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Tax Law in Lithuania

The Lithuanian Tax Law has gone through many changes in the past few years. At the end of year 2001 the Legal Entity Income Tax was revised and in the middle of 2002 a new Legal Entity Income Tax came into effect which went through a significant amending at the beginning of 2004 on the ground of Lithuania´s accession to the EU. At the beginning of 2003 a new Legal Entity Income Tax came into the operation as well as with the entrance into the EU on 1 May 2004 a new Consumption Tax and Tax Administration Law.

Nowadays we recognize following taxes in Lithuanian Tax Law:

  • Legal Entity Income Tax
  • Individual Income Tax
  • Value Added Tax
  • Basic Rate Tax
  • Estate Tax on the Immovable Property of Enterprises and Organizations
  • Consumption Tax (for example on mineral oils, gas, alcohol, tobacco)
  • Natural Resources Tax (on wrappers)
  • Lottery and Gambling Tax
  • Compulsory state and social insurance
  • Inheritance Tax
  • Customs Tax

The national taxes are levied by the State Tax Inspection (the Lithuanian Earned Income Tax Bureau). The VAT and the Consumption Taxes are collected by customs officers. The earned income tax bureaus, tax collection, tax administration and rights and duties of tax payers are specified in the Law on Tax Administration.

Tax Law in Lithuania

Further information

Legal Entity Income Tax in Lithuania
The Legal Entity Income Tax Law has come into effect on 1 January 2002. According to this law the Lithuanian companies are liable to the Legal Entity Income Tax with its total revenue as well as foreign companies with the part of income achieved by permanent business activities in Lithuania and income earned through the sources in Lithuania.
Individual Income Tax in Lithuania
Of his day the rate of the Individual Income tax was regulated to 33%. From 1 July 2006 this tax rate was reduced to 27% and to the final 24% from 1 January 2008.

VAT in Lithuania
The VAT Law came into operation on 1 July 2002 and on 1 May 2004 it has been adjusted to the norms of the EU including the 6th VAT Directive. Since then all amendments of the VAT on internal supplies have been used.
VAT Refund in Lithuania
In the 13th Directive of the Lithuanian VAT Law from 2002 (amended on 15 January 2004, clause IX-1960), the possibility of the VAT return for foreign companies has been created.
Convention for the Avoidance of Double Taxation Austria - Lithuania
The Convention for the Avoidance of Double Taxation between Austria and Lithuania (Federal Law Gazette III 209/2005) was under consideration from 2002; 6 April 2005 was signed and since 17 November 2005 it has came into effect.
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