What is the profit tax rate in Lithuania?

Profit tax rates in Lithuania can be as follows:

• 0% rate for the first tax period (first 12 months of activity) if the company meets the following requirements: 1) income for the tax period does not exceed 300,000 euros; 2) the number of employees does not exceed 10; 3) the shareholder and members of their family do not own more than 50% of shares in other companies.
• 5% rate for companies of any age that meet the following requirements: 1) income for the tax period does not exceed 300,000 euros; 2) the number of employees does not exceed 10; 3) the shareholder and members of their family do not own more than 50% of shares in other companies.
• 15% rate for companies of any age that do not meet the requirements mentioned above.

The tax base for profit tax includes all income from sources within the Republic of Lithuania and outside the Republic of Lithuania. The taxable base is determined as the difference between the company’s income and expenses. In general, the company‘s income includes all operating income, dividends, interest and capital gains. The expenses include operating expenses, depreciation, loan interest and other allowable expenses.

The tax period is usually equal to one calendar year. At the taxpayer’s request, taking into account the specifics of the company‘s activity, a different tax period may be established, with a condition that a tax period is equal to 12 months.

The income tax reporting must be submitted to the Lithuanian Tax Inspectorate within 5 months after the end of the tax period.

It should be noted that the tax system may be a subject to changes, and it is important to get consultings from the tax specialists or lawyers specializing in Lithuanian tax legislation for specific information and advice.