This practical guide on LLC company registration in Latvia will explain how to form a limited liability company (SIA) in Latvia. It covers all eligibility requirements and advantages, a comprehensive incorporation roadmap with step-by-step actions, necessary documents, payroll and tax obligations after registration, timelines and costs, common mistakes, and a thorough compliance checklist to avoid delays. Latvia’s Enterprise Register and State Revenue Service serve as the citing sources; hence, the information is trustworthy.

Can You Register an LLC in Latvia?

Yes, you may register an LLC as a Limited Liability Company (SIA) in Latvia. It is one of the most common forms of business entities in the country. It is available to both residents and non-residents; hence, foreign business people often prefer it. The country does not have stringent nationality and residency restrictions on the founders, which makes the jurisdiction very easy to navigate in comparison to other European countries.

In Latvia, forming an LLC requires a minimum share capital investment of EUR 2,800 for a standard SIA, which can be lowered to EUR 1 for a micro SIA (special small-capital company type). For convenience, the entire incorporation process can be completed online through the Latvian Enterprise Register, which is beneficial for foreign business owners.

Unique Insights:

  • 100% foreign ownership of an LLC is permitted.
  • No obligation for the founder to reside in Latvia.
  • A registered local office address is mandatory.
  • Share capital deposit can be made with Latvian banks or some fintech providers.
  • Documents can be submitted in 3–5 days for completion.
  • Entrepreneurs benefit from relaxed tax rules, which include no corporate tax on retained earnings.

Advantages of Forming an LLC in Latvia

LATVIA is one of the EU and friendly countries for business, it is very simple and very good for setting up an SIA business. The SIA, or Limited Liability Company, is a common company structure in Latvia, which is preferred due to the liability protection it offers its shareholders. The personal property of shareholders is not at risk with company debts and obligations, which is a plus not only for local but also for international business owners.

Latvia offers a special benefit from a tax point of view – no corporate income tax on retained or reinvested earnings. The tax is only applied upon distribution of profits in the form of dividends which fosters reinvestment and growth. Also, small businesses may take advantage of lower share capital requirements under the micro-SIA structure.

Insights:

  • EU Membership Benefits: Latvian companies benefit from the entire European Single Market with more than 500 million consumers.
  • Grants and Incentives: The Latvian government and the EU often provides grant funding, as well as R&D and innovation support, for SMEs.
  • Prime Location: Latvia serves as a logistics hub amid Western Europe, Russia, and Scandinavia.
  • Business Operations: Latvia has a good reputation with the World Bank as a fast company registration country, offering digital services.

Latvia is now a more attractive option for entrepreneurs looking for expansion in Europe.

Steps to Register an LLC in Latvia

Setting up a Limited Liability Company Latvia is a clear-cut process when you keep an eye on the details. Here’s a step-by-step guide to move you, especially if you’re a foreign citizen, from idea to registration.

Step 1: Choose a Company Name

  • Pick a name that is not already on record with the Latvian Commercial Register.
  • The chosen name must follow local rules—so avoid anything that is confusing, offensive, or might mislead customers.
    Tip: Use the online name-check tool on the Latvian Enterprise Register website to make sure your name is free before you go any further.

Step 2: Prepare Founding Documents

  • Write the Articles of Association. This paper explains how the company is run, the rights of the shareholders, and the management rules.
  • If more than one person starts the business, you’ll also need a Memorandum of Association.
  • You need proof of the share capital payment. This is at least €2,800 for a regular LLC, or only €1 for a micro-SIA that has limits.

Step 3: Register Share Capital

  • Put your share capital into a temporary business account at your Latvian bank.
  • Bring the bank a simple deposit slip. The bank will give you a confirmation receipt, a must-have for the next step.  

Step 4: Submit Application to the Commercial Register

  • Go to the Latvian Enterprise Register (UR) to submit your application. What to hand in: 
    • Founding documents (from Step 2)
    • Bank confirmation (from Step 3)
    • List of shareholders with ID details
    • Proof of the company’s registered address
    • Processing time for your registration usually runs three to five business days as long as your papers are ready.

Step 5: Obtain Tax Registration

  • After you register the company, the system assigns you a taxpayer number automatically. 
  • If the firm’s annual turnover is above €40,000, you need to register also for VAT. 

Step 6: Set Up a Permanent Business Bank Account

  • Transfer the founding share capital from the temporary banking account to a permanent business account once the company is registered.

Quick Tips

  • Translate documents carefully: If your papers are in English, you need certified Latvian translations.
  • Use electronic signatures: Most applications can be submitted digitally if you have a registered e-signature in Latvia, which saves time.
  • Expect some delays:  The biggest hold-ups usually happen when share capital or address proofs are missing.
  • Think about hiring local experts: A Latvian notary or business advisor can speed things up, especially for overseas founders..

With the right prep, you can register your LLC in Latvia in fewer than 7 days

Documents Required for LLC Registration in Latvia

To set up a Latvian LLC (SIA), founders must file a specific group of documents with the Enterprise Register of Latvia (UR). These are:

  • Articles of Association –  this shows the company’s structure, management, and shareholder info.
  • Application Form KR4: Complete and submit this official company registration form.
  • Proof of Share Capital Deposit – Transfer the minimum €2,800 (or just €1 for micro-SIA) into a Latvian bank and grab the bank statement as evidence.
  • Founders’ Identification Documents – Provide a photocopy of your passport or national ID card—colored copies are fine.
  • Proof of Registered Office – Rental agreement, ownership document, or landlord’s consent letter.
  • Board Members’ Consent – Every future board member signs a document where they acknowledge they accept the role.
  • Payment Slip – This is the bank slip or e-receipt for the state fee and official newspaper cost.

Extra Details & Practical Tips

  • Notarization: If the papers aren’t in Latvian, get a translation and a local notary stamp. Many offices finish this in a day.
  • E-signature Option: You can use the eParaksts system to sign papers online, saving a trip to the office.
  • Get a Virtual Office: If you’re abroad, consider a virtual office in Riga. They underline your official address, so the lease is sorted in one go.

Tax Obligations After LLC Registration in Latvia

Once your SIA is up and running, a few tax rules must be followed. Because Latvia promotes reinvested profits, the system is designed to help startup owners.    

  • Corporate Income Tax (CIT): The headline rate is 20%, but you only pay on profit that’s sent out as dividends. If you leave the earnings in the company or reinvest, you don’t pay that 20%.
  • Value-Added Tax (VAT): Latvians charge a 21% Value-Added Tax on sales, but some goods and services enjoy lower rates: 12% and 5%. Businesses must register as VAT payers if their annual sales cross €40,000.
  • Personal Income Tax: Employees pay progressive rates of 20%, 23%, and 31%, based on salary brackets.
  • Social Security Contributions:Employers pay about 23.59%, while employees chip in 10.5%.
  • Other Charges: Small annual state fees apply for company filings, and businesses must pay for accounting services as well.

Perks and Details

  • Latvia retains 0% tax on profits that companies reinvest. This equals or beats Estonia’s deferred corporate income tax and is noticeably better than Lithuania’s 15% tax on all earnings.
  • Free economic zones cut corporate income tax and property tax by as much as 80% in some instances.
  • Investors from outside the EU can tap EU funding schemes and benefit from double tax treaties that cover over 60 countries.

Set Up Your LLC Today with Commenda

Setting up shop in Latvia can be thrilling, but the paperwork for licenses, tax ID numbers, and compliance can slow anyone down. Commenda solves that.

Book a demo with Commenda, We help form your LLC (known as SIA), whether you are an entrepreneur in Riga, a startup in the U.S., or a global investor. From drawing up your incorporation papers to getting your company into the Latvian Enterprise Register, and from registering for VAT to opening tax accounts, Commenda makes it happen fast and accurately.

Why Choose Commenda?

  • End-to-End Support: Get legal papers, tax, and banking all completed in one trusted place.
  • Multilingual Team: Communicate in English, Latvian, or Russian to suit your needs.
  • Speed: Your LLC can be up and running in just 3 to 5 working days.
  • Learned Reputation: More than 1,000 businesses launched with Commenda, and the number is growing.
  • Ongoing Support: We keep your business compliant with annual reports and tax advice.

FAQs

1. What are the ongoing compliance requirements for an LLC in Latvia?
Your LLC must file annual financial statements, keep complete accounting records, and meet all local tax deadlines. Regular shareholder meetings are required, too.

2. Can I register my LLC online in Latvia?
Yes, it is possible to form an LLC online. Simply go to the website of the Latvian Enterprise Register and employ an e-signature, either the e-Signature or an eID.

3. How long does it take to register an LLC in Latvia?
Expect to wait 3 to 5 business days if you send in all the correctly completed paperwork.

4. Do I need a physical office in Latvia to register an LLC?
A registered office address is required. You can hire a virtual office service to fulfill this if you don’t need to actually work in the space.

5. Are there any hidden costs or fees during LLC registration in Latvia?
Besides the state fee, you might pay for notarization, document translation, and possible banking fees when you open the business account.

6. What are the annual filing and reporting obligations for LLCs in Latvia?
Each LLC must file an annual report with the Latvian Enterprise Register. The company must also meet the tax deadlines set by the State Revenue Service, or VID.

7. Can I operate an LLC in Latvia without a local director or shareholder?
Yes, Latvia permits full foreign ownership, and the director does not need to reside in the country.

8. How do I open a business bank account for my LLC in Latvia?
You will show the registration certificate, the articles of association, and your ID. Some banks may also want proof of business activity.

9. What are the benefits of choosing an LLC over other types of business structures in Latvia?
An LLC limits personal liability, allows flexible ownership, offers easier entry to EU markets, and demands a lower minimum share capital than other forms of business.

10. Can I convert my existing business to an LLC in Latvia?
Yes, if you run a sole proprietorship or a partnership, you can shift to an LLC. Just complete the Enterprise Register’s step-by-step conversion process.

11. What happens if I fail to comply with tax obligations after forming an LLC in Latvia?
Missing tax deadlines may result in fines, penalties, interest for late payments, or your business license being put on hold.