Payroll Tax calculation – Latvia 2020
Payroll Tax calculation – Latvia 2020
To commence payroll tax calculation in Latvia, it should be noted that employer deducts personal income tax in Latvia from salary to be paid to the employee – gross salary. Tax Law in Latvia determines that the payroll tax calculation in Latvia starts from paid payroll tax rate from monthly taxable income, which is:
20% - for monthly income up to 1667 euros;
23% - for the part of the monthly income that exceeds 1667 euros.
If the tax booklet for personal income tax in Latvia has not been submitted to the employer, Tax Law in Latvia notes that the rate of 23% shall be applied even if the gross salary is less than 1667 euros.
Employees, whose payroll tax calculation in Latvia is applied, and who are employed by more than one employer, who adjust tax law in Latvia to payroll tax calculation in Latvia and personal income tax in Latvia, submit the tax booklet to the place of income which is considered to be the main source.
Payroll tax calculation in Latvia explains how the employee shall pay the taxes, to adjust Tax Law in Latvia, from the gross salary through the employer. State social insurance compulsory contributions - in the general case - 11% has been deducted from the wages and gross salary determined to employee to whom payroll tax calculation in Latvia (personal income tax in Latvia) has been adjusted.
Find out how payroll tax calculation in Latvia works by full sample provided here.
To find out more about payroll tax calculation in Latvia, personal income tax in Latvia and Tax Law in Latvia, please contact our lawyers at info@gencs.eu
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