How to Close a Company in Latvia — SIA Liquidation Step by Step
A business has three phases: founding, operating, and closing. If the first two get plenty of attention, the third gets almost none. Yet it's precisely the liquidation process that determines whether a business owner can move on with peace of mind, or end up facing VID debts, creditor claims, and legal trouble. SIA owners often don't realize that even keeping a "dormant" company alive costs money, and closing it incorrectly can create personal liability. In this guide, we walk step by step through how to properly liquidate an SIA in Latvia in 2026.
Key takeaways
The state fees for liquidating an SIA add up to only about €30 — starting liquidation (KR13) costs €30 for standard processing (or €90 for expedited, 1-business-day processing), while deregistration from the Commercial Register (KR14) is free
The creditor claim period is 1 month from the publication of the notice (Article 324(3) of the Commercial Law); the members' decision may set a longer period, and assets may be distributed to the members no earlier than 2 months after the closing report is sent to them
Since 1 July 2023, the notice to creditors is published on the Commercial Register's own website, not in "Latvijas Vēstnesis" — and there's no separate charge for it
You don't have to appoint a separate liquidator — by default, the board carries out the liquidation, unless the members' decision states otherwise
The only safe path is voluntary liquidation with a VID clearance certificate confirming no outstanding tax debt — administrative deregistration doesn't erase tax obligations and can create problems for board members
When liquidation is the right choice
Before starting the process, it's worth considering the alternatives. Liquidation isn't the only way to end a business's operations.
When to close an SIA:
The business no longer has active commercial operations and there are no plans to resume them.
The business has fulfilled its purpose (for example, a specific project is complete and a separate legal entity is no longer needed).
The business can't cover its liabilities and has no realistic prospect of restoring solvency — in this case, an insolvency process should also be considered (it follows a different procedure).
Alternatives to liquidation worth considering first:
Selling the business (selling shares/capital stakes). If the SIA has some value (licenses, contracts, a customer base, a name), it can be sold to another entrepreneur instead of being closed.
Reorganization (merger, division). If the SIA is part of a group, it can be merged into another company.
Administrative deregistration by the Register — happens on the Register's own initiative if an SIA fails to submit annual reports for a long time (8+ months past the deadline). This isn't a recommended route, since it doesn't discharge VID obligations and can create problems for the members down the line.
If you've decided to go with an official closure, proceed with voluntary liquidation.
Two paths: voluntary liquidation and forced deregistration
Voluntary liquidation — a process in which the members decide to close the SIA, determine who will carry out the liquidator's functions, and complete all the steps needed to settle liabilities and remove the business from the Commercial Register. This is the safe, correct path.
Forced deregistration (administrative removal) — if an SIA fails to submit annual reports for more than 8 months past the deadline and ignores warnings from the Register, the Register can remove the business from the register. But in this case:
The SIA's tax debts don't disappear and can pass to the board (joint and several liability of board members).
Bank accounts can be frozen due to a VID order.
It's not possible to close the bank account normally or recover assets.
Bottom line: choose voluntary liquidation even if the business has no assets — it's the cheapest insurance against future problems, and, as you'll see below, it's also considerably cheaper and faster than commonly assumed.
Step by step: the voluntary liquidation process
1. The members' meeting decision
Liquidation begins with a decision by the members (owners). It's documented as minutes of the members' meeting (or, with a single member, a decision). The decision states:
The decision to liquidate the SIA.
Who will carry out the liquidator's functions. Under the Commercial Law, liquidation is carried out by the board by default, unless the members' decision states otherwise — appointing a separate liquidator isn't mandatory. If you do choose someone else (an SIA member, an outside lawyer, or an accountant), the decision states their full name, personal ID number, and address.
The start date of the liquidation (usually the day the decision is made).
Signing: the document must be signed by all members with a secure electronic signature (eParaksts, Smart-ID) or a notarized signature.
2. Application to the Enterprise Register (UR)
The decision to start liquidation must be submitted to UR within 3 days of it being made. The liquidator (or the board) prepares and submits an application to UR for an entry recording the start of the liquidation process (form KR13). The application includes:
A copy of the members' decision.
The liquidator's written consent to the role, if someone other than the board has been appointed.
A copy of the liquidator's identity document.
State fee: €30 for standard processing (1–3 business days), or €90 for expedited processing (1 business day, available to SIAs with 2 or more founders). Filing is done electronically through the UR portal (registrs.ur.gov.lv).
Source: Enterprise Register — Liquidation, stage 1, filing and fees
Once approved, UR makes an entry in the Commercial Register showing that the SIA is in liquidation. From this point on, the word "likvidējamā" ("in liquidation") must be added to the company name (e.g., "SIA ... likvidējamā"). This is mandatory on all documents, invoices, and stamps.
3. Notice to creditors and the claim period
Since 1 July 2023, the notice about the start of an SIA's liquidation is published by the Enterprise Register on its own website (info.ur.gov.lv), not in "Latvijas Vēstnesis" — this changed following amendments to the Commercial Law, and there's no separate charge for the publication. The notice states:
The SIA's name and registration number.
Contact information for submitting claims.
An invitation for creditors to submit their claims within the set deadline.
Source: Latvijas Vēstnesis — as of 1 July 2023, creditor notices are published on UR's website
Under Article 324(3) of the Commercial Law, the creditor claim period is 1 month from the day the notice is published — this is a mandatory waiting period, without which liquidation can't be completed. There's an important nuance, though: the members' resolution may set a longer period (for example, where there are many creditors), but it cannot be shorter than 1 month. In addition, assets may be distributed to the members no earlier than two months after the liquidation closing report and the distribution plan have been sent to them, unless all members agree to an earlier distribution (Article 330(2) and (2.1)). In practice, a dormant or "clean" business with no debts is usually faster than one with active creditors or disputed claims.
Source: Commercial Law, Article 324
4. Settling debts and selling assets
The liquidator (or board) is responsible for identifying all of the SIA's creditors, reviewing the accounting records, and making sure all liabilities are settled. This includes:
Assessing all assets (cash, receivables, fixed assets, inventory) and liabilities.
Selling assets (if needed) to cover debts.
Paying all recognized creditor claims in the prescribed order (tax debts first, then everything else).
If the SIA's assets aren't enough to cover all its liabilities, an application to start an insolvency process must be filed. In that case, the liquidation turns into a different legal process.
5. Preparing the final closing balance sheet
Once the creditor deadline has passed and all liabilities have been settled, the liquidation closing balance sheet is prepared. It reflects the SIA's financial position at the point liquidation is completed: remaining assets, settled liabilities, and the balance available for distribution to members.
6. Distributing remaining assets to members
If assets (cash, property) remain after creditors have been satisfied, they're distributed to members in proportion to their capital shares. There are important tax aspects here:
The amount paid out is treated as a liquidation quota, which is subject to corporate income tax under the 20/80 formula, as deemed distributed profit.
Corporate tax on the distributed assets must be paid, and this affects what kind of VID clearance certificate you'll receive in the next step — VID checks whether this tax has been paid before issuing a certificate confirming no outstanding tax debt.
This is one of the places where business owners often make a mistake — paying money out to themselves without thinking about corporate tax, then running into a VID debt after closing.
7. VID's final report and clearance certificate
The biggest challenge in the liquidation process. For UR to remove the SIA from the register, a VID certificate confirming no outstanding tax debt is required. This means:
Submitting any declarations not yet filed.
Paying off all tax debts (including late fees and penalties).
Calculating corporate tax on the liquidation quota.
Once all obligations are settled, requesting a VID certificate confirming there's no outstanding tax debt.
No fixed statutory deadline is set for issuing this certificate — in practice it depends on how complex the SIA's tax history is and whether VID needs to carry out an additional audit. In simple cases (no debts, a clean filing history), the certificate can be issued relatively quickly; in more complex cases, the process can drag on.
8. Application to UR for removal from the Commercial Register
Once the VID certificate has been received, an application for the SIA's removal from the Commercial Register is filed with UR (form KR14). The application includes:
The liquidation closing balance sheet.
The VID certificate confirming no outstanding tax debt (original or certified copy).
Confirmation that all creditors have been satisfied.
State fee: this application is free of charge.
UR reviews the application and, if everything is in order, makes an entry removing the SIA from the Commercial Register. From this moment, the SIA officially no longer exists.
9. Closing the bank account
Once you've received confirmation of the UR deregistration entry, the SIA's bank accounts need to be closed. The bank will typically request the UR confirmation of deregistration. The account balance is paid out to the members according to the liquidation balance sheet.
The liquidator's (or board's) role and liability
The party carrying out the liquidation — whether that's the board by default or a separately appointed liquidator — is responsible for the entire process from start to finish. Duties include:
Identifying and notifying creditors.
Managing and selling assets.
Organizing the accounting and preparing the final statements.
Communicating with VID and UR.
The liquidator is personally liable for losses caused by their own fault. That's why, if the process is complex or the business has multiple creditors, it's worth bringing in a professional lawyer or accountant — even though the board can formally carry out the liquidation itself.
Costs and timeline
State fees (mandatory, in the simple case):
Item | Amount |
|---|---|
UR fee for the liquidation entry (KR13), standard processing (1–3 business days) | €30 |
UR fee for the liquidation entry (KR13), expedited processing (1 business day, 2+ founder SIAs) | €90 |
Publishing the notice on UR's website | free (since 1 July 2023) |
UR fee for deregistration (KR14) | free |
Total state fees (standard route) | ~€30 |
Additional costs (if needed):
Professional liquidator or lawyer fees: €500–2,000+ depending on complexity.
Accountant's fees for preparing the final statements: €200–500.
Any accrued VID late fees and penalties.
Timeline:
Stage | Duration |
|---|---|
Members' decision | 1 day |
Application to UR (3-day deadline) and the entry being made | 1–3 business days |
Creditor claim period | 1 month (statutory; the members' resolution may set a longer one) |
Settling debts, distributing assets, VID reporting and certificate | a few weeks, depending on complexity |
UR deregistration after receiving the VID certificate | 1–3 business days |
Total estimated time | ~2 months (no disputed claims and all members agree to an earlier distribution) to ~4 months or more (when the 2-month wait after the closing report applies, or there are creditors or a complex tax history) |
In practice, the process can take considerably longer if there are delays with VID, disputes with creditors, or a complicated asset sale.
What happens to personal liability after closing
Once the SIA is removed from the Commercial Register:
Members (owners) are not liable for the SIA's obligations with their personal assets, unless there was malicious conduct, fraud, or personal guarantees involved.
If the liquidation was done correctly — with a VID certificate confirming no outstanding tax debt obtained before deregistration — there's nothing left to collect after closing: there simply is no tax obligation.
The risk to board members remains if the process is "shortcut" — for example, by using administrative deregistration, failing to pay corporate tax on the liquidation quota, or not taking the required steps in an insolvency situation. In such cases, VID can try to collect the unpaid debts from former board members jointly and severally, if it's shown the board didn't act with due care.
That's exactly why it's so important to complete the whole process officially and obtain the VID certificate before deregistering, rather than simply "abandoning" the SIA. An unresolved VID report combined with administrative (rather than voluntary) deregistration is the main reason a business owner can receive a VID claim years later for the debts of a long-"closed" company.
Liquidating an SIA is a process that requires precision, but it's considerably cheaper and simpler than most people think — the state fees add up to only about €30. The key is not to ignore it, and not to rush toward deregistration before receiving the VID certificate. Our team helps both with managing the liquidation process and with preparing VID reports and final statements — so you can close this chapter with peace of mind. Get in touch, or see our accounting services.
Frequently asked questions
Do I have to appoint a separate liquidator?
No. Under the Commercial Law, liquidation is carried out by the SIA's board by default, unless the members' decision states otherwise. A separate liquidator (such as a lawyer or accountant) is appointed only if you choose to — typically in more complex cases.
How long is the creditor claim period?
The statutory period is 1 month from the day the notice is published (Article 324(3) of the Commercial Law). The members' resolution may set a longer period, but not a shorter one. Assets are distributed to the members no earlier than 2 months after the closing report is sent to them, unless all members agree otherwise.
Where is the notice to creditors published now?
Since 1 July 2023, on the Enterprise Register's website, not in "Latvijas Vēstnesis." The change was introduced through amendments to the Commercial Law, and there's no separate charge for the publication.
How much does SIA liquidation cost in total state fees?
In the standard case — about €30 (only for the liquidation start entry; deregistration is free). Additional costs can come from a lawyer, liquidator, or accountant, if you bring one in.
Can I expedite the stage-1 registration with UR?
Yes. Standard processing (1–3 business days) costs €30. Expedited processing (1 business day) costs €90 and is available to SIAs with two or more founders. The second stage (deregistration after liquidation) is free regardless of processing speed.
What happens if debts turn up after liquidation has already started?
The liquidator (or board) needs to assess whether the SIA's assets are sufficient to cover all its liabilities. If not, an application to start an insolvency process must be filed, and the liquidation turns into an insolvency case with a different procedure.
Related reading: how to register a SIA in Latvia and preparing the annual report.
Sources
Last updated: September 2026. Information based on the Commercial Law and official materials from the Enterprise Register and VID. Specific circumstances (debts, a complex tax history, multiple creditors) can change the course and length of the process — consult an accountant or lawyer before making decisions.
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