How To Open A Company In Latvia
2023 09 15
Just like most processes in the entrepreneurial journey, opening a company is not something you carry out on a whim. Considerable thought and preparation go into such an endeavor. Nevertheless, it is not like moving a boulder up a hill. It is doable.
Latvia is a European country with one of the fastest economic growths and a good business environment. Therefore, running a company in Latvia is a great idea. However, like most countries, it has specific procedures, regulations, and laws you should know before starting this process.
Let’s find out what it takes to open a company in Latvia.
Opening a company in Latvia
Opening a company in Latvia is a relatively straightforward process. There are different company types, most of which follow some basic principles, so before doing it, do your research and choose what works the best for you.
In Latvia, you can register your company at the Latvian Enterprise Register. Like all other state institutions, it accepts documents only in Latvian, which can be a problem for a foreigner.
However, if you are one, you can solve this by using the professional services of a law office or hire a company that specializes in company registration in Latvia and accounting services. Many law offices and specialized company registration companies offer services for company registration in Latvia, but they are essentially the middlemen in this process.
Can you open a company in Latvia online?
Opening a company online is possible in many countries worldwide, including Latvia. It doesn’t differ that much from the physical process – you must complete the required documents and verifications according to the regulatory standards.
How to open a company in Latvia for foreigners?
Latvian regulations encourage foreigners to open their companies in the country. A foreigner doesn’t need to relocate or reside in Latvia to run it. Once the necessary documents and procedures are completed, they can open and run a company in Latvia.
Some business service providers will only require your presence as a foreigner for notarisation's sake, which could take only a day.
Is it easy to start a business in Latvia?
The process of opening a company in Latvia is straightforward. Once the required documents are provided, and the fees are paid, it is simple to start a company.
What you need to open a company in Latvia
To successfully open a company in Latvia, you need to get familiar with the process and prepare to complete the necessary steps.
Here’s what they are.
1. Choose a legal structure
Determine your company's legal structure, whether it will be a Limited Company (SIA), Joint-Stock Company (AS), or another entity type. This decision will have implications for your ownership, liability, and taxation, so think it through.
2. Company name
Select a unique company name. Once you have one, you can check the availability of your desired name with the Latvian Enterprise Register.
3. Registered office
You will need a registered office address in Latvia. This address will be the official location of your company, proving that your company exists in Latvia.
4. Share capital
Determine the share capital required for your chosen legal structure. For example, a limited liability or SIA typically requires a minimum share capital of 2,800 EUR. However, as a private person, you can open a limited liability with an insignificant share capital of 1 EUR.
5. Company documents
Prepare the necessary documents, including articles of association, a memorandum of association, and other required paperwork. These documents should be in Latvian. This step has been a hurdle for foreigners, yet again, you can always seek assistance from professionals who can help you with translations.
6. Submit documents
Once you have everything ready, you can then submit your documents to the Latvian Enterprise Register. If you are uncomfortable doing this in Latvian, local law firms or company registration services can assist you with the submission process.
7. Registration fees
Be prepared to pay registration fees. The amount will depend on various factors, including your chosen legal structure.
8. Bank account
Open a bank account for your company. Many international and local banks operate in Latvia, and you can choose one that suits your needs.
9. Tax registration
Register for tax purposes with the Latvian State Revenue Service. This process is a crucial step to ensure compliance with tax regulations.
As a business owner, it is essential to stay current with your taxes; otherwise, you may be committing a serious crime with stiff penalties.
10. Additional permits
Depending on your business activities, you may need specific licenses or permits. Check the requirements for your industry.
11. Annual reporting
Be aware of the annual reporting and compliance obligations for your company. This step includes submitting financial reports and other documents to relevant authorities.
While it is possible to go through this process yourself, working with a local law firm or business service provider who understands the intricacies of Latvian regulations and can assist with submitting documents in Latvian may simplify the process and help ensure compliance.
Finally, ensure you are well-informed about Latvia's legal and tax requirements, which can vary depending on your business activities and legal structure. Consulting with a legal professional or business advisor with expertise in Latvian company registration is highly recommended.
How much does it cost to set up a company in Latvia?
Opening a company in Latvia requires the payment of registration fees. The amount will depend on various factors, including your chosen legal structure.
Entrepreneurs considering registering a company in Latvia should carefully consider the costs involved. Here are the expenses that must be considered:
How to open an SIA in Latvia?
In Latvia, a Limited Liability Company, commonly called "Sabiedrība ar ierobežotu atbildību" or "SIA," is the most popular form of corporate organization. If you are going to register an SIA, you must understand the requirements and follow the procedures.
Here are some critical steps when registering an SIA in Latvia:
How do you register as self-employed in Latvia?
In Latvia, individuals can register as self-employed if they are engaged in economic activities. These economic activities can encompass various types of work and services.
It's important to note that self-employed individuals are responsible for managing their business affairs, including tax obligations and compliance with relevant regulations. Registering as self-employed allows individuals to conduct economic activities independently and may offer more flexibility in their work arrangements than traditional employment.
However, individuals considering self-employment in Latvia should know the legal and tax requirements associated with their chosen economic activities and seek professional advice to ensure compliance with Latvian regulations.
Summary
If you have all the documents required by the Latvian Enterprises Regulations ready, opening a company in Latvia is not that complicated.
As a foreigner or a Latvian indigene and resident, opening a company and running a business in Latvia is, by most accounts, a seamless process. Latvia maintains a business-friendly environment through its policies and institutions, so the most difficult part can be to take that first step.
