Latvia is a small country that’s part of the Baltic states, making it a great location for companies that want to form relationships with other businesses in Europe. Although it’s exciting to form a new company location, you must first figure out how to set up a Latvia payroll and set up an entity to stay compliant.
Instead of worrying about the different Latvia payroll options, G-P offers a better alternative. As a global Employer of Record (EOR), companies can leverage our existing subsidiary to hire employees and streamline payroll. Instead of navigating the complexities of global expansion alone, you can rest assured that with G-P, your teams will be paid on time and compliantly, regardless of geography.
Taxation rules in Latvia
De belastingregels van Letland zijn van toepassing op zowel werkgevers als werknemers. The country uses a pay-as-you-earn (PAYE) system. Employers have to contribute 23.59% of wages to social security, and employees contribute 10.5%. Since employers need to deduct income taxes at the source, it’s important for you to understand all of the country’s tax rules and regulations or work with an expert.
Latvia payroll options for companies
You have 3 different Latvia payroll options to choose from, including:
- Internal: You can set up your own Latvia payroll if you have a subsidiary, but you’ll need a large HR team to support it. Usually, this option only works for larger subsidiaries that also have a big budget and a long-term commitment to Latvia.
- Latvia payroll processing company: A local Latvia payroll processing company is an outsourcing option for your company, but with this solution, you’ll still be responsible for all of the company’s actions and compliance matters.
- G-P: The easiest way to run payroll in Latvia and stay compliant is partnering with an Employer of Record (EOR) like G-P. With us, you can rest assured that all employees will be paid on time and compliantly, freeing you to focus on other important aspects of your business.
How to set up a payroll in Latvia
Voordat u begint met het opzetten van uw salarisadministratie in Letland, hebt u een geregistreerde dochteronderneming nodig. Zonder rechtspersoonlijkheid kunt u geen werknemers inhuren, ze toevoegen aan een salarisadministratie, ze betalen of beginnen met werken in het land.
Working with G-P doesn’t equal the same requirement — you can use our EOR instead of establishing your own subsidiary. Instead of waiting months, you can start hiring and paying your teams in minutes with G-P.
Voorwaarden voor recht/beëindiging
Hiring and terminating employees is often difficult in another country, which is why adding entitlement and termination terms to employment contracts before choosing a Latvia payroll option will help you stay compliant.
The country allows fixed-term contracts for up to 2 years, and you can also hire employees under a probationary period of up to 3 months. Notice periods for dismissal range from 10 days to 1 month, depending on how long the employee has worked for the company. Werknemers hebben ook recht op een ontslagvergoeding op basis van dienstjaren.
Stroomlijn het wereldwijde loonadministratiebeheer met G-P.
G-P stroomlijnt elke stap van het salarisadministratiebeheerproces met dit toonaangevende Global Employment Platform. Betaal je team met vertrouwen overal ter wereld in 150 valuta's met het 99% tijdige geautomatiseerde loonadministratiesysteem, allemaal met slechts een paar klikken. De producten kunnen ook worden geïntegreerd met toonaangevende HCM-oplossingen, waarbij de loonadministratiegegevens van werknemers automatisch tussen platforms worden gesynchroniseerd om één betrouwbare, handige bron van waarheid voor HR-teams te creëren.
Neem contact met ons op voor meer informatie over hoe wij u kunnen ondersteunen.