The 2012 worldwide VAT, GST and sales tax guide

K OREA – LATVIA 385
A trader also must submit an aggregate summary of the tax
invoices for both sales and purchases and any supporting documents
for zero-rated supplies at the time the preliminary returns
and final returns are submitted.
Record retention. A trader must keep the books in which the
transactions are recorded for a period of five years after the date
of the final return for the tax period in which the transactions
occurred. The books must also contain details of tax invoices or
receipts issued or received. Records may be kept in hard copy or
in electronic format.
Payments. A taxable person must pay the VAT due at each business
place at the time of filing the return. However, if a trader
has more than two business places, it may pay the entire VAT
due at its principal place of business with the prior approval
from the tax office that has jurisdiction over the principal business
place.
Penalties. Penalties apply to the following VAT errors or offenses:
• Failure to register within 20 days from the set up of a business:
1% of the value of supply
• Failure to issue a correct tax invoice (including ETI) or to submit
a correct list of tax invoices issued: 0.5% to 2% of the value
of supply
• Failure to transmit a list of ETIs issued: 0.1% to 0.3% of the
value of supply
• Failure to report a zero-rated VAT transaction in a VAT return: 1%
of the tax base
• Failure to file a tax return: 10% to 40% of the underpaid tax
amount (overpaid tax refund)
• Underpayment and nonpayment of taxes or overestimated
refund: underpaid tax amount (or overpaid tax refund) at a rate
of 10.95% annually
• Failure to comply with the requirement to make a proxy payment
(reverse charge): 10% of the amount not paid
The first three penalties listed above are capped at W 100 million
(W 50 million for SMEs). The cap covers every six-month period.
Latvia
(Country code 371 )
Riga GMT +2
Ernst & Young
Muitas iela 1
LV 1010
Riga
Latvia
Indirect tax contacts
Irena Lejina +371 6704-3901
Email: irena.lejina@lv.ey.com
Ilona Butane +371 6704-3836
Email: ilona.butane@lv.ey.com