumes the company employs the person under its own Latvian entity. Employing without a local entity requires an employer of record, which is a different service and is not provided by SMAIDA.
Do you work as a local payroll partner for global payroll platforms?
Yes, where the end client has its own Latvian entity. SMAIDA runs the in-country payroll, statutory filings and payslips, and returns the results in the format the platform or the client’s HR team specifies. SMAIDA does not act as an employer of record.
Can payroll be handled in English?
Yes. Correspondence, payslips and reporting to a parent company are available in English. Statutory filings are submitted in Latvian, as the law requires.
Is SMAIDA a licensed payroll provider?
SMAIDA Solutions, SIA is an outsourced accountant licensed by the State Revenue Service of Latvia, licence No. AGL0003786. The licence can be checked in the public register of the State Revenue Service.
How is data protection handled?
Payroll data is processed under the General Data Protection Regulation. Access is limited to the company’s authorised people and the service provider.
When can the service start?
New engagements normally start with the next reporting month, so that filings are not split mid-period. Switching from another provider is handled as part of the service.