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A Latvia company owned from abroad is, almost always, an SIA (sabiedrība ar ierobežotu atbildību), the limited liability company entered in the Commercial Register kept by the Register of Enterprises (Uzņēmumu reģistrs). Owners use it as a trading company in the euro area, as the Latvian subsidiary of a foreign group or as a holding company. What draws them is the tax model: corporate income tax is charged only when profit leaves the company, so whatever the SIA reinvests stays untaxed. Latvia shares that approach with Estonia, while Lithuania taxes profit as it is earned.
Two further features shape the picture. Latvia is one of the few EU states whose beneficial owner register is still open to the public. And since the ABLV Bank case of 2018 the law has barred banks and payment and e-money institutions from serving shell arrangements, so a company’s real link with Latvia matters more at the bank than at the register.
| Latvian form | Who may own it | Capital set by law | Usual purpose |
|---|---|---|---|
| SIA | Individuals or companies of any nationality | Equity capital of at least EUR 2,800, paid before registration | Trading, holding and subsidiary companies; the form sold ready-made |
| Small-capital SIA (mazkapitāla SIA) | One to five individuals, each holding shares in only one such company; every board member must be a shareholder | Equity capital below EUR 2,800, paid in money, with at least a quarter of each year’s profit placed in a reserve | An individual founder or a small team starting with little capital |
| AS (akciju sabiedrība) | Individuals or companies | Equity capital of at least EUR 25,000 | Larger companies raising capital |
How an SIA is registered, online with secure electronic signatures or on paper with notarised ones, is set out on our page about company formation in Latvia.
| Item | Rule in 2026 |
|---|---|
| Profit kept in the company | Not taxed |
| Dividends and deemed distributions | 20%, with the amount first divided by 0.8, so a net dividend bears 25%; non-business expenses and loans to related parties count as distributions |
| SIA owned only by individuals | May apply 15% to dividends instead, dividing by 0.85, since 1 January 2026; PwC notes that 6% personal income tax is then withheld |
| Payments to foreign companies | No withholding on dividends unless the recipient is in a low-tax or no-tax jurisdiction (20%); 20% withheld from payments to non-residents for management and consultancy services |
| VAT | 21% standard, 12% and 5% reduced; registration once domestic supplies pass the EUR 50,000 threshold in a calendar year, and regardless of turnover for services to businesses in other EU states |
| Micro-enterprise tax | Not open to an SIA |
| Sale of shares | No transfer tax on shares; stamp duty is levied on real estate registrations |
| Tax treaties | 64 in force at 30 June 2026; the EU directives apply |
Latvian law sets no residency or nationality test for shareholders or for members of the board (valde), and one non-resident may hold every share and be the sole board member. Board members are natural persons with capacity to act, and each gives written consent stating any legal obstacle to holding office, or that there is none. The company needs a legal address in Latvia, in a building or premises listed in the National Address Register, where it can be reached and has a legal basis to be.
Beneficial owners, every individual with more than 25% of the capital shares or votes or control by other means, are stated when the company is registered and whenever its shareholders or board change, and any other change is reported within 14 days. The register is a module of the Register of Enterprises that has collected these data since December 2017, and Latvia kept it public after the Court of Justice judgment of 22 November 2022: current entries can be viewed by anyone, with the named individuals shown after logging in with a Latvian eID, an e-signature, bank identification or an eIDAS credential.
Every SIA meets a payment service provider before it exists, because its capital goes into an account opened in the name of the company being founded, which need not be at a Latvian bank. For the operating account, Latvian banks look for a real link with Latvia: SEB names that connection as its main condition, Citadele and Luminor aim at companies doing their core business in the Baltic region, and several banks tie remote opening to a Latvian identity document and e-signature, so owners without one often visit a branch. Deposits are guaranteed up to EUR 100,000 per client in each Latvian bank, companies included, while the Latvian branches of foreign banks fall under their home country’s scheme. Our page on bank accounts for Latvian companies sets out each bank’s conditions.
We supply ready-made SIAs and register new ones, draw up the founding documents or the share purchase papers, prepare the applications to the Register of Enterprises and VID, and help the company put its bank application together. Where we have a working contact at a suitable bank, we can introduce you to it; opening or keeping the account is for the bank alone to decide.
SIA abbreviates sabiedrība ar ierobežotu atbildību, a company with limited liability, and its name carries SIA or the full words at the beginning or end. It is a closed company: its shares, the daļas, are not offered to the public. In English it is usually called a private limited company. Shareholders risk only their contributions, except that in insolvency the owners of a small-capital SIA answer jointly up to the difference between EUR 2,800 and the capital paid.
No. Latvia is an EU member state using the euro, its beneficial owner register is open to the public, and every SIA files an annual report that the Register of Enterprises publishes. Latvian law has also barred banks and payment and e-money institutions since 2018 from serving shell arrangements with no real economic activity. Foreign owners come for the tax on distributions, not for secrecy.
A standard SIA can, and it can sit under a foreign parent, since companies may own it; the small-capital form cannot have a corporate shareholder. While the holding keeps its profit, no corporate income tax arises, dividends it pays to foreign companies carry no withholding unless the recipient sits in a low-tax or no-tax jurisdiction, and the EU Parent-Subsidiary Directive and 64 treaties are available, subject to the principal purpose test. The 15% option for dividends is closed while a company is among its shareholders.
Only for particular reasons. A founder with a secure e-signature can register a new SIA online, so a shelf company helps mainly a buyer who needs an older registration date, wants to skip the capital account for a company being founded, or has no e-signature. A VAT number, where the company has one, is fragile: VID may remove a taxpayer that replaces all its officials or reports no transactions for six months. The bank reviews the new owner either way.
Both pay corporate income tax only on distributions, but Latvia grosses the dividend up at 20% while Estonia charges 22/78. An SIA needs EUR 2,800 of equity capital, or less in the small-capital form, against EUR 0.01 per shareholder for an OÜ. An SIA share sale needs a written agreement, an OÜ share sale normally a notary. And Latvia’s beneficial owner register stays public, while Estonia closed its own to general searching on 10 July 2026.
Comparing Latvia with other countries for your company? Send us the planned shareholders and board members and where each of them lives through our contact page, and we will tell you what a new SIA or a shelf company would require. We also answer on Telegram and WhatsApp at +48 663 247 166.