Individual - Foreign tax relief and tax treaties

Last reviewed - 09 February 2024

Foreign tax relief

Residents are entitled to relief from double taxation under national legislation and effective tax treaties.

Generally, foreign tax paid on income included in the tax base is allowed as a credit against PIT on the basis of documentary evidence of income earned and income tax paid approved by the foreign tax authorities. The tax credit should not exceed the Latvian tax attributable to the income earned abroad.

According to the national legislation, PIT is not applicable on employment income derived and taxed in another EU/EEA member state or in a country that has an effective double tax treaty (DTT) with Latvia. Foreign employment income not taxed attracts Latvian PIT at the progressive rates.

Tax treaties

Latvia has effective DTTs with 64 countries and continues developing its tax treaty network.