VAT\GST Returns in Latvia – Where Tourism is Booming

With a population of only 2 million people, Latvia has punched well above its weight class for many years. It’s place in world affairs was confirmed yet again in 2004 when it joined the NATO coalition – a dramatic move for a former Soviet republic.

Even more remarkably, Latvia had the highest tourism growth rate in the EU, attracting 12% more tourists in 2017 than it did the year before. While that rate of growth may not be sustainable for too many years, it’s clear that the boom is just beginning and that the trajectory is pointing in the right direction.

Its location on the Baltic Sea gives Latvia a seaside feel and a surprisingly green landscape, which will appeal to travelers looking for the few pristine areas left in the world. At the same time, Latvia’s capital city, Riga, has long been considered one of the cultural touchstones of the region.

The low prices in Latvia make it a natural location for business travel. The 2.5 million tourists who came in 2017 arrived largely from Russia and German, with the UK, Canada, Israel, Austria, Denmark, and France showing substantial increases in visits during the past year.

That growth is expected to continue. All three countries that topped the tourism growth list – Latvia, Slovenia, and Croatia – were located in Eastern Europe. Long in the shadow of the West, Eastern Europe is breaking through as a tourist attraction of its own, with Latvia well positioned to be one of the top beneficiaries.

VAT\GST Returns in Latvia

With so much foreign travel through Latvia, it makes sense to prepare for VAT\GST returns in the planning stage of a business trip. Today, there is no need to fill out the long and complex forms. All it takes is a phone app to produce a VAT\GST return request in a matter of seconds.

That said, there a number of things to know to do it successfully. For example, you need to know which expenses are eligible for VAT\GST return in Latvia. Every country has its own parameters, and it’s never a good idea to assume that you are eligible for VAT\GST returns in any particular areas.

In Latvia, the list includes accommodation and hotels, taxis/shuttles/buses/trains, conferences, telephone, and even groceries.

The standard VAT\GST rate is 21%. There is a reduced rate of 12%.

Minimums and Time Limits for Recovery

In order to qualify for a VAT\GST return, your application must be at least EUR 400 for a period of less than a year and more than three months. An application for a calendar year or the remainder of a year must be at least EUR 50.

For companies that are based in the EU, applications must be filed by September 30 of the following year. The applications must cover at least three consecutive months in one calendar year and not more than a whole calendar year. An additional claims for the same period can be added later if they meet the minimum requirements and fall within the deadline.

For companies outside the EU, the deadline is also September 30  but only if the claim applies to a calendar year or the remaining months of a calendar year. If the claim period is more than three months long but shorter than a year, then the deadline is three months after the end of the period covered in the claim.

Companies not from EU countries will not be able to make late claims and deadlines will not be extended for them.

Helpful Phrases

Here are some handy phrases to remember whenever making a business related purchase. These will help you ensure you have all the proper documents you need to file your claim.

English
Please give me:

• An original VAT\GST invoice
• With my company name and address
• VAT\GST rate and value shown

Latvian:

Lūdzu dod man:

• oriģinālā PVN rēķina
• Ar manu uzņēmuma nosaukumu un adresi
• Parādīta PVN likme un vērtība

For the complete story on recovering VAT\GST in Latvia and other EU countries, download our eBooks.

Follow us on LinkedIn for news and updates!