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Tax payment process from capital growth to change in Latvia

As part of the tax reform, changes will be added to the Personal Income Tax Law starting from 1 January 2018. One of the changes is associated with payment and declaration of income from capital growth. The tax rate and the term for submission of declarations on income from capital growth will change next year.

If transactions involving capital assets are commenced but not concluded before 31 December 2017, income from capital growth will remain at the current rate – 15%, BNN was told by State Revenue Service (SRS).
 

Starting from 2018, the term for submission of declarations on income from capital growth will depend on the income gained in a specific quarter. If a person’s (Latvian resident) income from transactions using capital assets in a quarter exceeds EUR 1,000, the declaration will have to be submitted once a quarter before the 15th of the same month after the quarter when income from capital growth was gained.
 

If a person’s total income from transactions with capital assets does not exceed EUR 1,000 in a quarter, the declaration will have to be submitted before 15 January of the following year, SRS explains.
 

The service also notes that next year income from capital, including capital growth, will be applied with 20% tax rate. The calculated tax amount will have to be paid to the state budget no later than 15 days from the day of submission of declaration on income from capital detailed in the law.
 

«For example, if a person’s income from transactions with capital assets in Q1 2018 exceeds EUR 1,000, the declaration will have to be submitted before 16 April 2018. To the budget, the tax will have to be paid before 2 May. But if a person’s income from such transactions in Q1 2018 does not exceed EUR 1,000, the declaration will have to be submitted before 15 January 2019 and tax will have to be paid before 30 January 2019,» SRS explains.

BNN

16-12-2017
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