If an individual resides
in Lithuania for more than 183 days in any calendar
year (or more than 280 days over two consecutive
tax periods), they are deemed resident for tax purposes.
If an individual has a permanent home, or their
centre of economic, personal, or social interest
is in Lithuania then they may be regarded as resident
for tax purposes, regardless of how many days per
year they have spent in the country.
Residents of Lithuania
pay income tax on income derived from within Lithuania
and worldwide. Non-residents pay tax only on income
derived from within Lithuania.
EU/EEA citizens may enter
Lithuania freely to live and work for up to 90 days.
No work permit is required. Such stays may be extended
in certain circumstances. After that, a certificate
confirming right to reside in Lithuania is required.
Non-EU/EEA citizens may first require a visa to
enter the country, although Lithuania is party to
the Schengen Agreement.
Cost
of Residence Document (approx)
Work
Permit Required
Work
Permit Authority
A permanent residence permit will
cost LTL170. A small charge (LTL60) will also be
made for a replacement permit in the event of losing
the permit or making changes to personal data (eg
getting married).
Non-EU/EEA citizens will require
a work permit and a residence permit before entering
Lithuania, if the intention is to work. A work permit
is usually issued for a period of up to two years.
A work permit can be obtained form
the Ministry of Social Security and Labour. However,
it is advisable to apply initially for the permit
via the consular office in a person’s country
of origin, especially if a visa is required to enter
the country and if it is the intention to find work
after the initial 90-day visiting period.
Personal
Income Tax
Corporate
Income Tax
Social
Taxes
Personal Income Tax is levied at
a flat rate of 15%. All individuals are entitled
to an annual tax-exempt allowance of LTL5,640, where
income is less than LTL9600. Additional allowances
are given for dependant children.
Corporate Income tax is levied at
15% on taxable profits. Companies with less than
10 employees and turnover below LTL500,000 (so-called
micro-enterprises) pay tax at the reduced rate of
5%, subject to certain conditions.
Contributions to the state Social
Insurance Fund are mandatory. Employers pay 31%,
whilst employees pay 9% towards pension and health
(withheld from wages). Generally, self-employed
individuals pay a total of 37.5% in contributions
(28.5%, plus 9% health insurance contribution).
Capital
Gains Tax
Property
or Wealth Tax
Stamp
Duty
Capital gains are taxed at 15%, in
line with the personal and corporate income tax
rates.
Profits from the sale of a property
are taxed at 15%. Local municipal authorities levy
a Real Property Tax of between 0.3% and 1% of the
value of a property, or land. There is no wealth
tax in Lithuania.
There is no Stamp Duty in Lithuania,
though a small fee may apply to some contractual
transactions.
Other
Taxes
The standard rate of VAT is 21%.
The threshold for registration for VAT is revenue
exceeding LTL100,000 in the previous 12-month period.
Reduced rates of 9% and 5% apply to certain supplies
and services.
I am facing a dilemma and would like to invite any reader to advise me.
I am a Brit who has lived outside UK since 1993- initially in Belgium (5 years) & subsequently in 4 African countries. After a year outside UK, the UK Inland Revenue confirmed my status as ‘non-resident’ for tax purposes and as I have had no income in UK, I have not completed a UK tax return for many years. I visit UK very rarely, normally for one or two weeks per year.
In May 2011, I was made redundent by my employers, who were downsizing. This coincided with a move to retire in the Netherlands, where I now have official residency (my wife is Dutch). I thought that, at 63 years of age, I would be unlikely to find suitable employment; in fact, I have not tried hard and had resigned myself to permanent (but slightly premature) retirement.
However, to my surprise, I have recently been approached (through a mutual acquaintance) by a company that wishes to use my skills on a project in the Isle of Man. The role, if & when confirmed, would see me working for about 10 days a month in Isle of Man, with about 5-7 additional days per month, working from home. Contract will be for about two years. The firm has asked me to confirm if I would prefer to be paid (and therefore be taxed) in Netherlands or Isle of Man, the idea being that I create a self-employment entity for this employment. I have no data on which to base a response. Given Isle of Man's traditional ‘low tax ‘environment, are there any benefits to declaring an income in IOM? Are there any Isle of Man residency implications? Netherlands takes a tax cut on total world wide income, and, as I have never had any contact with the Dutch authorities, I am reluctant to start such a relationship now. Do I have to declare income in both countries, with a breakdown prorata to the time spent in each jurisdiction? Should I declare income to UK Inland revenue?
If anyone has pertinent advice on these points, I’d be grateful to hear them.
Just wondering if anyone 'on the ground', as it were, might be reading and able to help me...I was considering relocating my hairdressing business from the UK to Ireland before the economy started to go properly belly-up...now, not so much.
Are things as bad as they seem over there, or is it being over-hyped by the media? And is the government still keen to support small business people? Cos if not, I'll look elsewhere...
Hi, I live in South Africa, and along with 2 business partners (one in South Africa and one in Ireland - all South African citizens though) are setting up a company that designs Smart phone applications. As they will be sold on the various platforms (none of which operate out of South Africa)we have to list our company as operating out of Ireland anyway. As such, we have decided to set up our company in the best tax country and are wanting info on whether Jersey or Malta is best? If anyone has some inside info we would really appreciate it!! Thanks!Mary
I am moving full time to France in Jan 2012 where I will be working as a freelance contract engineer to a number of Australian based companies. It is my choice to move to France not a work requirement. I will be renting my house out in Austrlalia and renting a house while I am in France. I hold both EU & Austrlain citizenshiip. I am married with 2 young children. Approx total family income $100k AUD. Do I pay tax in France or Australia or both ? Any help or guidance would be much appreciated.France move
Cyprus
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