Company formation and accounting in Latvia
All companies registered in Latvia must comply with tax and accounting legislation (including the Annual Reports Act).

Recording of transactions.

According to the accounting legislation, a company must record all transactions and maintain accounting ledgers (chronological, systematic and analytical books). Transactions must be recorded in accounting registers during 15 days after the month in which the transaction was made. A limited liability company must record transactions, using double entry recording system. Accounting records must be in Latvian language and should be stored in territory of Latvia.

Cash transactions.

If a company makes (does) cash transactions then the company must maintain a cash book. An employee of a company making cash payments for goods or services must prepare special internal report (list of all cash payments during a month). Depending on total amount of cash transactions with one transaction partner during a month, a company may have an obligation to submit special report to the tax authority. Usually a company has no rights to make cash payments (transactions) if total amount of cash transactions with one transaction partner during a month increases 7200 euro.


Relating to salaries, company must follow certain rules. In Latvian legislation is defined an amount of minimum salary and the minimum hourly rate. An employer also must comply with the legislation requirements related to working hours (standard / normal working hours do not exceed 40 hours per week). An employer must record how many hours an employee has worked and maintain the records.

Source documents.

A company should pay attention to the source documents. According to Latvian legislation, the document can serve as an accounting source document if the document contains certain details. In order a document could serve as value added tax (VAT) invoice and give rights to deduct VAT, the document should contain additional details. A company also must ensure that the issued invoices contain the necessary details.

Accounting reports.

Latvian company until certain term must submit various reports to the State Revenue Service (tax authority).
The main reports (the most widespread reports) are: a declaration on the value added tax and report about salaries and taxes associated with the salaries.
Once a year a company must submit the annual report. Deadline for submission of the annual report depends on the turnover, total assets and number of employees.
Most companies must submit the annual report not later than one month after its approval and not later than four months after the end of the year. Reporting (accounting) year usually coincides with the calendar year.
Reports must be filed using a system of electronic declaration - A person with the rights to sign (a member of a board of directors) concludes a contract about the electronic declaration with the State Revenue Service. After signing the contract the State Revenue Service sends to email ID and password to login in the system of electronic declaration.

A head of a company (usually a member of a board of directors) is responsible for compliance with the tax and accounting legislation requirements.

Accounting services.

DN-NP offers remote bookkeeping services: payroll (salaries calculation), recording transactions in the accounting ledgers, calculation of taxes, tax reports preparation and submission.

The minimum price for accounting services - 70 EUR per month. The price for accounting services depends on the amount of work:
a number of issued and received invoices;
a number of employees;
an amount of fixed assets;
a number of currencies and bank accounts;
cash transactions (cash register, cash expenditures);
a number of debtors and creditors;
net turnover.

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