VAT Registration in Latvia — When You Must Register and How
Value added tax (VAT) is a consumption tax applied to the value added to goods and services. A company that's a VAT payer charges VAT to its customers and remits it to the state budget, while recovering the VAT it paid on its own purchases.
Key takeaways
The mandatory VAT registration threshold in 2026 is €50,000 per calendar year; the application must be filed with VID by the 15th of the month after the threshold is exceeded (November 30 applies only to the small-overage deferral).
Both monthly and quarterly VAT returns are due by the 20th — the 23rd is the unified tax account's payment deadline, not a return deadline.
From July 1, 2026 to June 30, 2027 (one year), a temporary 12% rate applies to bread, milk, fresh poultry meat, and eggs.
A fiscal representative is not a legal requirement for non-EU companies — it's one of several alternative options.
Registration happens electronically through EDS and typically takes 3–5 business days.
Registration in the VAT payer register can be:
Mandatory — if the company's taxable turnover exceeds a set threshold
Voluntary — if the company chooses to register to recover input VAT or strengthen its credibility
The €50,000 threshold — how to calculate it correctly
As of January 1, 2025, the €50,000 mandatory VAT registration threshold is calculated per calendar year. This means a business owner has to track turnover within that specific calendar year. If the €50,000 threshold is exceeded in a calendar year, the taxpayer must register in the VAT payer register: the registration application must be filed with VID no later than the 15th day of the month following the month in which the threshold was exceeded (Article 59(5) of the VAT Law). If the threshold is exceeded by no more than €5,000, registration may be deferred (see below).
What counts toward the threshold:
VAT-taxable supplies of goods and services in Latvia
VAT-exempt transactions under Article 52, paragraph one, points 20, 21, 22, 24, 25 and 26 of the VAT Law (e.g. real estate transactions, financial and insurance services), unless they're incidental and clearly distinct from the company's regular business activity
What doesn't count:
Sale of fixed assets and intangible investments
The VAT-exempt transactions listed in Article 52, paragraph one, points 20, 21, 22, 24, 25 and 26 of the VAT Law, when they are incidental and clearly distinct from the company's regular business activity
What happens if you miss the registration deadline
If a business owner doesn't register in the VAT payer register on time, VID can apply the tax obligation retroactively. An administrative penalty may also apply.
The small-overage exception
If the threshold is exceeded in a calendar year by no more than €5,000 (i.e. total transaction value does not exceed €55,000), the company may defer registration until the end of that calendar year (Article 59(4) of the VAT Law). In that case the registration application must be filed by November 30 of that year, or by December 31 if the threshold is exceeded only after November 30 (Article 59(6) and (7)).
Special VAT registration regime for small businesses
Starting July 1, 2025, small business owners and sole traders who meet certain criteria can apply for and use a special registration regime within VID's VAT payer register. Persons registered under this regime pay VAT only in specific cases — on services received and/or goods purchased (for example, services from the EU) — but don't have to charge VAT on revenue from selling goods or services in Latvia.
Criteria:
the total value of goods supplied and services rendered within Latvia in the previous and current calendar year hasn't exceeded €50,000
the business doesn't provide services whose place of supply is determined under Article 19, paragraph one of the VAT Law, to taxable persons registered in other EU member states
Voluntary registration — when it pays off
Any company can register as a VAT payer regardless of turnover. Voluntary registration can pay off if the company wants to recover input VAT on its purchases, and it can also strengthen credibility in the B2B market, since business partners can deduct input VAT on the services or goods they receive from you.
The trade-off is administrative burden: monthly or quarterly VAT returns, strict invoicing requirements, and detailed record-keeping.
VAT rates in 2026
Latvia applies four VAT rates:
Rate | Applies to |
|---|---|
21% | Most goods and services: consulting, IT, retail, restaurants, professional services |
12% | Reduced rate: fresh fruit, berries and vegetables (a repeatedly-extended reduced-rate scheme, with the latest extension planned through 2028), heating supplies, medical devices, pharmaceuticals, and passenger transport. For the period July 1, 2026 to June 30, 2027, the 12% rate also applies to bread, cow's/goat's/sheep's milk, fresh/chilled poultry meat, and thermally untreated eggs — after that period these items revert to the standard 21% unless a new extension is adopted |
5% | Reduced rate: books (printed and electronic) and press publications — only in the state language, Latgalian, Livonian or the languages of other EU/EEA/OECD countries; certain special publications |
0% | Export of goods, intra-Community supplies of goods to VAT-registered EU customers, international transport, and certain supplies related to ships and aircraft in international traffic |
VAT exemptions:
Certain financial and insurance services
Healthcare and medical services
Education and professional training
Certain cultural and social services
Residential real estate rental
Exempt transactions don't generate output VAT and generally don't allow recovery of input VAT related to those activities.
Worked example
Say a consulting SIA reaches €52,000 in turnover between January and October 2026 (all transactions at the 21% VAT rate). Since turnover exceeds the €50,000 threshold within the current calendar year, the company must register in the VAT payer register. The threshold is exceeded by €2,000 (i.e. by no more than €5,000), so the company may use the deferral and file the application by November 30; without the deferral, the application would be due by the 15th of the month after the threshold was exceeded.
After registering, the company issues an invoice for a consulting service worth €1,000 (excluding VAT):
Amount | |
|---|---|
Service value (excl. VAT) | €1,000.00 |
VAT (21%) | €210.00 |
Total invoice to client | €1,210.00 |
Of that €210, the company remits to the state budget the difference between the VAT it charged and the input VAT it paid on its own purchases (e.g. office equipment, services). The return for that month is due by the 20th of the following month, while payment of the calculated tax is due by the 23rd.
You can calculate the exact VAT amount for your invoice with our VAT calculator.
How to register — step by step through EDS
Registration in the VAT payer register happens electronically through VID's Electronic Declaration System (EDS).
1. Log in at eds.vid.gov.lv with your e-identity (eID, eParaksts, Smart-ID, or internet banking authentication).
2. Go to "Reģistrācija" ("Registration") → "PVN maksātāju reģistrācijas pieteikums" (VAT payer registration application).
3. Fill in the form.
4. VID reviews the application and issues a VAT registration number in the format LV + 11 digits. Processing usually takes 3–5 business days.
After registration, the company's data becomes publicly available in the VIES database (VAT Information Exchange System), where partners can verify the validity of your VAT number.
Special rules for foreign companies
For foreign companies carrying out VAT-taxable transactions in Latvia, the VAT registration threshold doesn't apply — registration is usually required from the first taxable transaction. For companies from outside the EU, appointing a fiscal representative is not a legal requirement — it's one of several alternative ways to meet VAT obligations, and in practice it's used in specific cases where it simplifies administration. Exceptions/alternatives are also possible through the special OSS scheme.
What changes after VAT registration
Invoices must show the VAT amount. Every invoice must meet the legal requirements: it needs your VAT payer number, the VAT amount shown separately, and the applicable VAT rate.
You must submit VAT returns. VAT-registered companies in Latvia must submit VAT returns regularly. Filing frequency depends on turnover. Returns are filed monthly if taxable turnover in the previous or current tax year exceeds €50,000 (or if certain EU transactions are carried out); all other registered taxpayers file quarterly (VAT Law, Article 115).
VAT return deadline: both monthly and quarterly returns are due by the 20th of the month following the end of the tax period (20 days after the period ends).
VAT payment deadline: the calculated tax must be paid into the unified tax account by the 23rd — a different date from the return deadline.
You must submit EU sales lists (EC Sales Lists). If you transact with EU partners, you must submit a recapitulative VAT statement.
Frequently asked questions
Can I register as a VAT payer if my turnover is below €50,000?
Yes, voluntary registration is available to any company. But carefully weigh whether the benefits (recovering input VAT) outweigh the extra administrative burden.
How long does VID take to review a VAT registration application?
Usually 3–5 business days, though more complex cases, or ones where additional information is requested, can take up to 15 business days.
Can VAT payer status be cancelled?
Yes, VAT payer status can be cancelled if the company no longer meets the criteria for mandatory registration. For companies that registered voluntarily, though, cancellation is only possible after a certain period (usually a year), subject to the conditions set out in law. The application must be submitted through EDS.
Does the VAT registration threshold apply to the self-employed too?
Yes, the threshold applies to self-employed individuals as well. The calculation includes all VAT-taxable transactions.
What happens if I mistakenly leave VAT off an invoice?
If you're a VAT payer but didn't show VAT on an invoice, you're still liable for the VAT due either way — even if the client never paid it.
Does VAT registration also apply to a newly formed SIA?
Yes — the threshold and obligations are the same regardless of the company's age. If you've just registered a company, our SIA registration guide is worth a read too.
How much does an accountant cost who can help with VAT returns?
You can get a precise estimate for your situation on our pricing page or FAQ. See also what we offer under services.
Is the 12% rate on bread, milk, poultry meat, and eggs permanent?
No — it's a temporary rate, in effect from July 1, 2026 to June 30, 2027. After that period, these items revert to the standard 21% rate unless lawmakers adopt a new extension.
Conclusion
VAT registration can look like a bureaucratic procedure, but a properly evaluated, timely step can save both money and headaches. Our team helps business owners assess whether voluntary registration pays off, and prepares and submits the application through EDS. Get in touch.
Sources and references
Last updated: September 2026. This information is based on the Value Added Tax Law and VID's official materials.
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