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In this page: Accounting Rules | Tax Rates | Intellectual Property | Legal Framework | Standards | Business Practices

 

Accounting Rules

Tax Year
The fiscal year begins on January 1st and ends on December 31st of the same year.
Accounting Standards
Commercial undertakings shall perform accounting and prepare financial statements in accordance with Lithuanian Business Accounting Standards (LBAS) which are applicable as of January 1, 2004. Undertakings whose securities are traded in the regulated markets, as of January 1, 2005 shall follow IFRS as adopted by the EU when preparing financial statements.
LBASs can be regarded as simplified and summarized translations of the corresponding IASs or IFRSs.
Accounting Regulation Bodies
AAT
Accounting Reports
Accounting in a company can be performed by an internal accounting department or by a third-party company providing accounting services. Accounting registers can be maintained either as hard copies or in electronic form, but print outs are still required.
Accounting shall be made in LTL and in Lithuanian language.
Financial statements must include: balance sheet, profit and loss account, cash flow statement, statement of changes in equity.
Publication Requirements
Investment companies are required to file their annual statement with the Companies Registration Office.
Professional Accountancy Bodies
LAR , Lithuanian Chamber of Auditors
Certification and Auditing
The Lithuanian Chamber of Auditors is a public legal entity unifying all certified auditors of Lithuania. The Company Law describes conditions under which a company must have its financial accounts audited by a certified auditor: KMPG, Deloitte, Ernst & Young and PricewaterhouseCoopers.
Accounting News
IAS Plus
Business and Accounting news

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Tax Rates

Consumption Taxes

Nature of the Tax
Value Added Tax (VAT) - Pridetines vertes mokestis (PVM)
Tax Rate
21%
Reduced Tax Rate
Reduced rates of 9% apply to public transport, heating and water for residential use.

A further reduced rate of 5% applies to sale and repair of equipment for the disabled and pharmaceutical goods.

A 0% rate applies to exports, insurance and financial services related to export, transport services directly related to the export of goods and goods supplied to another European Union member state.  

Are exempted of VAT: items included in education, healthcare, insurance and financial services, the leasing of dwellings and other immovable property, the sale or transfer of immovable property, and social, cultural, sports, radio and television services if supplied by non-profit seeking entities.

Other Consumption Taxes
Excise duty is imposed on ethyl alcohol and alcoholic drinks, processed tobacco, energetic products, electric energy. More detailed information on excise duties is available concerning alcoholic beverages, tobacco products, energy products on the European Commission website.

Learn more about Service Providers in Lithuania on Globaltrade.net, the Directory for International Trade Service Providers.

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Corporate Taxes

Company Tax
15%
Capital Gains Taxation
Capital gains of resident and non-resident companies are taxed as general taxable income at a rate of 15%.
Main Allowable Deductions and Tax Credits
When calculating the taxable profit of Lithuanian or foreign unit, tax exempt income and allowable deductions are deducted from income.

Tax exempt income includes:
-gain from sales of shares, received from an EU company or a company registered in a country with which Lithuania has a double tax treaty,
-received insurance payments,
-proceeds of a bankrupt company
-received penalties and fines

Allowable deductions include:
-depreciation and amortization of fixed assets
-maintenance, repair and construction of fixed assets
-business trips, advertizing and entertaining
-bad debts.
Other Corporate Taxes
Real property tax, land tax, land lease tax, environmental tax, tax on natural resources. Social security contributions.
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.
 

Country Comparison For Corporate Taxation

  Lithuania Eastern Europe & Central Asia United States Germany
Number of Payments of Taxes per Year 11.0 28.0 11.0 9.0
Time Taken For Administrative Formalities (Hours) 175.0 260.0 175.0 207.0
Total Share of Taxes (% of Profit) 43.7 40.5 46.7 46.8

Source: Doing Business - Last Available Data.

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Individual Taxes

Tax Rate

Income tax 15%
Income tax for dividends and other profit distributions 20%
Allowable Deductions and Tax Credits
The following items among others are allowed for income tax deductions: life insurance premiums; pension contributions paid to the pension funds registered in Lithuania or other EU member states; interest paid for the loan financing of acquiring dwellings; amounts paid by Lithuanian residents for higher education studies; amounts paid for the purchase of a computer during the period from 2004 to 2009.
Special Expatriate Tax Regime
No, there is no special tax regime for expats. A difference is made between residents and non-residents.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of the tax conventions signed by Lithuania.
Withholding Taxes
Dividends: 0/15%, Interest: 0/10%, Royalties: 10%

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Sources of Fiscal Information

Tax Authorities
State Tax Inspectorate under the Ministry of Finance
Other Domestic Resources
Lithuanian Development Agency
Business and Taxation information
Consult Taxation trends in the European Union.

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Learn more about Taxes and Accounting in Lithuania on Globaltrade.net, the Directory for International Trade Service Providers.

Intellectual Property

National Organizations
The State Patent Bureau is in charge of regulations around intellectual property in Lithuania.
Regional Organizations
Lithuania is party to a number of major international treaties and agreements on intellectual property protection.
 

National Regulation and International Agreements

 
Type of property and law Validity International Agreements Signed
Patent
 
Patent Law, 1994, last amended in 2001
20 years
Trademark
 
Law on Trademark, 2000, last amended in 2004
10 years from the date of application, renewable. Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks
Design
 
Industrial Designs Law, 2002, last amended in 2004
5 years, renewable four times, for 5-year periods up to 25 years  
Copyright
 
Law on Copyright and Related Rights, 1999, last amended in 2003
Recognition of a copyright and its legal protection in Lithuania is not subject to any local registration requirement. WIPO Copyright Treaty
Industrial Models
 
Industrial Designs Law, 2002, last amended in 2004
5 years, renewable four times, for 5-year periods up to 25 years  

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Legal Framework

Independence of Justice
The judiciary in Lithuania is largely independent, though lack of qualified judges and lawyers often undermines the right to a fair trial.
Equal Treatment of Nationals and Foreigners
Foreign nationals can expect an impartial trial from the country's judicial system.
The Language of Justice
Lithuanian is the judicial language used in the country.
Recourse to an Interpreter
Having an interpreter is possible.
Sources of the Law and Legal Similarities
The main source of the law in the country is the Constitution of 1992; with its legal system based on civil law system. Lithuania being a member of the European Union, the national law in the country needs to comply with the conditions of the Community legislature.

 

Checking National Laws Online
Main Lithuanian laws online

Learn more about Lawyers and Legal in Lithuania on Globaltrade.net, the Directory for International Trade Service Providers.

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Standards

National Standards Organizations
Lithuanian Standards Board
Integration in the International Standards Network
LST as a national standards body follows international and European standardization principles in its activities and represents the Republic of Lithuania within International Organization for Standardization (ISO), International Electrotechnical Commission (IEC), European Committee for Standardization (CEN), European Committee for Electrotechnical Standardization (CENELEC) and European Telecommunications Standards Institute (ETSI). Additional national requirements can be added to EU standards.
Classification of Standards
Information about standardization in Lithuania can be obtained at theLithuanian Standards Board website. Lithuanian standards are those which exist in all European Union member countries, one of the most known being the "CE" marking.
Online Consultation of Standards
More information about national standards can be obtained at: Lsd.
Certification Organizations
Lithuanian Standards Board

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Business Practices

General Information
In Your pocket guide, (choose Lithuania)
Opening Hours and Days
Stores open from 10 AM to 9 PM during the week and from 10 AM to 5 PM on Saturday; some grocery stores open earlier and close later (8am-10pm or 12pm), they open on Sunday and on days-off but close earlier (5 or 6 PM).
 

Public Holidays

New Year's Day January 1
Independence Day (1918) February 16
Restoration of Independence (1990) March 11
Easter Sunday and the following Monday
Labor Day May 1
Mother's Day First Sunday in May
Midsummer Festival June 24
Coronation of Mindaugas, King of Lithuania July 6
Assumption Day August 15
All Saints' Day November 1
Christmas December 25 and 26
 
 

Periods When Companies Usually Close

Christmas break 1 week between Christmas and New Year (not compulsory)
Midsummer break 3 days to 1 week around Midsummer (in June)
 

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Last Updates: January 2015