Company Formation in Latvia — Register a SIA

Last updated: April 2026.

Latvia taxes retained corporate profits at 0% — the same Estonian-style distribution model that put Tallinn on the map, applied since 2018. Tax falls due only when profits leave the company as dividends, at an effective 25% combined rate (20% CIT on a grossed-up base) or, from 1 January 2026, 15% CIT plus 6% personal income tax for SIAs owned exclusively by individuals. The default vehicle is the SIA — Sabiedrība ar ierobežotu atbildību — registered at the Uzņēmumu reģistrs (Register of Enterprises) in Riga in 1 to 3 working days. Minimum share capital is EUR 2,800 for a standard SIA, or EUR 1 for a small-capital SIA where founders are individuals. Foreign founders can hold 100% of shares with no Latvian residency required.

We form Latvian SIAs end to end: name reservation, articles of association in Latvian, capital deposit, online filing with the Register of Enterprises, UBO registration, VAT registration if needed, and a business bank account introduction. Fixed price, dedicated coordinator, all government fees included.

Quick facts	Value
Corporate Income Tax — retained profits	0%
CIT — distributed profits	20% on gross-up base (effective 25%)
CIT — alternative regime (from 1 Jan 2026)	15% CIT + 6% PIT — natural-person-owned SIAs only
VAT	21% standard / 12% / 5% reduced
VAT registration threshold (resident)	EUR 50,000 annual turnover
Minimum share capital (standard SIA)	EUR 2,800 (50% paid before registration)
Minimum share capital (small-capital SIA)	EUR 1 (individual founders only, max 5)
Minimum directors / shareholders	1 director, 1 shareholder (same person, can be foreign)
Residency requirement	None
Standard formation time	1–3 working days at the Register of Enterprises
Government fees	Included in our packages
Language of filings	Latvian
Currency	Euro (EUR) — Eurozone since 2014

Why Form a Company in Latvia

Latvia sits in a small but strategic seat. EU member since 2004. Eurozone since 2014. Schengen and OECD inside. Three reasons foreign founders pick it.

The 0% on retained profits. Latvia copied the Estonian model in 2018. As long as profits stay inside the company, no corporate tax is owed. A Latvian SIA can compound earnings tax-free for years and only pay tax when shareholders take money out. From 1 January 2026, individual-owned SIAs can opt into a new alternative regime — 15% CIT plus 6% PIT on dividends — making total dividend tax friction lower than the standard 25% effective rate. This is the most aggressive deferral structure in the EU outside Estonia itself.

EU access at Baltic cost. A Latvian SIA invoices freely across the Single Market under reverse-charge VAT, accesses the Parent-Subsidiary Directive for tax-free intra-group dividends, and benefits from the Interest and Royalties Directive. Riga's corporate-services labour market is materially cheaper than Tallinn or Helsinki, and the country's legal system runs on EU directives rather than common-law quirks. Banking, accounting, and legal fees in Riga sit roughly 30% below comparable Nordic cities.

Operational depth in the Baltics. Latvia is the geographic and logistical centre of the three Baltic states. Riga port handles more cargo than Tallinn or Klaipėda. The country has a strong tech ecosystem — Printful, Mintos, Lokalise — and an active fintech regulator at the Bank of Latvia. Entities here often act as Baltic regional holding companies, anchoring operations in Estonia and Lithuania underneath.

The trade-offs: filings are in Latvian (we handle this), Latvian banks tightened non-resident onboarding sharply after the 2018 ABLV crisis, and the standard CIT effective rate of 25% on distributions is higher than the Polish or Cypriot headline rates if you plan to push profits out quickly.

Company Types Available in Latvia

The Latvian Commercial Law recognises six main forms. For 95% of cf24 clients, the SIA is the right answer.

SIA (Sabiedrība ar ierobežotu atbildību)

The Latvian private limited company. Limited liability up to the share capital. Standard minimum share capital is EUR 2,800, with at least 50% (EUR 1,400) paid into a temporary bank account before registration and the balance contributed within the first year. One shareholder and one director are sufficient — both can be the same person, both can be non-residents, both can be foreign companies. Annual filings go to the Register of Enterprises and the State Revenue Service (VID). Audit is mandatory only above two of the following thresholds: turnover above EUR 1.6m, balance sheet above EUR 800k, or 50+ employees.

Small-capital SIA (Mazkapitāla SIA)

A reduced-capital variant of the SIA where share capital can range from EUR 1 to EUR 2,799. Founders must be individuals only (no corporate shareholders), with a maximum of five founders per small-capital SIA, and each founder may participate in only one such company. A 25% reserve from annual net profit is required until the company reaches the standard EUR 2,800 capital. Often used for solo consultants and early-stage one-person tech businesses.

AS (Akciju sabiedrība — Joint-Stock Company)

For larger and listed businesses. Minimum share capital is EUR 35,210, paid in cash only. Mandatory supervisory board and statutory audit. Use the AS if you plan to list on Nasdaq Riga or raise from regulated public markets.

PS and KS (Pilnsabiedrība and Komandītsabiedrība)

General partnership (PS) — two or more partners with joint and several unlimited liability. Limited partnership (KS) — one or more general partners with unlimited liability and limited partners with capped exposure. No minimum capital. Used for professional partnerships and certain investment-fund structures.

IK (Individuālais komersants — Sole Trader)

A registered sole proprietorship with simpler tax treatment but personal liability. Not used by foreign founders.

Branch (Filiāle)

A foreign company's Latvian branch. Not a separate legal entity — the parent's balance sheet and liability extend to the branch. Used when a foreign group needs Latvian presence without a separate sub.

Form	Min capital	Liability	Tax	Common use
SIA	EUR 2,800	Limited	CIT (0% retained / 25% distributed)	Default — SMEs, holdings, foreign subs
Small-capital SIA	EUR 1	Limited	CIT	Solo founders, micro-business
AS	EUR 35,210	Limited	CIT	Listed cos, regulated entities
PS / KS	None	Personal / mixed	PIT (members)	Professional partnerships
IK	None	Personal	PIT	Sole traders
Branch	n/a	Parent's	CIT on LV-source income	Foreign group presence

If your timeline is urgent and you cannot wait for a fresh registration, our sister brand offers pre-incorporated Latvian SIA entities — already registered with the Uzņēmumu reģistrs and transferable in days.

Step-by-Step Formation Process

A typical SIA formation through the Register of Enterprises follows these steps.

Name reservation and registry check. We confirm the proposed name is available and contains the mandatory "SIA" suffix. Two or three alternatives is normal — Latvian naming rules block protected words ("bank", "insurance", "Latvia", "republic") without authorisation.

Articles of association. We draft the statūti and dibināšanas līgums (memorandum of association) in Latvian. Standard SIA statutes are a fixed template; bespoke share classes, dividend preferences, or transfer restrictions can be added with notarial certification.

KYC and shareholder documentation. Each shareholder, director, and ultimate beneficial owner provides a passport, address proof, and signed declarations. Foreign corporate shareholders provide apostilled certificates of incorporation and registers of directors. We arrange sworn Latvian translations through certified court translators.

Capital deposit. For a standard SIA, at least 50% of the EUR 2,800 (i.e. EUR 1,400) is deposited into a temporary capital account at a Latvian bank. The balance is contributed within the first year. For a small-capital SIA, the capital is paid in full at incorporation.

Filing with the Register of Enterprises. The application goes to the Uzņēmumu reģistrs through its online portal. Signing requires a qualified electronic signature — eParaksts (the Latvian national QES) or any EU eIDAS-compliant signature. We provide eParaksts for non-resident directors as part of the package, or coordinate filing under power of attorney where the director cannot create a QES.

Registry decision. Standard timing is 1 to 3 working days from a complete filing. The Register of Enterprises issues the company registration number and confirmation. The Latvian tax ID is assigned automatically.

Post-incorporation registrations. We submit the UBO declaration to the Register of Enterprises within the 14-day deadline, open the corporate bank account, register for VAT if turnover or activity requires it, and elect the alternative 15%/6% CIT regime if shareholders are individuals only and the structure suits it.

End-to-end timeline from KYC clearance to operating company with bank account is usually 7 to 14 business days. The Register entry itself lands on day 2 or 3; the bank typically takes the longest, especially for non-resident-controlled SIAs without local economic substance.

Required Documents

For each shareholder, director, and ultimate beneficial owner:

Passport or EU national ID (notarised copy for non-resident directors signing remotely)
Proof of residential address dated within three months
Latvian personal code (for residents) or foreign tax ID (for non-residents)
Signed declarations: criminal record certification, beneficial ownership

For corporate shareholders:

Apostilled certificate of incorporation
Apostilled extract from the parent company's register of directors
UBO declaration tracing ownership up to natural persons
Sworn Latvian translation of all foreign documents (we arrange via certified court translator — required by the Register of Enterprises)

You also confirm the registered office address (we provide one in Riga if you do not have your own Latvian address), the share capital allocation, and the NACE codes describing business activities.

Costs and Timeline

Latvian formation costs depend on whether you use a standard SIA or a small-capital variant, whether you need a notarised statute or the Register's standard template, and whether ongoing accounting is part of the engagement (mandatory monthly VAT and annual CIT-EUR returns through VID's EDS portal).

Our packages cover the full incorporation through the Register of Enterprises, all government fees and notarial costs, registered office for year one, eParaksts qualified e-signatures for non-resident directors, certified Latvian translation of foreign documents, capital account setup, UBO filing, VAT registration, bank account introduction, and the first month of accounting setup. Same-day Register filings are available for an additional government premium that we include in expedited packages. Contact us for a fixed-price quote — there are no hourly bills and no extras invoiced after the fact.

Typical timeline from KYC clearance:

Day	Milestone
0	Engagement, KYC submitted
1–2	KYC cleared, Latvian articles drafted, eParaksts issued, foreign documents translated
3	Capital deposit and Register filing submitted
4–6	Register of Enterprises decision (LV tax ID issued automatically)
6–8	UBO declaration filed, VAT registration if applicable
8–14	Bank account opened (variable per bank, typically requires director branch visit for non-resident-controlled SIAs)

Tax Overview for Latvian Companies

Latvian corporate taxation is unusual in the EU. There is no annual tax on profits — only on distributions.

Corporate Income Tax: 0% on retained profits. While profits stay in the company, no CIT is owed. This applies indefinitely. There is no "use it or lose it" deadline.

CIT on distributions: 20% on a grossed-up base, effectively 25%. When the company pays a dividend, the taxable base is the dividend amount divided by 0.8, and 20% is then applied. Net effect: paying out EUR 80,000 to a shareholder triggers EUR 20,000 of CIT — a 25% effective rate on the cash distributed. The CIT is the company's liability, not the shareholder's.

Alternative CIT regime (from 1 January 2026): 15% + 6% PIT. SIAs whose shareholders are exclusively natural persons can opt into a new regime. Distributions are taxed at 15% CIT at the company level plus 6% personal income tax withheld at distribution. Combined effective rate of around 20% — meaningfully lower than the standard 25%. This is one of the most material 2026 changes for owner-managed Latvian SIAs.

Withholding tax is the standout feature. Dividends to non-residents: 0% in the standard case — Latvia does not impose WHT on outbound dividends to non-residents (with the narrow exception of recipients in jurisdictions Latvia lists as low-tax / no-tax, taxed at 20%). Interest and royalties to non-residents: 0% in the standard case, again 20% only to listed tax-haven jurisdictions. Management and consulting fees: 20% WHT, reducible to 0% under most of Latvia's 60+ double-tax treaties with a valid residence certificate.

VAT: 21% standard. Reduced rates of 12% (fresh fruits and vegetables — made permanent in 2026; certain hospitality and medical) and 5% (books and media in EU/OECD/national languages). A pilot 12% rate applies to bread, milk, poultry, and eggs from 1 July 2026 to 30 June 2027. Mandatory VAT registration threshold for resident businesses is EUR 50,000 in annual turnover; non-residents have a zero threshold; foreign digital service providers face a EUR 10,000 trigger from 2026.

E-invoicing: Latvia has required B2G (business-to-government) e-invoicing through the eAddress platform and Peppol BIS Billing 3.0 since 1 January 2025. The B2B e-invoicing mandate was originally planned for 2026 but has been postponed to 2028 to give SMEs more time. Voluntary B2B e-invoicing through eAddress opens on 30 March 2026.

Capital gains on share sales by Latvian companies are generally subject to the same distribution-based system — gains are tax-free until distributed. A participation exemption applies to qualifying intra-EU holdings under the Parent-Subsidiary Directive.

Real estate tax runs at 0.2% to 3% of cadastral value depending on use. Property held by SIAs is reported separately.

Banking for Latvian Companies

Latvian business banking changed significantly after 2018. The collapse of ABLV Bank that year and the subsequent AML reforms tightened non-resident onboarding across the entire sector. Today, the four main universal banks dominate, and pure non-resident shells without local connection rarely get accounts.

Swedbank is Latvia's largest retail and corporate bank, Swedish-owned, with the deepest branch network in Riga and the regions. Standard mainstream choice for resident-controlled SIAs and SIAs with a Latvian-resident director or accountant. Onboarding for non-resident-controlled companies requires a director branch visit and clear evidence of Latvian or Baltic operational substance.

SEB Banka is Latvia's second-largest bank, also Swedish-owned, with a dedicated international corporate desk that handles cross-border holding structures and EU group treasury. Comparable onboarding requirements to Swedbank.

Luminor Bank was formed from the Baltic operations of Nordea and DNB. Pan-Baltic by design — one Luminor relationship covers Latvia, Lithuania, and Estonia from a single platform. Strong fit for groups operating across all three Baltic states.

Citadele Banka is the largest Latvian-owned bank and the most digital. Mobile-first onboarding, modern API for accounting integrations, comparatively flexible on small-cap SIAs.

For non-resident-controlled SIAs without obvious local substance, three smaller specialist banks remain options under tighter compliance: BluOr Bank (rebranded from BlueOrange), LPB Bank (Latvian Postal Bank), and Rietumu Bank. All three accept non-resident corporate clients but ask for substantial documentation, source-of-funds evidence, and ongoing transaction monitoring.

EMI alternatives: Wise Business and Revolut Business offer fully remote onboarding for Latvian SIAs and integrate cleanly with EU SEPA and SWIFT networks. Paysera, a Lithuanian-licensed EMI popular across the Baltics, is a third common choice. EMIs are the fastest path for non-resident-controlled SIAs where no Latvian substance exists. They do not provide overdrafts or lending, so businesses needing credit lines should pair an EMI with a Latvian bank for borrowing capacity.

The connection-requirement rule is the single most important practical point: since 2018, Latvian banks expect every business client to have a real reason for a Latvian account. Local employees, a Riga office, contracts with Baltic customers, or a Latvian-resident director are all acceptable forms of substance. Without one of these, the EMI route is the realistic option.

Frequently Asked Questions

Can a foreigner open a SIA in Latvia?

Yes. Latvian Commercial Law imposes no residency, citizenship, or work-permit requirement on shareholders or directors of a SIA. A non-resident foreigner can be the sole shareholder and sole director from day one. The only practical adjustment is that filings with the Register of Enterprises require a qualified electronic signature, which we issue (eParaksts) for non-resident directors as part of our standard package, or we file under power of attorney.

How long does it take to register a Latvian SIA?

Registration at the Uzņēmumu reģistrs (Register of Enterprises) is typically completed within 1 to 3 working days of a clean online filing. Including KYC, articles drafting in Latvian, eParaksts issuance, capital account opening, and certified translation of foreign documents, our typical end-to-end timeline is 7 to 14 business days from first contact to a fully operational company with a bank account opened.

What is the minimum share capital for a Latvian SIA?

Standard SIAs require EUR 2,800 in share capital, with at least 50% (EUR 1,400) deposited into a temporary capital account before registration and the balance contributed within one year. Small-capital SIAs allow share capital from just EUR 1, but founders must be individuals only (maximum five), and 25% of annual net profit must be reserved until the standard EUR 2,800 is reached.

How does the 0% corporate tax on retained profits work in Latvia?

Latvia adopted an Estonian-style distribution-based CIT in 2018. Profits retained inside the company are taxed at 0% — indefinitely. Tax falls due only on distribution, at 20% on a grossed-up base (effective 25%). From 1 January 2026, SIAs owned exclusively by individuals can opt for an alternative regime: 15% CIT plus 6% personal income tax on dividends.

What is the corporate tax rate in Latvia?

The standard CIT rate is 20% on a grossed-up base, producing an effective 25% rate on cash distributed as dividends. Profits retained in the company are taxed at 0%. From January 2026, a new alternative regime allows individual-shareholder SIAs to pay 15% CIT plus 6% PIT on distributions instead — combined effective rate around 20% on distributed amounts.

Do I need a Latvian bank account for my SIA?

Latvian law does not require a Latvian bank account specifically — an SIA can operate from any EU bank account. In practice, a Latvian capital account is needed at incorporation to pay in the share capital. After registration, many non-resident-controlled SIAs operate from EMI accounts (Wise Business, Revolut, Paysera) because the four mainstream Latvian banks (Swedbank, SEB, Luminor, Citadele) require local substance under the post-2018 connection rules.

What documents do I need to register an SIA in Latvia?

Each shareholder, director, and beneficial owner provides a passport or EU ID, residential address proof under three months old, and signed declarations. Corporate shareholders provide apostilled certificates of incorporation, registers of directors, and UBO declarations. All foreign documents need sworn Latvian translation. You also confirm the registered office address, share capital allocation, and NACE business activity codes.

Get Started — Form Your Latvian Company

A fixed-price quote in 60 seconds. Register of Enterprises filing in 1 to 3 working days. Bank account introduction included. Alternative 15%/6% CIT eligibility assessed during onboarding if your structure suits it.

Call +48 2222 5 2222 or email [email protected] to start. Most Latvian formations are complete and operating with a bank account or EMI within 14 business days.

Looking at the Baltics or Nordics more broadly? We also handle Lithuanian UAB formation, Estonian OÜ and e-Residency setups, Finnish Oy companies/), and Polish sp. z o.o. registrations/) — useful if you are weighing Latvia against its neighbours.

Content prepared by Julia Thompson, Corporate Client Service Specialist. Approved by Tomasz Bielski, Managing Director.