How to Establish A Limited Company

Setting Up A Limited Company in Latvia | Complete Guide

There are steps to be followed and important information to have for setting up a limited company in Latvia. Thanks to these, the process of setting up a company can be handled much more smoothly and in a shorter time. In the rest of our article, there is a detailed guide about the process of setting up a company in Latvia. Thanks to this guide, you can reach all the details you want about the company establishment process.

How to set up a limited company in Latvia in 6 simple steps? How does the process proceed? How long does it take? What documents are required? All the details are in our comprehensive guide.


1. Selecting the Limited Company Type

The most popular type of company in Latvia is limited companies (LLC). One of the most important reasons is that setting up a limited company is simple and fast. Limited companies also have different types and they have some unique features.

1.1: Standard Limited Company

It can be set up with a public notary power of attorney. It’s considered established upon entering the Trade Registry and acquires a legal entity status. It has all the responsibilities regarding the assets. The partners do not have the responsibility for their obligations.

1.2: Micro Enterprise Limited Company

They are companies whose founders are real persons and whose turnover is less than €100,000 per year. The number of employees is at most 5 and the amount paid to employees can be at most 720 €. The main purpose of this company type is to support small entrepreneurs. This support is made with tax calculations and different incentives.

1.3: Small Capital Limited Company

It can be expressed as a company with a legal personality set up by real persons and whose number of founders does not exceed 5. The board of directors may consist of one or more members. The company’s share capital can be less than € 2,800.

Limited Company Types

You May Also Like: Types of Corporate Commercial Enterprises in Latvia


2. Providing the Necessary Information

During the setting up a limited company in Latvia, certain information should be provided and given to the relevant institutions. Thus, the company will be set up under the relevant legal legislation.

2.1: Making the Business Selection

Business selection should be made according to the purpose of the company to be established. At this point, there are standard, micro-enterprise, and small capital options. By examining the details of these, you can choose the most suitable one for your purposes.

2.2: Company Name

The name of the company must be determined. The company name must contain only Latin and Latvian letters. Also, the selected name should not have been registered before. You can check whether the name you chose has been used before at

2.3: Registered Office Information of the Company (Legal Address)

The information as to where the company conducts its activities, that it has a legal address, should be provided. The address must be in Latvia. It should be the same as the address of the administration. Another important requirement is that this address is to be registered with the National Address Registry. Here, there is an important point to be aware of. Although the address of the company must be in Latvia, there is no requirement for founders to reside in Latvia.

2.4: Equity Information

LLC’s minimum capital must be € 2,800. The company shares cannot be sold on the stock exchange. At least half of the capital must be paid before registering with the Business Registry. The remaining amount must be paid within 1 year. Apart from this, the capital can be 1 € when Micro Capital Company or Reduced Capital Company is preferred.

2.5: Equity Payment Method

The equity of the company to be established can be in different amounts depending on the type of business. The minimum capital amount of the LLC is 2.800 € and this capital must be deposited in the bank in cash. Apart from this, property (in-kind) can also be shown as capital. After the value of the relevant property is determined, the amount of the capital will be clear.

2.6: Information of Company Shareholders

The founders of the company must be real persons and their number must be at most 5. The members of the board of directors must also be the founders of the company. Apart from these, one person can be a founder of only one small capital Company.

The shareholders of standard companies can be real persons or legal entities. The number of shareholders must be at least 1. In Latvia, there is no restriction imposed on foreign legal and real persons for being shareholders of standard companies.

2.7: Company’s Board of Directors Information

Managing bodies of the company established in Latvia are;

  • >>> Board of the Company,
  • >>> Company council,
  • >>> Shareholders’ meeting.

It is possible for the board of the company, that is, the board of directors, to consist of one or more real persons. Besides, the members of the board of directors can reside in Latvia or a different country.

Important Information for LLC

You May Also Like: New Companies Established in Latvia Are Among Fastest Growing


3. Documents Required for Limited Company Registration

Company registration is one of the first steps to be taken for setting up a limited company in Latvia. To do this some documents must be submitted. These documents are as follows:

  • >>> Application form for company registration
  • >>> Corporate charter or decision to set up a company as a sole shareholder
  • >>> Capital payment to the bank
  • >>> Founder registry schedule of company
  • >>> Articles of Association
  • >>> Approval to have a corporate council (if the council has been established)
  • >>> The decision signed by the board member regarding the legal address of the company
  • >>> Allowance decision of the property owner to register the company at the address
  • >>> Proof of payment/receipt of state taxes for company establishment
  • >>> Approval of being a member of the company’s board of directors
  • >>> Proof of payment/ receipt for publishing in the official gazette “Latvijas Vestnesis”


4. Opening a Temporary Bank Account

PNB Banka Latvia

A bank account should be opened for the payment of the capital at the stage of company establishment until the company is registered in the trade registry. This account is called a temporary bank account.

4.1: According to the Amount of Equity

4.1.1: If the Equity is Less Than 2800€ 

A company with a capital of less than € 2.800 is expressed as a small-scale limited company. SIA (LLC) which is a legal entity is non-public. Members of this company are responsible for outstanding amounts not exceeding the company’s capital. Documents required when establishing a company with equity of less than € 2.800 are generally as follows:

  • >>> Application form (The application form (Form 4) should be signed or approved by the official of the trade registry institution or by a notary through e-signature.)
  • >>> Resolution of Establishment (or association memorandum)
  • >>> Regulations
  • >>> Document showing that the capital has been paid (Bank receipt or founders’ certificate)
  • >>> Registration of participants (Approved by the Business Registry official or notary through E-signature or signature.)
  • >>> Approval of the Council members (if there is a Council)
  • >>> Letter of consent (The consent safely signed by the members of the Board is approved by the trade registrar or notary.)
  • >>> Board of directors statement regarding the registered office
  • >>> If the real estate where the company resides is a rental, the document showing the approval of the property owner.
  • >>> Receipts of Government and other payments
  • >>> Information on Latvijas Vēstnesis publications

An application can be made to set up a limited company in Latvia with these documents. In addition to these, there are some features that a limited company with a capital of less than € 2.800 should have. These can be listed as follows:

  • >>> The company must be established by a real person or persons.
  • >>> Number of founders should be at most 5.
  • >>> The board of directors should consist of 1 or more members. All members of the board of directors are also members of the company.


Minimum Capital?

The capital of the company that has these features must be at least €1. This capital must be pledged and paid in full in cash until the registration application is made.

Minimum Capital for LLC

The company can’t have a micro-enterprise taxpayer status after the limited company is registered by the trade registry; the company can’t become a micro-enterprise taxpayer. This is because a company with a capital of less than € 2,800 and a micro-enterprise are not the same. If the company has a goal of gaining micro-enterprise taxpayer status, while they are applying for company registration, they can also apply for micro-enterprise taxpayer status.

  • >>> The number of employees of the micro-enterprise is at least 5. Employees must be informed following the requirements of chapter 3 of the applicable law.
  • >>> Expected turnover can be up to 100.000€.
  • >>> Microenterprise is obliged to pay micro business tax.


4.1.2: If the Equity is More Than 2800€

The capital of the limited company must be a minimum of €2,800. However, if the company complies with certain conditions in the Commercial Code, there may be less capital. The limited company is non-public. It is a legal entity. Members of the company do not bear any responsibility.

At least half of the company’s capital must be paid until the registration application is made. The other part has to be paid in 1 year from the date the company is registered in the trade registry. The rest of the capital must be paid in this period. This payment can be made in cash or in-kind. In the case of in-kind contribution, an opinion should be prepared and presented including the following:

  • >>> Disclosure of investment instruments one by one
  • >>> Valuation method of investments
  • >>> Opinion on whether the real estate investment is suitable for the company’s commercial activity type.

The opinion covering the above issues must be prepared and approved by the following persons:

  • >>> An expert on the list approved by UR
  • >>> Founders if the value of the real estate is less than € 5.700 and the real estate investment is less than half of the company’s capital.
  • >>> Founders; if the share capital is paid using transferable securities and money market instruments in a licensed market in one of the EU member states or one of the countries of the European Economic Area, at least 2 years before signing the partnership agreement or making a capital increase decision.

Bank Account for LLC


4.2: Documents Required to Open a Temporary Account

The documents required to open a temporary bank account are as follows:

  • >>> Temporary bank account opening application form of company founders
  • >>> Articles of Association in which the authorized person is specified (If all founders come to the bank to open the account, this document showing the authorized person is not required.)
  • >>> Identity cards of all founders who come to the bank to open the account or identity card of the authorized person for doing so.

Apart from these, some banks may request extra documents. SEB bank requests the company’s articles of association. Swedbank, on the other hand, asks for company type, full company name, abbreviated company name, international name, and field of activity, legal address, and registration form, and contact information.


4.3: Account Opening Methods for Limited Company

There are 2 different methods for opening a temporary bank account in the process of setting up a limited company in Latvia.

4.3.1: Branch

An account can be opened by going to a bank branch. Although internet banking is frequently preferred, the number of people who open an account in the traditional way that is by going to the bank branch is not few.

4.3.2: Internet Branch

It is also possible to open an account by making an application from the bank’s internet branch. However, the applicants must have their e-signature. A temporary bank account can be opened by signing a contract with an e-signature.


5. Conversion of Temporary Bank Account to Permanent Account

The temporary account can be used until the company is registered in the trade register. After entering the trade registry, it is possible to make an agreement with the bank and convert the temporary bank account into a permanent account.

When an agreement is presented, the temporary account is converted into a permanent account by the bank. If the client wants to close the temporary account after the company has entered the trade registry, founder contributions are paid by the bank based on the customer’s written application. If the company terminates its establishment before entering the trade registry, the capital deposited by the bank in the temporary account will be paid as per the instructions of the founders.

After the temporary account is converted to a permanent account, the company will have the freedom to dispose of funds and to open additional accounts when necessary.


6. Taxpayer Registration for Limited Company

Setting up a limited company in Latvia and registering with the trade registry does not directly grant micro-enterprise taxpayer status. Because a limited company with a capital of less than € 2,800 and a micro-enterprise are not the same!

Taxes for a Limited Company in Latvia

If a company wishes to have taxpayer status simultaneously with the registration at the trade registry, the founders must make an application. Founders can apply for a micro-enterprise taxpayer status in UR concurrently with their application for registration in the trade registry.

  • >>> The number of employees in the micro-enterprise should be at most 5. Besides, employees must be informed following the requirements in section 3 of the law.
  • >>> Expected turnover will be up to 100,000€.
  • >>> The micro-enterprise pays micro-enterprise tax.

You May Also Like:Tax Incentives for Investment in Latvia


6.1: Differences Between Micro and Small Capital Limited Companies

A micro-enterprise with a capital of less than €2.800 and a limited company (small scale company) cannot be considered as two different types of traders. Microenterprise can be expressed as a taxpayer paying a special tax. Therefore, a small capital limited company (SIA) can become a micro-enterprise taxpayer if it wishes.

6.2: Registration Fees

During this process, companies will have to pay different fees for registration. Registration fees are generally as follows:

  • >>> Government fee: 150€
  • >>> “Latvijas Vēstnesis” i.e. publication in the Latvian official gazette: 30€ (Free as of 2021)
  • >>> Opening a bank account: 10-30 €
  • >>> The signing of Company Ledger and related documents at the notary: Transactions starting from 20€



These are the details about setting up a limited company in Latvia. Although we try to cover every detail to the finest point, there may be articles updated with new laws. At this point, getting expert support will make your transactions easier. Although the company registration process seems long, it takes only 1 day to set up a limited company after getting the documents ready.

If you have limited time for all these documents and application procedures, you can contact us and make things quicker. You can set up your limited company in Latvia in a very short time with the least cost with our commercial law lawyers and expert consultants.

>>> For Details Contact Us.