Factsheet for measure
LT-2020-12/329
–
Updated
– measures in Lithuania
Tax deferral for companies and self-employed
Mokesčių atidėjimas įmonėms ir savarankiškai dirbantiems asmenims
Background information
After the Government of the Republic of Lithuania declared an emergency situation and quarantine, many companies and self-employed persons had to discontinue or partially restrict their activities. In such a situation, a number of businesses do not have the opportunity not only to pay salaries to employees, but are also unable to pay social insurance contributions and other taxes. On 17 March 2020, the Law No. XIII-2812 amending Article 88 of Law No. IX-2112 on Tax Administration of the Republic of Lithuania was adopted to increase the ability of taxpayers with temporary financial difficulties to stabilize their financial situation through deferral or arrangement of tax payment arrears.
Content of measure
Taking into account the restrictions/prohibitions on activities set up during quarantine, the State Tax Inspectorate has announced economic activities in which taxpayers may have suffered a direct negative impact as a result of the reason above and has published a list of specific taxpayers to whom the following assistance measures will automatically apply: non-recovery of declared taxes (other than customs duties), exemption from the payment of default interest and no interest accruing on concluded tax loan agreements. These taxpayers are subject to analogous measures to facilitate the payment of state social insurance contributions. This principle shall apply to taxes that are due after 16 March 2020 (i.e. after the declaration of quarantine) until the state of emergency is lifted.
Updates
The following updates to this measure have been made after it came into effect.
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27 April 2021
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On 27 April 2021, Order No VA-30 of the Head of the State Tax Inspectorate (STI) under the Ministry of Finance of the Republic of Lithuania was adopted, extending tax relief measures to COVID-19 affected companies and the self-employed until 31 August 2021. The tax relief measures apply to the companies falling into the list of businesses affected by the pandemic, as compiled by the STI. Taxpayers appearing in the list drawn up by the STI, whose tax arrears arise during the period from 1 January 2021 to 31 August 2021, shall be automatically, without a separate application, applied the following support measures until 31 October 2021:
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non-initiation of tax recovery;
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exemption from interest on arrears.
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26 March 2020
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On 26 March 2020, Order No VA-27 of the Head of the State Tax Inspectorate (STI) under the Ministry of Finance of the Republic of Lithuania was adopted, providing that new recovery actions for tax arrears shall not be initiated in respect of taxpayers affected by the spread of the COVID-19 coronavirus and included in the STI list until the state of emergency is lifted in the country and two months after the end of the emergency. Likewise, on separate request of taxpayers, new recovery actions shall not be initiated against taxpayers who are not on the list but who have also been adversely affected by COVID-19. These provisions also apply to self-employed residents.
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Use of measure
According to the data provided by the STI, as of 12 June 2020, tax aids have been used by some 21,000 entrepreneurs adversely affected by COVID-19; tax deferrals amount to approx. €392 million (with €245 million VAT predominating).
According to STI’s data for April 2021, a total of 73,000 companies were included in the STI’s list of companies affected by the pandemic; as of 23 April, legal entities and individuals together had €673.9 million in arrears due to COVID-19.
Target groups
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Workers
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Businesses
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Citizens
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Self-employed
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Applies to all businesses
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Does not apply to citizens
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Actors and funding
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Actors
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Funding
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Social partners jointly
Company / Companies
Social insurance
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No special funding required
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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Consulted
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Consulted
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Form
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Direct consultation outside a formal body
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Direct consultation outside a formal body
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Social partners' role in the
implementation, monitoring and assessment phase:
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Unknown
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Main level of involvement: Unknown
Involvement
No information available.
Views and reactions
Social partners consulted only ad hoc, the tripartite meeting was not held.
Sources
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17 March 2020: Lietuvos Respublikos mokesčių administravimo įstatymo Nr. IX-2112 88 straipsnio pakeitimo įstatymas (2020-03-17)
(e-seimas.lrs.lt)
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26 March 2020: Order No VA-27 of the Head of the State Tax Inspectorate (Valstybinės mokesčių inspekcijos (VMI) prie LR finansų ministerijos viršininko įsakymas Nr. VA-27
(e-seimas.lrs.lt)
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19 June 2020: The end of quarantine signals the end of tax holiday: What taxes are back? (Pasibaigus karantinui, baigėsi ir mokesčių atostogos: kokie mokesčiai sugrįžta
(www.delfi.lt)
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26 April 2021: STI: tax relief measures to businesses and individuals extended until 31 August + 2 months
(www.vmi.lt)
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27 April 2021: Order No VA-30 of the Head of the State Tax Inspectorate (STI) under the Ministry of Finance of the Republic of Lithuania
(www.e-tar.lt)
