Month: April 2025

Eco Baltia reminds of the procedure for the application of the reduced rate of income tax on coupon payment on bond issue 

---

The largest environmental resource management and recycling group in the Baltics, Eco Baltia AS, informs bondholders who are non-residents of Latvia about the procedure for applying reduced personal income tax (PIT) or exemption from PIT for coupon payments on bonds issued by the company. 

Pursuant to the Law on Personal Income Tax (“PIT”), income related to interest income received by a non-resident of Latvia is taxed in Latvia. From 2025, the rate is 25.5%. This means that a Latvian company paying interest to a non-resident individual is obliged to withhold PIT. 

Latvian non-resident taxpayers may be subject to a reduced rate of personal income tax or even tax exemption based on the double tax treaty in force between Latvia and the signatory’s tax domicile. 

If a non-resident of Latvia wishes to have the interest income paid on the Securities subject to the lowest possible rate of personal income tax at the time of coupon payment, the holder of the Securities must submit the original of the Resident Certificate for Tax Relief to Eco Baltia AS. It must be submitted for each calendar year separately. 

If the standard rate of withholding tax has already been deducted at the place of income, it is possible to apply for a tax refund by submitting the original of the Resident’s Tax Refund Certificate to the Latvian Tax Administration. The PIT refund may be claimed starting from 1 March of the year following the calendar year of interest income receipt. 

Full information on the possibility of obtaining a reduced rate or exemption from income tax can be found HERE>>