Tax advisers of Grant Thornton have extensive knowledge in the field of value-added-tax, excise duties and customs, both on the national and international level.

  •     Advice on transactions subjected to VAT and other indirect taxes
  •     Ascertainment of the tax rate for cross-border transactions
  •     Preparation of an optimum system for deducting input VAT
  •     Audit of VAT compliance
  •     Registration as taxpayer in Latvia and abroad
  •     Tax accounting and reporting
  •     Advice on special procedures
  •     VAT representation and reporting (including Intrastat)
  •     Refunding of VAT paid in a foreign country

Tax advisers of Grant Thornton have extensive knowledge in the field of value-added-tax, excise duties and customs, both on the national and international level.

We serve to assist our customers in the registration of their business as a VAT payer as well as in the subsequent VAT accounting. We help to determine the right time for the legal person to register as a VAT payer. We aim at preventing needless tax liability, while exercising the legal right to deduct input VAT. We also assist in applying for a refund of the VAT paid prior to the registration.

The obligation to register as a VAT payer may also arise, where a legal person not involved with entrepreneurship (e.g. third sector and public sector) purchases, from a VAT payer of another Member State, an amount of goods which exceeds the established limit, or purchases the intangible services provided by law. This will result in the obligation to pay real VAT on cross-border acquisitions. We have the required knowledge and experience to provide the optimum solution.

Many entrepreneurs in Latvia do business in several EU Member States and often in other countries as well. Grant Thornton has established an international partner network that allows to advise customers in various international aspects of VAT.

    We help to determine if and when the customer has the obligation to register as a VAT payer in a foreign country as a consequence of doing cross-border business. Despite the harmonised VAT regulation in the European Union, there are still various differences in practice, which we have had previous experience with.

    Where the obligation to register as a VAT payer in a foreign country proves inevitable, we can use our partner network to provide the best solution for the registration and the subsequent declaration of VAT outside Latvia.

Value-added-tax is a neutral tax. This means that the corporate VAT liability must correspond to the right to deduct input VAT, i.e. where the company incurs a VAT liability, the company must be granted the right to deduct input VAT. This simple principle is not, however, so straightforward in administrative practice. We have gained the experience to ensure that companies exercise due care in input VAT deduction characteristic to the particular area, especially in case of purchase organisations. There is extensive judicial practice in the exercising of due care, in which we have had an active say in.

In addition to due care, attention must be paid to whether the company has revenue exempted from tax or non-business income in addition to taxable revenue. This is the case for many organisations. The partial input VAT deduction method must be applied for deducting VAT in case of mixed revenue. Our analysis helps to determine the most profitable solution for the customer. In addition to mapping the situation, we have the facility for coordinating with the Tax and Customs Board a solution which satisfies all parties involved, even if this involves proposing a method of input VAT deduction which differs from the provisions of the law.

We also advise customers with respect to the terms and conditions and options for deducting input VAT in areas regulated by special procedures:

  •     sale of real estate and metal waste;
  •     tourism;
  •     electronically provided services;
  •     resale of second-hand goods; auctioning of goods;
  •     VAT accounting in the public sector.
Expert Kaspars Rutkis

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