Personal income tax

Lithuania has a 10 % flat-rate tax system. Pensions and other social security payments are exempt from taxation. The net income of sole proprietors is taxed separately by way of a 15 % final flat tax. Family members are taxed separately.

Corporate taxation

Corporate tax in Lithuania in 2014 is fixed at 10 %

VAT

The standard rate of VAT is 20 % and the reduced rate (ie. hotel accomodation) is 9 %.

Taxation of Employee
An employer is obligated to deduct tax at source from an employee and to make additional contributions to social security. 

Lithuania Social Security
As regards to salaried employees, the social security rates are:
        Employer 17.8%-18.5%.
        Employee 12.9%.  

Other deductions
Tax must be deducted at source from the following payments to non-residents on the basis of the following:

• - Dividend - The standard deduction is 5% (0% from dividend paid to EU/EEA companies).
• - Interest - the standard rate of tax deducted at source - 10%.
• - Royalties - the standard rate of tax deducted at source - 10%
  

Social contributions

Contributions are due for the public social insurance funds, covering pension rights (17.8 %), general sickness and maternity (3.5 %), health (8 %), and unemployment (1 %). The share paid by the employer and employee is 60:40.
The base is the gross employee's income subject to a monthly minimum and a ceiling set in the legislation.

Corporate and personal income tax rates, VAT in Lithuania

Country	Corporate Income tax	Personal income tax	VAT
Lithuania	10%	10%	20%

 

To go further

pwc.com/bg/en - PricewaterhouseCoopers Lithuania

 

Other useful sections of the website

Business and trade in Lithuania

Law and justice in Lithuania

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