Business Guide Lithuania 2017

General, tax and legal information for foreign investors Table of Contents

General information 2 Facts and figures. Politics.

Economic environment 6 Key economic indicators. Attractive sectors. Regional and urban economic overview and trends.

Setting up a business 10 Ease of doing business. Types of entities. Accounting and audit requirements.

Investment incentives 12 Investment financing. Legal framework.Double taxation treaties. Investment in real estate and land. Investment protection and guarantees.

Labour 16 Conclusion of employment agreement. Working conditions. State social security issues.

Immigration & permits 18 EU citizens. Non-EU citizens.

The tax system 20 Corporate income tax. Withholding tax. Value added tax. Personal income tax. Social security. Other taxes.

Useful links 31 Exhibition and Conference Management. Transport and Communications. State Institutions. Largest Cities.

PwC 32 Tax services. Legal services. Accounting services. Advisory services. Assurance services. PwC’s Academy. Contacts.

© 2017 PricewaterhouseCoopers UAB. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details. Country Managing Partner’s Foreword

It’s a great pleasure for me to present the capital of Lithuania – was elected the Business Guide of Lithuania 2017. as the best destination for establish- The Guide offers a useful insight into ing the shared service centres and the Lithuanian business environment outsourcing across the CEE region for the potential individual or corpo- for the second year in a row. In addi- rate investors. It provides answers to tion, Kaunas – the second largest city the most common questions that the in Lithuania – was also repeatedly investors may have: from business awarded as an emerging city of the set-up to the most relevant upcoming year among all the CEE countries. changes in the regulatory system of Here, at PwC Lithuania, we’re proud the country. Our team at PwC Lithua- to share our insights to make your nia has also prepared an overview of first steps in the Lithuanian market the local economic environment, legal as easy as possible. We’re ready to requirements, educational advantages help you with a full range of busi- Rimvydas Jogėla and governmental incentives for in- ness, tax and legal issues. Our people Managing Partner vesting in Lithuania. have extensive expert knowledge and for PwC Lithuania I’m glad that despite the recent professional experience, and they are geopolitical events, Lithuania has willing to offer professional services managed to maintain a stable eco- tailored to the needs of your business. nomic growth. Lithuania’s economy is expected to perform even better in 2017 due to recovering exports, growing investments and increasing domestic consumption. As a result, it is not surprising that in 2016 Vilnius –

Business Guide Lithuania 2017 1 General information

Facts and figures Extending to 65,300 sq. km, Lithua nia is a country larger than Belgium, Geography Denmark, the Netherlands or Swit- The Republic of Lithuania is situated in zerland. Lithuania has around 99 km Northern Europe on the south-eastern of sandy coastline devoted to a com- shore of the Baltic Sea. It is the largest bination of leisure and conservation. of the three Baltic States, the other two Lithuania has an ice-free port in being Latvia and Estonia. Lithuania Klaipėda, which is the most important shares its borders with Latvia in the and the biggest Lithuanian transport north (558 km), Belarus in the south- hub, connecting sea, land and railway east (653 km), Poland and the Kalinin- routes from East to West. grad Region of the Russian Federation The climate is midway between mari- in the south-west (104 km and 249 km, time and continental. In January the respectively). To the west of the Baltic average daytime temperature is -3°C Sea, Sweden and Denmark lie. (27°F), rising in July to +20°C (68°F).

Country facts Estonia

Capital Vilnius Latvia Area 65,300 km² Lithuania Population 2.9 million Language Lithuanian Dominant languages English, Russian, German, Polish Currency Euro (EUR)

Source: Statistics Lithuania

2 Business Guide Lithuania 2017 Vilnius Old Town is a UNESCO World Heritage Site.

Population and language The population of Lithuania is 2.9 million. Some 86.7% of the population are ethnic Lithuanians, 5.6% are Poles, 4.8% are Russians, and 2.9% – others. Lithuania is the largest of the three Baltic States, but globally it is a small country. Its capital and the largest city is Vilnius with a population of 543 Lithuania is among Top 10 thousand. The second and the third largest cities are Kaunas and Klaipėda countries in the world by with a population of 295 thousand business start-up possibilities. and 153 thousand, respectively. The official and most commonly Vilnius is among 5 most spoken language is Lithuanian. It is one of only two living languages affordable EU cities to live in. (the other one being Latvian) of the Baltic branch of the Indo-European language family. About 92% of the population speak one foreign language (English, Russian, German or Polish) and more than 50% speak two foreign languages.

Time, weights and measures 97% Lithuania uses Eastern European Time, of working-age which is two hours ahead of Green- Lithuanians wich Mean Time (GMT+2 hours). Every year, between March and know at least September, Lithuania introduces Day- one foreign light Saving Time (GMT+3 hours). language Lithuania has Lithuania uses the metric system of weights and measures and the Celsius the highest temperature scale. tertiary educational Codes The international extension code for attainment Lithuania is 00 370. rate in the EU The country code used in the Internet domain names is .lt.

Business Guide Lithuania 2017 3 Politics • According to the Constitution of the Republic of Lithuania (adopted in 1992), Lithuania is an independent democratic parliamentary republic. • The supreme legislative power is held by the Seimas (Parliament), • The supreme executive power rests consisting of 141 members elected with the Prime Minister who is for a term of four years on the basis appointed by the President and the of universal, equal and direct suf- Parliament. Currently, the position frage and by secret ballot. of the Prime Minister is held by • In October 2016, the parliamentary Mr Saulius Skvernelis, one of the elections were held in Lithuania leaders of the Lithuanian Peasant and the Lithuanian Peasant and and Green Union party. Green Union party was the most • Lithuania has 60 municipalities voted for. The party focuses on re- governed by mayors elected di- ducing costs and enhancing produc- rectly for a four-year term starting tivity in the public sector, intensify- from 2015. ing regional development, creating • Lithuania joined NATO on 29 March a favourable investment climate 2004. On 1 May 2004, Lithuania in the country, and strengthening became a full member of the Euro- defence of the country. pean Union, and joined the Schen- • The President of Lithuania is gen Area on 21 December 2007. elected for a five-year term on • Lithuania was the first of the three the basis of universal, equal and Baltic States to hold the Presidency direct suffrage and by secret ballot. of the Council of the European The President represents the state Union (1 July 2013 – 31 December of Lithuania and performs the func- 2013) since joining the European tions prescribed to him/her by the Union. Constitution and other laws. Cur- • In 2013, Lithuania was elected to rently, the President of Lithuania is the United Nations Security Coun- Ms Dalia Grybauskaitė, who is the cil. Lithuania was the first country first female president in the Lithua from the Baltic States to be elected nian history. She was re-elected for to such post. the second term in 2014. • In June 2015, the Lithuanian del- egation received an official invita- tion to start accession process to the Organisation for Economic Coop- eration and Development (OECD). The party which won the parliamentary The Lithuanian authorities are elections in October 2016 focuses on in process of an intense technical maintaining a stable tax and legal accession, which is expected to be completed by 2018. environment in the country.

Lithuania’s court system

Supreme Supreme Administrative Constitutional Court Court Court

Court of appeals 5 regional administrative courts

5 regional courts

49 district courts

4 Business Guide Lithuania 2017 Business Guide Lithuania 2017 5 Economic environment Key economic indicators Economic indicators show that Brexit scandals and USA presidential elections have scrambled many exchange markets. Yet, Lithuania has quite promising forecasts and the economists expect the country’s economic growth to be higher in 2017 compared to 2016. The economists also expect that decreasing unemploy- 2.5% ment, recovering exports, increasing GDP growth investments and growing customer 2.2% in 2017* consumption will have an immense GDP growth impact on Lithuania’s economic re- in 2016* covery and growth.

Booming shared service centres In 2016, Vilnius was elected as the best destination for establishing shared Lithuania’s economy is rapidly growing service centres and outsourcing across the CEE region for the second year in a row**. Vilnius is attracting higher added value jobs such as business The main macroeconomic indicators for 2012-2017 analytics, anti-money laundering, asset management support, and IT 2012 2013 2014 2015 2016* 2017* development. More and more shared Nominal GDP (EUR billion) 33.3 35.0 36.4 37.3 38.2 40.0 service centres choose Lithuania as GDP growth rate, % 3.8 3.3 3.0 1.7 2.2 2.5 their destination due to highly skilled Average annual inflation, % 3.2 1.2 0.2 -0.7 0.8 1.5 well-educated professionals that are Unemployment rate, % 13.4 11.8 10.7 9.1 8.0 7.7 able to speak several foreign languages, a world-class infrastructure, and * Forecast a good location. Currently, there are more than fifty shared service centres in Lithuania that provide worldwide Foreign direct investments high-quality services. (accumulated as at the end of 2015, EUR million) Infrastructure Lithuania is situated at the heart Sweden, 3,182 24.0% of Europe, thus making it easy and Netherlands, 1,671 12.6% convenient to access other European cities. There are four international Germany, 1,278 9.6% airports in Lithuania, which offer Norway, 860 6.5% direct flights of up to three hours to the main business destinations. Poland, 701 5.3% The road network of Lithuania is also Estonia, 588 4.4% well developed. Lithuania has more than 71 thousand kilometres of roads, Finland, 546 4.1% whereof 91% are paved roads. Switzerland, 514 3.9% Denmark, 511 3.9% Malta, 448 3.4% Other countries, 2,958 22.3%

** Source: www.ceeoutsourcingawards.com

6 Business Guide Lithuania 2017 Attractive sectors Information and communication technology sector is one of the highly prioritised and most promising sectors in Lithuania. Over 27,200 employees in Lithuania are working in this sector. Modern technologies Lithuania’s biotechnology sector has recognised by nearly 100 countries (such as EDGE technology, 4G mobile been recognised as one of the most importing over 80% of the Lithuanian communications infrastructure and developed in the Central and Eastern laser production. Such companies and mobile WiMAX 4G Internet), the Europe. Biotechnology research takes organisations as NATO, Pentagon, fastest public Wi-Fi in Europe and the place in Lithuania, and the developed Nuclear Research Centre in Israel, greatest fibre-optic (FFTH) Internet techniques and products are applied Rezerford Laboratories in England, network penetration in Europe – in the fields of medicine, pharmacy, Berkley University, Livermore Na- all these factors make Lithuania espe- chemistry, agriculture, environ- tional Laboratory are the clients of cially attractive for offshore services. ment, etc. Lithuania’s biotechnology the Lithuanian companies producing Lithuania’s engineering industry products are recognised worldwide, lasers. The sector grows on average has been constantly growing and as 80% of them are exported to by 15% annually. expanding by approximately 15% over 70 countries. Different R&D Renewable energy development is every year since 2009. This industry incentives are offered to support the becoming increasingly important for is highly competitive in terms of cost development of biotechnology sector Lithuania’s export, too. Emerging and quality and it is well-integrated in Lithuania. The sector grows on potential of clean technology indus- into the global supply chains. Prod- average by 20% annually. try is supported by the pool of local ucts developed by the Lithuanian Another high-tech sector in Lithuania scientists and researchers, world- engineers are often adapted by such is laser technologies. Lithuania class achievements in electronics, international companies and organi- accounts for more than half of the and increasing interest of businesses sations as NASA, Boeing, U.S. Army, global market of picosecond laser with respect to the development of BMW, Volkswagen, Hitachi, Siemens speedometers. A world-class qual- this industry. and Mitsubishi*. ity of laser production has been

Local engineering industry works for NASA, Boeing, U.S. Army, BMW, Volkswagen, Hitachi, Siemens, Mitsubishi. Local biotechnology sector is among the mostly developed across the CEE region. Local laser producers have NATO Newcomers and Pentagon as their clients. in 2016 Turkish Airlines Mobile Angels Lithuania has the fastest Lidl public Wi-Fi in Europe Investments and the greatest fiber-optic expanded in 2016 (FFTH) Internet network CITCO penetration in Europe. Nasdaq CSD Ingenieure Peikko Group Adform

* Source: www.lietuva.lt

Business Guide Lithuania 2017 7 Regional and urban economic overview and

Latvia trends Vilnius Vilnius is the capital and the largest city in Lithuania and it has been

Šiauliai recognised as the economic, financial Klaipėda and commercial centre of Lithuania. Baltic Sea Panevėžys According to Statistics Lithuania, Vilnius County accounted for about Tauragė 40.4% of Lithuania’s GDP in 2015. Kaunas The GDP per capita in Vilnius County was calculated at EUR 18,700 in 2015. Vilnius Vilnius is ranked first in Lithuania in Marijampolė Russia terms of foreign direct investment. Alytus Overall 70.6% of foreign investment Poland Druskininkai in Lithuania was concentrated in Belarus Vilnius County at the end of 2015. Vilnius offers business-friendly environment, highly qualified human resources, perfect infrastructure and a convenient geographical location as it stands in the centre of Europe. Most of shared service centres established in Lithuania are operating in Vilnius. For the second year in a row, in 2016, the city was awarded as The Most Dynamically Developing City among CEE countries at the 4th annual CEE Shared Services and Outsourcing Awards. Vilnius also ranked 3rd among mid-sized European cities based on economic development, investment attraction strategy and attractiveness for foreign investment. Vilnius has recently initiated many investment projects focusing on improvement of road and bicycle infrastructure, development of a multifunctional centre and a new congress hall, etc. The business development agency GO Vilnius has recently renewed its operations to strengthen Vilnius’ appeal internationally to businesses and investors, and to support foreign of foreign investment investors, entrepreneurs, and compa- 70.6% nies that decide to make their move was concentrated in Vilnius County to Vilnius. at the end of 2015.

Danske Bank, Ahlstrom, CITCO, Western Union, Barclays, Swedbank, AIG, Nasdaq, Computer Science Corporation (CSC) have established their shared service centres in Vilnius.

8 Business Guide Lithuania 2017 Kaunas centres (valleys) in Kaunas – Santaka A favourable geographical location, and Nemunas. Santaka – the first convenient road, rail, water and air in- medical and pharmaceutical valley in frastructure, highly skilled labour force, the Baltic States – has been estab- flourishing knowledge-based business- lished for public and private research es and modern industry make Kaunas to set up knowledge-intensive busi- region one of the most attractive places nesses and provide value-added, for investment in the Baltic States as a knowledge-intensive services, while whole. A number of public and private Nemunas promotes the development universities and colleges are estab- of Lithuanian agriculture, forestry lished in Kaunas, including Kaunas and food sectors. University of Technology, which is the Kaunas was awarded as an emerging largest provider of engineering special- city of the year among CEE countries ists in Lithuania. Close partnership with 200% growth in terms of num- with businesses builds a pool of highly ber of projects, and 450% growth in qualified multilingual specialists in IT, terms of number of new jobs. human resources and finance*. The city’s development agency Kaunas Kaunas County generates 19.8% of IN has been recently established to total GDP in Lithuania with about promote Kaunas internationally, and EUR 12,700 nominal GDP per capita. to support foreign investors that decide Kaunas is mainly focussing on the to set up their businesses in Kaunas. development of technologies and innovation. Science and technology park Technopolis provides infrastructure and innovation support services Kaunas has become an increasingly popular for small and medium enterprises. investment destination for the companies It also helps to attract the talented scientists to the business organisa- searching for IT solutions: Callcredit, tions in Kaunas and foster entrepre- Intermedix and Virtustream have chosen neurship in general. There are two Kaunas for their business expansion. integrated science, study and business

Klaipėda for investors make Klaipėda espe- transport. Palanga International The port of Klaipėda is the northern- cially attractive for foreign investors. Airport is located only 35 km from most ice-free port on the east coast of The dominant sectors in Klaipėda are Klaipėda, it offers connecting flights the Baltic Sea. In 2013, the dredging shipbuilding and ship repairs as well to a variety of European cities. works were finished, which improved as transportation and logistics**. Klaipėda County itself accounted the safety of large ships in the port. Klaipėda offers cargo delivery possi- for around 12% of Lithuania’s total The reconstruction also improved bilities for business in a much shorter GDP in 2015. In 2015 the GDP per its competitiveness and increased its time and at a lower tariff by container capita in the County was calculated capacity compared to the neighbour- trains compared to other means of at EUR 13,200. ing ports. A convenient geographical location, sustainable economic growth, excellent infrastructure, highly skilled human resources, competitive business development costs and incentives

Convenient geographical location and business development incentives make Klaipėda especially attractive for foreign investors.

* Source: www.ceeoutsourcingawards.com ** Source: www.investinklaipeda.com

Business Guide Lithuania 2017 9 Setting up a business Ease of doing business A business can be set up electronically in just a few days if the entity’s establishment documents comply with the standard forms of documents. According to the World Bank’s Doing Business 2017 report, Lithuania ranks 21st in the world for ease of starting a business. Lithuania’s strengths are st also demonstrated in the fields of Lithuania ranks 21 in the world dealing with construction permits, for ease of starting a business. registering property and enforcing contracts.

Types of entities Private limited liability company (UAB) Public limited liability company (AB) - Separate legal entity (legal entity with lim- - Separate legal entity (legal entity with limited liability) ited liability) - A shareholder may be held liable for the ob- - A shareholder may be held liable for the obligations of a company only in the event of ligations of a company only in the event of failure to fulfil the obligations due to unfair failure to fulfil the obligations due to unfair actions of the shareholder actions of the shareholder - May engage in any legitimate activities - May engage in any legitimate activities - May engage in licensed activities upon - May engage in licensed activities upon obtaining the respective licence obtaining the respective licence Minimum amount of share capital is Minimum amount of share capital is EUR 2,500 EUR 40,000 Registration in 1-2 weeks Registration in 1-2 weeks General meeting of shareholders (sole share- General meeting of shareholders (sole shareholder) and general manager (single-member holder) and general manager (single-member management body) are mandatory bodies management body) are mandatory bodies Management board (min. 3 members) and Management board (min. 3 members) or (or) supervisory council (3-15 members) are supervisory council (3-15 members) is a optional bodies mandatory body No residence requirements to the general No residence requirements to the general manager, other members of other bodies manager, other members of other bodies Employment contract must be concluded be- Employment contract must be concluded between the general manager and the company tween the general manager and the company Audit required if certain criteria are met* Audit is required Comprehensive tax regulation Comprehensive tax regulation - Transfer pricing regulation is applicable - Transfer pricing regulation is applicable * Audit is required if at least two of the following criteria are met: - Transfer pricing documentation is manda- - Transfer pricing documentation is manda- - net revenue from sales exceeds EUR 3.5 million tory when turnover is over EUR 2.9 million tory when turnover is over EUR 2.9 million for the financial year; - value of assets in the balance sheet exceeds Thin capitalisation rules apply (4:1) Thin capitalisation rules apply (4:1) EUR 1.8 million; - average number of employees exceeds 50 for the financial year.

10 Business Guide Lithuania 2017 Accounting and If the financial year of a company coincides with a calendar year, audit requirements the financial statements must be Limited liability companies may approved by the general meeting choose at their own discretion of shareholders by 1 May of the to follow either the Lithuanian following calendar year. Business Accounting Standards or The financial statements together International Financial Reporting with an independent auditor’s report Standards (IFRS). (in case of statutory audit) must be The companies whose securities are submitted to the Register of Legal traded in the regulated markets must Entities, and they must be made keep their accounting records and publicly available in accordance prepare their financial statements in with the legal acts. accordance with IFRS.

Setting up a business is quick and easy

Open an accumulative Submit establish- Register a company Open a settlement bank account with ment documents with the Register bank account for minimum capital to a notary of Legal Entities ordinary transactions 2 days 1 day 3 days 1 day

Branch office Representative office Operating as a foreign company - Structural unit of a foreign company - Structural unit of a foreign company No registered presence (operations con- (not a separate legal entity) (not a separate legal entity) ducted through a foreign company, without - A founder is liable for the obligations - A founder is liable for the obligations any corporate registration in Lithuania) of a branch of a representative office - May engage in all or any part of the busi- - May engage in limited-scope operations: - May engage in any legitimate activities ness activities of a founder act on behalf of the founder, etc. - For licensed activities, registration of - May engage in licensed activities with a company or a branch may be necessary certain restrictions No share capital requirements No share capital requirements No share capital requirements Registration in 1-2 weeks Registration in 1-2 weeks No corporate registration required, however, registration for tax purposes may be necessary General manager is a mandatory manage- General manager is a mandatory manage- Bodies and their composition are regulated ment body ment body by the country of incorporation No additional corporate body may be formed No additional corporate body may be formed Bodies and their composition are regulated by the country of incorporation If the founder of a branch is a non-EEA com- If the founder of a representative office is No residence requirements apply pany, at least one person acting on behalf of a non-EEA company, at least one person the branch should reside in Lithuania acting on behalf of the representative office should reside in Lithuania Employment contract must be concluded Employment contract must be concluded No employment contracts are required between the general manager and the between the general manager and the repre- branch or the founder sentative office or the founder Audit may be performed as a part of the Audit may be performed as a part of the No audit is required founder’s audit founder’s audit Less comprehensive tax regulation Less comprehensive tax regulation Less comprehensive tax regulation - Transfer pricing regulation is applicable - Transfer pricing regulation is applicable - Transfer pricing regulation is applicable - Transfer pricing documentation is manda- - Transfer pricing documentation is manda- - Transfer pricing documentation is mandatory when turnover is over EUR 2.9 million tory when turnover is over EUR 2.9 million tory when turnover is over EUR 2.9 million No thin capitalisation rules apply No thin capitalisation rules apply No thin capitalisation rules apply

Business Guide Lithuania 2017 11 Investment incentives During 2014-2020, the level of funding obtained by Lithuania from the EU Structural Funds will Investment Legal framework exceed that of the other financing The legal system of Lithuania rec- Baltic States. ognises the generally accepted Lithuania enjoys the benefits of being principles of the legal regulation of a member of the European Union. investments. The principle of equal Both local and foreign businesses, treatment means that both Lithua having decided to expand their activ- nian and foreign investors have equal ity into the Lithuanian market, can business conditions defined in the apply for the support from the EU Lithuanian Law on Investment and Double taxation Structural Funds. During the period other relevant legislation. The princi- between 2014 and 2020, Lithuania is treaties ple of equal protection means that the expected to receive EUR 6.84 billion As at 1 January 2017, Lithuania laws of Lithuania protect the rights in structural assistance assigned had 53 double tax treaties and lawful interests of both local and to the EU Cohesion policy, which providing for certain tax benefits foreign investors. includes investment in human capital, for foreign investment in Lithuania. infrastructure and public administration. The EU funds are used to upgrade companies and the manu- facturing sector, promote exports, create industrial parks, establish new Lithuania has double taxation treaties product development and testing with the following countries: laboratories, renovate kindergartens Armenia France Luxembourg Slovenia and schools, reconstruct churches Austria Georgia Macedonia Spain and manors, and build hotels, bicycle Azerbaijan Germany Malta Sweden paths and ski runs. Belarus Greece Mexico Switzerland Belgium Hungary Moldova Turkey Both local and foreign micro, small Bulgaria Iceland Netherlands Turkmenistan and medium enterprises as well Canada India Norway UAE as larger companies established in China Ireland Poland Ukraine Lithuania may apply for the non- Croatia Israel Portugal United Kingdom Cyprus Italy Romania USA refundable EU support. Czech Republic Kazakhstan Russia Uzbekistan Denmark Kyrgyzstan Serbia Estonia Korea Singapore Finland Latvia Slovakia

Both foreign and local investors have equal rights in terms of protection of their investments.

12 Business Guide Lithuania 2017 Possible ways of investing in Lithuania

- Establishing a company, acquiring shares/stake in the company - Acquiring property in Lithuania - Acquiring control over the company by granting the loan, etc. - Concluding contracts of concession, leasing and partnership with public/private companies

Free economic zones Kėdainiai FEZ also plays an important Panevėžys FEZ offers access to a wide A free economic zone (FEZ) is a ter- and strong role in attracting foreign pool of employees from a city where ritory designated for the purpose of investment in Lithuania. According to the industries of metalwork, elec- economic-commercial and financial the amount of foreign direct invest- tronics, textile, food and beverages activities where companies enjoy pref- ment per capita in 2015, Kėdainiai have been developed for a long time. erential economic and legal condi- district had the highest rate among There are schools in Panevėžys pre- tions for their operation. Each FEZ is other districts within Kaunas County paring qualified workers in the areas established by a separate law. (6,573 EUR/capita). This rate was of electronics, mechatronics, electri- Currently there are six FEZs operat- 2 times higher compared to Kaunas cal and other kinds of engineering. ing in the following cities of Lithua- County rate. Major investors in eco- Šiauliai region has well-established nia: Kaunas, Klaipėda, Kėdainiai, nomic activities of Kėdainiai district competencies in leather and textile Marijampolė, Panevėžys, and Šiauliai. are from Russia, Denmark and Finland. production, which have enabled it to They host about 60 investors, includ- Baltic FEZ in Marijampolė is located form a cluster now serving the world ing production, logistics, electronics, at a crossroad of wide (Russian stand- renowned brand, IKEA. Additionally, pharmacy, and energy companies. ard gauge) and narrow railway tracks Šiauliai FEZ is specializing in me- An association uniting the six FEZs conveniently accessible by road. chanical engineering, production of operating in Lithuania was estab- It, therefore, provides seamless logis- electrical equipment and home appli- lished at the end of 2015. Its goal tic opportunities of railway and motor ances, and construction materials. is to create 2,000 new jobs and transport across the Baltic Sea Region, attract investments of more than Europe and Asia. Baltic FEZ has been EUR 400 million. established by a team of professionals In 2016, the list of activities that can who are willing to responsibly assist be performed in FEZs was extended, investors in the process of setting up which made them even more attrac- and developing a successful business. tive for the investors. With a superb road, rail and sea access, Klaipėda FEZ forms part of the hub of a multi-modal transport Free economic No tax network. It was identified in the on dividends for foreign European Union Transport Infra- zones investors structure Needs Assessment (TINA) programme as a site for the establishment of a logistics centre, forming a part of the European- wide network No tax on real estate of these centres. No corporate Kaunas FEZ offers both a strategic income tax geographic location and excellent during the first 6 years development conditions. Situated and 50% lower corporate income tax rate (i.e. 7.5%) next to Kaunas International Airport over the next 10 years and in the proximity of the ice-free Klaipėda Seaport, Kaunas FEZ is conveniently accessible via road and railway systems.

Business Guide Lithuania 2017 13 Latvia of charge. Currently, five state-owned IPs (in Alytus, Pagėgiai, Radviliškis, Ramygala and Šiauliai) and several private IPs are being developed. Šiauliai The needs of investors are of primary Klaipėda Radviliškis importance, so land in these indus- Baltic Sea Panevėžys trial parks may be subdivided into Ramygala smaller parts and further leased at Kėdainiai Pagėgiai favourable prices for long-term pe- Kaunas riods. The IPs established in smaller towns are rapidly developing, as they Vilnius Marijampolė can offer cheaper but effective, well- Russia qualified and highly motivated labour Alytus force in addition to favourable real Poland estate rent prices*. Belarus Investment in real estate and land 5 integrated R&D and business centres (valleys) 6 free economic zones (active) Land (except for agricultural and 5 state-owned industrial parks forestry) may be acquired only by 1 technology hub companies or individuals who are established or residing in the EU or in countries that are the members of OECD, NATO or EEA. Such indi- Science and business valleys the park will be able to benefit from viduals and companies are allowed to Overall five integrated science, legal and business consultations, from buy up to 500 hectares of farmland research and business valleys are marketing and other services under (or more if the buyer is a stockbreed- being developed in the territories of much more favourable conditions er), provided that the buyer has at Vilnius, Kaunas and Klaipėda. Each of that are applicable to the park mem- least 3 years of farming experience these valleys specializes in a different bers only. As a result, UK advisory or has completed studies leading to area of scientific research: laser and Alien Technology Transfer has chosen agriculture-related profession. light technologies, civil engineering, Vilnius Tech Park for its first office in Registration of property in Lithuania biotechnology, molecular medicine, CEE region. Annually, the company is smooth and simple. Generally, no nanotechnologies, sustainable chem- helps its clients to attract on average stamp duties are charged on sale/pur- istry and biopharmacy, information over EUR 40 million of investments. chase transactions. Real estate-relat- and communication technologies, In Lithuania, it seeks to bring 40 to 50 ed transactions, however, require no- electronics and organic electronics, innovative start-ups per year between tary’s approval. A notary fee payable and others. 2016 and 2020. by a legal entity on sale/purchase of In February 2013, Vilnius University real estate amounts to 0.45% of the National Scholarly Communication Industrial parks real estate price, but it may not be and Information Centre was opened Lithuania attracts investors not less than EUR 29 and not more than at the Sunrise Valley. It is a part of a only to its FEZs but to its industrial EUR 5,800. Besides, changes in real Sunrise Valley project which attempts parks (IPs), as well. Industrial sites estate ownership rights must be reg- to promote growth of knowledge-in- in Lithuania have already been fully istered with the Real Estate Register. tensive economic activities in Vilnius. prepared for business use and they The amount of the fee charged for the Furthermore, a joint health science have the entire necessary physi- registration of a title to immovable centre accommodating international- cal infrastructure which has been property depends on the type and ly acknowledged biotechnology scien- brought to the investor’s land plot free value of that property. tists and students was opened at the Sunrise Valley in 2015. The National Centre of Physical and Technological Sciences and the Faculty of Chemistry of Vilnius University are being devel- In industrial parks, infrastructure oped at the Sunrise Valley. In November 2016, a new technology is brought to the investor’s land hub Vilnius Tech Park was opened free of charge. in Lithuania. It is by far the biggest technology park in the Baltics and Nordics. It offers offices for start-ups and other businesses within the ICT sector. The businesses established in * Source: www.investlithuania.com

14 Business Guide Lithuania 2017 nd Lithuania ranks 2 in the world for ease of property registration

Lithuanian laws are fully Investment EU compliant, providing protection and safe and transparent guarantees legal framework Lithuanian legislation protects investors’ rights and lawful interests. The laws provide for the rights of an investor to manage, use and dispose of the investment. Foreign investors have the right to legal assistance in the event of violation of their rights and lawful interests. Investment disputes between foreign Investment in a Lithuanian Business reorganisation investors and Lithuania are resolved company Companies in Lithuania may be by way of mutual agreement of the The following exemptions from merged and divided by means of parties, by the courts of Lithuania, taxes are available when investing in reorganisation in line with certain international arbitration institutions a Lithuanian company: conditions set forth in the Lithuanian or other institutions. • there is no capital (stamp) duty on Civil Code, Law on Companies, Law In the event of investment disputes, acquisition of shares; on Corporate Income Tax and other foreign investors have the right to • there is no capital (stamp) duty on legislation. Only the legal entities of refer directly to the International increase in the share capital; the same legal form may be involved Centre for Settlement of Investment • reduction of share capital that was in reorganisation (with some excep- Disputes. formed from reserves and retained tions indicated in special laws). earnings and paid to corporate The cross-border mergers can be residents is not subject to tax as performed according to the Lithua long as the conditions for the nian Law on Cross-border Mergers of participation exemption applied to Limited Liability Companies imple- dividends are met; menting Directive 2005/56/EC. • reduction of share capital that was If properly structured, mergers are formed from shareholders’ contri- tax neutral. butions is not subject to tax.

All office buildings in Lithuania were Modern and affordable office space mostly built after 2005. As a result of a number of large real estate development Location Total vacant area Average price EUR/m²/month projects, the total modern office space of office space, m² was significantly increased in Vilnius in Class A Class B 2015 and 2016. In 2015, two modern, Vilnius 32,400 13.5 – 16.5 8.5 – 13.0 cosy and convenient business centres – Kaunas 3,750 10.5 – 13.0 6.0 – 10.0 K29 and Premium – were opened, pro- Klaipėda 11,989 8.5 – 12.5 6.0 – 9.0 viding over 26,000 m² of Class A office space. The year 2016 proved to continue Source: www.ober-haus.lt the same trend, by opening two additional business centres – CITY and Quadrum (I stage), thereby providing additional 42,500 m² of office space.

Business Guide Lithuania 2017 15 Labour

In September 2016, a new version ment agreement. The Lithuanian • project-based agreement is con- of the Lithuanian Labour Code version of the employment agreement cluded for the purpose of achieving was adopted to take effect in 2017. may be accompanied by an equivalent the specific work results; The new version of the Labour Code version in any foreign language. • employment agreement for sharing focuses on liberalization of employ- Foreign law may be applied to an a work place is a contract based on ment relations, by making them more employment agreement, provided which 2 employees share one work flexible, reducing an administrative the employment relations have place, but do not exceed the maxi- burden for employers, and encourag- a cross-border element. Despite such mum working time per employee; ing foreign investments in Lithuania. agreement, however, the Lithuanian • employment agreement for work The new Labour Code codifies mandatory rules would prevail if for several employers is concluded the existing case-law and removes the actual place of workplace of the by two or more employers and an the legal uncertainty surrounding employee under the employment employee employed to perform the current employment relationships agreement is in Lithuania. the same functions. It is, however, (for example, in respect of non-com- important to indicate the main petition agreements of employees, Types of employment employer responsible for work overtime rates members of manage- agreements scheduling, payment of social secu- ment bodies and management staff, An employment agreement in Lithua- rity contributions, etc.; etc.). The new Labour Code has also nia is usually concluded for an indefi- • seasonal agreement (for up to 8 opened the following new possibili- nite period. Based on the new Labour months during a year) is concluded ties to the employers: Code, however, new types of employ- if the work is seasonal in nature. • new types of employment agreement agreements may be chosen as A probationary period may be estab- ments have been introduced to more acceptable, depending on the lished in employment agreements. meet the needs of businesses; needs of businesses: The maximum probationary period • working time can be extended • fixed-period agreement is con- is three months. easier than it used to be before, cluded for a certain period of time and there are more possibilities to (for up to 2 years in case of assign- choose between the most accept- ing the same functions; for up to 5 Working able working time regime (flexible years in case of assigning of differ- conditions working hours, individual working ent functions) or for the period of Working time hours, split working hours); performance of the specific work. An average working time for an • employment agreements can be ter- The number of fixed-term employ- employee should not exceed 48 hours minated easier and at a lower cost. ment agreements concluded for per week (which may be extended up the work of permanent nature to 60 hours per week for employees Conclusion of must not exceed 20% of all em- working in several positions), and ployment agreements concluded twelve working hours per day. A five- employment by an employer; day working week is standard, but it agreement • temporary agreement (for a fixed may be extended to a six-day working period of up to 3 years or for week. Overtime must not exceed 12 Structure of employment indefinite period) is concluded hours in seven consecutive days and agreement with a temporary employee who is 180 hours per year, unless a collective An employment agreement must employed by a temporary employ- employment agreement provides for contain the main employment provi- ment undertaking (the employer), more than 180 hours per year. sions: the employee’s place of work, although the duties under the job duties and remuneration. Accord- employment agreement are per- ing to the new Labour Code, a new formed for the benefit of the user form of employment agreement may of temporary work; be introduced and, depending on the needs of the employer, a confidential- ity undertaking or a non-competition agreement (providing for an adequate compensation) may be concluded EUR 380 with an employee. The confidential- minimum wage per month (gross) ity undertaking will remain in force for 1 year after the termination of the EUR 2.32 per hour employment relations, unless a longer period is established in the employ-

16 Business Guide Lithuania 2017 Holidays State social The minimum annual paid holiday entitlement is 20 working days or security issues 24 working days (if a working week The Lithuanian state social insurance consists of 6 days). scheme includes insurance for pen- Additional annual holiday benefits are sions, health, illness and maternity possible for certain groups of employ- paternity, child care, unemployment, ees (e.g. disabled persons, employees accidents at work and occupational under 18 years of age, employees work- diseases. There is no statutory re- ing in abnormal/harmful conditions). quirement for the employers to pro- Annual paid holiday leave must be vide additional individual insurance granted in the same working year. to their employees. EUR 772 If an employee is not able to use the However, additional insurance might average wage holiday leave in full during the same be required for the company in con- working year, the unused days are nection to its business activities in per month (gross) transferred to the next year. Lithuania (e.g. insurance of profes- When employment agreement is ter- sional/commercial liability). minated, the unused annual leave days are subject to compensation only for the last three years of employment.

Termination of employment agreement

Cases of employment termination Grounds for termination Notice period* Severance payment Expiry of fixed-period Expiry of the term provided for - 5 working days if employment 1 average monthly salary is paid employment agreement in the fixed-period employment relations last for more than if employment relations last more agreement a year than 2 years - 10 working days if employment relations last for more than 3 years Expiry of temporary Expiry of the term provided for 5 working days. The notice period N/A employment agreement in the temporary employment indicated in the collective agree- agreement ment (if it is concluded) must not exceed 14 calendar days Mutual consent between Written agreement on the ter- An offer to terminate an employ- N/A the parties mination of the employment ment agreement must be accept- agreement ed within 5 working days. If the offer is not accepted, employment relations are not terminated On the initiative of an employee Serving to the employer a prior 20 calendar days N/A and for no important reasons written notice On the initiative of an employee Serving to the employer a prior 5 working days - 2 average monthly salaries and for important reasons written notice - 1 average monthly salary if employment relations last less than a year Without the fault of an employee Reasons related to economic and - 1 month - 0.5–2 average monthly salaries technological aspects, restructur- - 2 weeks for employees working - A long-service benefit may be ing of the company’s activities, less than a year paid according to the uninter- performance of an employee, etc. - A longer notice period (double rupted service period of the or triple) for certain categories of employee employees (e.g., for employees raising children under 14 years of age or persons of pre-retire- ment age) Fault of an employee - Gross breach of employment N/A N/A duties, such as disclosure of commercial information, unrea- sonable absence from work for a whole day, etc. - Repeated breach of employment duties within the last 12 months On the initiative of an employer For no important reasons 3 working days 6 average monthly salaries Without the initiative of an Upon an effective court decision, N/A In some cases, 0.5-1 average employer or an employee when an employee is unable monthly salary to perform employment duties or work according to a medical conclusion, etc.

* Termination of employment agreement during the probationary period is permissible with 3 days’ notice either on the initiative of the employee or the employer

Business Guide Lithuania 2017 17 Immigration & permits EU citizens EU citizens and their family members are free to stay and work in Lithuania. Even if the family members of EU citizens are non-EU citizens, they are issued a residence certificate of a family member of an EU citizen. Non-EU citizens A non-EU citizen needs a visa to enter Lithuania, unless a visa-free regime Lithuania is a Member State of the is applied. European Union (EU) and a member Diplomatic missions or consular posts of the Schengen Area, therefore, the of Lithuania in foreign countries issue Lithuanian immigration laws were set visas to non-EU citizens who intend in accordance with the EU regulations. to travel to Lithuania. The procedure Thus, any EU citizen is free to stay in and necessary documentation depend Lithuania nearly without any legal on the requirements of a particular obligations. Non-EU citizens (foreign diplomatic mission or consular post nationals) might be subject to addi- of Lithuania. If a non-EU citizen stays tional requirements. in Lithuania for a period longer than 3 months, a temporary or permanent residence certificate or, in certain cases, a national visa should be obtained. A non-EU citizen must submit an application for a residence permit and other documents to a diplomatic mission or a consular post of Lithua- No work permits are required nia abroad. A non-EU citizen who is for EU citizens lawfully staying in Lithuania (holding a visa), must submit the application to the Migration Department in the mu- nicipality of Lithuania in which he/ she intends to reside. Such lodging of application, however, does not entitle a non-EU citizen to stay in Lithuania before the application has been exam- ined and a decision on the issue of a residence permit has been adopted.

No actions Temporary Permanent are required residence residence upon entry certificate is certificate is required required

< 3 months > 3 months > 5 years

18 Business Guide Lithuania 2017 The EU Blue Card allows working and living in Lithuania.

Work permit If a non-EU citizen intends to work in Intra-group secondments often fall under Lithuania, a work permit is required. The requirement to have a work the exemption from the requirement permit applies to both, short and to obtain a work permit. long-term stay cases. The main exemptions from the requirement to obtain a work permit are as follows: • when a non-EU citizen stays in Lithuania for up to 3 months: to negotiate a contract or the terms of its implementation; to train The EU Blue Card – employment • when the salary proposed to personnel; or to install equipment; of highly skilled non-EU citizens a highly skilled employee is • when a non-EU citizen is posted The Blue Card is a 2-in-1 (work and greater than three national aver- to Lithuania as a manager or a residence permit) allowing highly age gross monthly wages (approx. specialist from other group com- skilled non-EU citizens to work and EUR 2,380 in total), or pany for the period no longer than live in Lithuania. Highly skilled em- • when the salary proposed to an 3 years to perform highly skilled ployees are not only employees hold- employee holding a profession list- work necessary to ensure further ing higher education diplomas, but ed among the professions requir- activities of the Lithuanian com- also employees who have no less than ing higher professional qualifica- pany, provided he/she has been five years of professional experience. tion and lacking in the Lithuanian employed with such other group When a Lithuanian employer wants labour market is at least 1.5 times company for at least 1 year; to obtain the EU Blue Card for an of the national average gross • when a non-EU citizen holds a employee, it is required: monthly wage (approx. EUR 1,190 profession which is listed among • to apply to the Lithuanian Labour in total), or the professions requiring higher Exchange Office and register a va- • when the EU Blue Card is renewed professional qualification and lack- cancy, and after two years of non-EU citizen’s ing in Lithuania. • to obtain the decision from the employment in Lithuania. In order to employ a non-EU citizen, Lithuanian Labour Exchange Office The EU Blue Card is issued within Lithuanian employers are required: that the employment of a highly one month and is valid for up to three • to apply to the Lithuanian Labour skilled foreigner meets the require- years. Foreigners who stay in Lithua- Exchange Office and register ments of the Lithuanian labour nia to work for the group company a vacancy; market, and and their salary is greater than two • to obtain the work permit from • to pay an employee a salary of at national gross monthly average wages the Lithuanian Labour Exchange least 1.5 times of the national aver- (approx. EUR 1,587 in total), are able Office before a foreign national age gross monthly wage (approx. to apply for the residence permits for arrives to Lithuania. EUR 1,190 in total). their family members as well. It is important to note that in some There is no requirement to obtain the If employee intends to change the em- cases the Labour Exchange Office has above-mentioned decision from the ployer during the first two years, the to be informed about the intention Lithuanian Labour Exchange Office permission of the Migration Depart- to register a vacancy three months and to search for employees in the ment is required. before submitting the application for Lithuanian and EU labour markets registering the vacancy, and that the in the following cases: vacancy has to be registered 1 month before submitting the application for the work permit.

Start-up visa is available in Lithuania.

Business Guide Lithuania 2017 19 The tax system

The Lithuanian tax system is adminis- Modern tax administration The Tax Authority will be collecting tered by the following official institu- The Lithuanian tax administration data from tax payers in new XML tions: the Lithuanian Tax Authority, system is progressive and convenient reports, and will use this data for the Customs Authority, the Social for the tax payers. control purposes. Insurance Authority, and institutions As from 1 October 2016, the taxpayers From 1 October 2016, companies are authorised by the Lithuanian Ministry have to file all tax returns electroni- required to submit shipment docu- of Environment. cally, with some exceptions. ment data in XML format to i.VAZ The system of taxes and duties in To reduce the administrative burden system on local transport of goods Lithuania consists of direct and indi- for the companies, a single payment before each shipment. For the tax pe- rect taxes, the major of which are: and submission deadline has been set riods starting from October 2016, all • corporate income tax, • VAT, • personal income tax, • social security contributions, • property taxes, Lithuania has jumped two positions in the 2017 Paying • excise duties, Taxes report thanks to its quick VAT refund procedure, • customs duties. less sophisticated and less time consuming CIT audits, Appeal procedures and a low administrative burden for tax payers Any person who disagrees with the during VAT refund and CIT audit procedures. decision of the Tax Authorities has the right to lodge an appeal. The de- cisions taken by the Tax Authorities may be appealed against within for the majority of tax payments and persons registered for VAT in Lithua th 20 or 30 days. tax returns, which is the 15 day of nia are required to submit invoice If taxpayers are dissatisfied with the particular month. data in XML format to i.SAF system the result of the first-stage appeal, If tax payers have any questions about on a monthly basis. they may appeal to the courts or to the submission of tax returns or taxa- With effect from 2017, companies a non-obligatory pre-trial tax litiga- tion matters, they can call the Tax Infor- will be required to prepare a SAF-T tion institution (the Commission on mation Centre and get advice directly (Standard Audit File for Tax) in XML Tax Disputes under the Lithuanian from the specialists of the Tax Authority format and provide it to the Tax Government) hearing tax disputes acting as a single point of contact. Authority, Customs, or other public between a taxpayer and the Tax authority upon request. Authority. The absolute majority of i.MAS – intelligent tax New data reporting requirements all tax disputes go through the Com- administration in Lithuania should contribute to a more effec- mission on Tax Disputes due to its The Lithuanian Tax Authority has tive and modern tax administration competence in taxes. introduced an IT-based tax adminis- in Lithuania, which aims at decreas- tration system (“i.MAS”). ing the scale of shadow economy and tax gaps.

Information exchange i.MAS introduction stages As from 1 January 2016, Lithuania adopted information disclosure requirements related to international Group II transparency movements (such as FATCA (Foreign Account Tax Compli- Group I • Smart cash Group III (from October 2016) registers ance Act) and Common Reporting • Accounting application Standard of OECD) in the national for small businesses • Invoice data • Standard audit file law. Financial market participants filling system for tax – SAF-T • Tax payers’ as well as legal entities are obliged • Electronic shipment control system to provide the Tax Authority with document system certain information. • Analysis, modelling, risk management system

20 Business Guide Lithuania 2017 Business Guide Lithuania 2017 21 Corporate income tax (CIT) 15% CIT The standard CIT rate Tax residence is 15%, which is one of A company is treated as a Lithuanian the lowest in the EU. tax resident for CIT purposes if it is incorporated in Lithuania. No other tax residence rules apply. 5% The reduced CIT rate Tax base of 5% applies to: For local Lithuanian companies, • small companies which 0% the tax base comprises all income meet certain conditions; The reduced CIT rate sourced inside and outside Lithuania. • companies involved in of 0% applies to compa- agricultural activities nies that, inter alia: Exemption is applied to income and which meet certain • employ certain groups earned through permanent establish- conditions. of people eligible for ments in European Economic Area social support; (EEA) countries or countries which • are established in a FEZ (for the first 6 years). have a Double Taxation Treaty (DTT) with Lithuania. For foreign companies, the tax base comprises income generated from business activities carried out through Anti-avoidance rules countries, as well as Lithuania permanent establishments in Lithua- Lithuania has a general anti-avoid- (aiming to become an OECD mem- nia and other specific income sourced ance rule. Based on this rule, the ber), have already started implement- in Lithuania, such as: Tax Authorities have a right to tax ing certain provisions related to BEPS • interest, a transaction based on its substance package into their tax legislation • dividends, rather than its formal documentation (e.g. related to dividends paid and • royalties, when the aim of the transaction is to received). Other BEPS recommenda- • proceeds from rent/sale of immov- get a tax benefit. tions are expected to be transferred able property, etc. Lithuania also has specific anti-avoid- into Lithuanian legislation by 2024. ance rules, including: Computation of taxable profit • thin capitalisation rule; Incentives to holding companies A Lithuanian company/foreign • rules on taxation of controlled Capital gains on transfer of shares company’s permanent establishment foreign corporations; are exempt from CIT if a Lithuanian adjusts its profit before taxes taken • transfer pricing rules; company: from its financial statements prepared • some other specific rules. • transfers the shares of the company under the Lithuanian Business Ac- which is registered in EEA country counting Standards or International Base Erosion and Profit Shifting or in another country with which Financial Reporting Standards by the (BEPS) Lithuania has a DTT, and amounts of non-deductible expenses The OECD has announced a package • has held over 25% of shares of (penalties, expenses related to non- of BEPS recommendations aiming to the aforementioned company taxable income, etc.) and non-taxable increase transparency of international for not less than 2 years (not less income (dividends, insurance pay- taxation and prevent tax evasion and than 3 years in the event of ments, penalties received, etc.). aggressive tax planning. Many OECD reorganisation).

Tax losses carried forward Operating tax losses can be carried forward for an indefinite period. Loss- es incurred from disposal of securities Operating tax losses can be carried forward can be carried forward for a period for an indefinite period. Transfer of tax losses of five years and can only be offset against income of the same nature. between group companies is allowed. Only up to 70% of current year’s taxable profits can be offset against tax losses carried forward.

Capital gain exemption Intra-group transfer of tax losses Tax losses can be transferred from is available on sale of shares. one company to another within the same group of companies and within the same tax period if certain conditions are met.

22 Business Guide Lithuania 2017 Companies may benefit from investment, R&D, film production and FEZ reliefs.

Transfer pricing rules Binding rulings and advanced Thin capitalisation rules All transactions between associated pricing agreements The Lithuanian thin capitalisation parties must be performed at arm’s There is a possibility to apply for rules apply in respect of borrow- length. The Tax Authority has a right a binding ruling or advanced pric- ings from related parties as well as to adjust transaction prices if they do ing agreement (APA) from the Tax borrowings guaranteed by related not conform to market prices. Authority in respect of the future parties. The maximum debt to equity The Lithuanian transfer pricing rules transactions. It takes about two ratio is 4:1. Interest on related-party refer to the Transfer Pricing Guide- months to receive the ruling and it is loans exceeding this ratio is treated lines for Multinational Enterprises binding to the Tax Authority for five as non-deductible for tax purposes. and Tax Administrations prepared by years. The majority of the binding As a result of BEPS initiative, new the Organisation for Economic Coop- rulings and APAs are in favour of interest limitation rules related to eration and Development (OECD) to the tax payer. the company’s EBITDA may be intro- the extent that they do not contradict duced in Lithuania. However, there with the domestic rules. Non-binding rulings have been no specific plans yet in All companies with annual revenue It is a common practice to ask for non- this respect. exceeding EUR 2,896 million, as well binding rulings from the Tax Author- as all banks, insurance companies and ity, as the procedure is simpler and Amortisation of goodwill credit institutions are required to pre- quicker compared to the procedure There is a possibility to recognise pare transfer pricing documentation of binding rulings. goodwill for tax purposes in Lithua- in a specifically prescribed form. Non-binding rulings protect the tax nia. Tax goodwill can be amortised As from 1 January 2017, general man- payer from penalties and penalty over 15 years if certain conditions agers of companies that fail to comply interest if the Tax Authority changes are met. with the above-mentioned require- its opinion in the future. In practice, ment for the transfer pricing docu- however, the Tax Authority does Tax compliance mentation may be subject to a penalty not tend to change its opinion if the The taxable period for CIT is usu- ranging from EUR 1,400 to 4,300. circumstances are fully disclosed in ally a calendar year. The tax return the request for the ruling. has to be filed and CIT due has to be paid once per year. Having obtained the permission from the Tax Author- ity, the companies may use a taxable Effective CIT rate in Lithuania is period other than a calendar year. The companies are also subject to 5.9% advance CIT payment in Lithuania.

Special CIT reliefs

Relief Main benefits of the relief Investment project relief The companies implementing investment projects are entitled to double deduction of costs of fixed assets meeting certain requirements by: - reducing immediately their taxable profit by up to 50% of such costs (the costs exceeding a 50% limit can be carried forward for 4 years); - depreciating such fixed assets in a common manner. Taxable profit can be reduced by deducting these costs if they are incurred in 2009-2018 taxable periods. Research and Development (R&D) Expenses (except for depreciation (amortisation) charges of fixed assets) incurred for R&D works may be relief deducted three times during the tax period in which they are incurred. The deduction is possible without taking into account the results of R&D activities. Tax relief for Free Economic Zone FEZ companies with capital investments not less than EUR 1 million or EUR 100 thousand (depending on (FEZ) companies the nature of activities that the company performs) and which meet certain other conditions are exempt from CIT for the first six years following the date of the capital investments, and they are subject to a 50% reduction in CIT rate for 10 subsequent years. Tax relief for funds granted for film Companies are entitled to reduce their taxable profits and CIT payable by the amount of support granted, production provided the films meet the defined cultural content and production criteria. As a result, the company granting the support could get a cash-back from the budget, i.e. a grant of EUR 100 would result in EUR 111.25 cash-back from the budget. Certain conditions apply. Bad debt relief In case the debts are not recovered for longer than 12 months, the company could reduce its taxable profit by the amounts of such bad debts. Certain restrictions apply.

Business Guide Lithuania 2017 23 Withholding tax (WHT) Certain income sourced in Lithua nia and received by a foreign entity otherwise than through its permanent establishments in Lithuania is subject to WHT. The withholding tax return has to be filed and the tax due has to be paid on a monthly basis after the payment has been made.

Withholding tax

Type of payments subject to WHT Taxation rules Dividends - Dividends paid to foreign/Lithuanian companies are not subject to WHT if the recipient has held not less than 10% of voting shares of the paying company for a continuous period of at least 12 successive months. This relief does not apply if the recipient of dividends is registered in blacklisted territories. - Dividends received by a Lithuanian company from foreign companies are not subject to taxation in Lithuania if a foreign company is registered in a country of European Economic Area (in this case no participation or holding limits are applied). - Otherwise, i.e. if exemptions described above are not applicable, dividends paid out to foreign/ Lithuanian companies are generally subject to WHT at a rate of 15%. - As from 26 March 2016, dividends paid out to foreign/Lithuanian companies are no longer subject to tax exemption in cases where tax benefit is the main or one of the main objectives of a particular structure of companies. Dividends received from foreign companies would not be subject to tax exemption if they were deducted from taxable profit at the distributing company level. Interest - Interest paid from Lithuanian companies to foreign companies established in the European Economic Area or in countries with which Lithuania has a DTT is not subject to WHT in Lithuania. - Otherwise, interest sourced in Lithuania and received by a foreign company is generally subject to WHT at a rate of 10%. Royalties - Royalties paid to the qualifying related parties, EU tax residents, are not subject to WHT in Lithuania. - Otherwise, royalties sourced in Lithuania and received by a foreign company are generally subject to WHT at a rate of 10%. Proceeds from the sale or lease - Such proceeds received by a foreign company are subject to WHT at a rate of 15%. of immovable property located in Lithuania Proceeds from performers’ or - Such proceeds received by a foreign company are subject to WHT at a rate of 15%. sports activities carried on in Lithuania Payments to the Board and - Such proceeds received by a foreign company are subject to WHT at a rate of 15%. Supervisory Board members

0% WHT rate typically applies to payment of dividends and interest

24 Business Guide Lithuania 2017 Business Guide Lithuania 2017 25 21% VAT The standard VAT rate is 21%, which is applied to most supplies of goods and services in Lithuania. Special VAT reliefs • Doing business involving a Lithuanian warehouse? 9% Check the call-off stock simplifi- The reduced VAT rate cation and save costs. of 9% applies to: 5% The reduced VAT rate of 5% Foreign companies that bring goods • books, newspapers, other applies to: printed material; to Lithuania and sell them on from • pharmaceuticals, subject • public transport services; there without having an establish- to restrictions; • heating of residential premises • technical aid devices and ment in the country may avoid (abolished from 1 June 2017); their repair for disabled Lithuanian VAT registration require- • hotel accommodation. persons. ment and VAT compliance costs if they use the VAT call-off stock simplification. A Lithuanian warehousing service provider may take care of VAT obligations of the foreign companies using its own local VAT number. • Having bad debts including VAT? Make use of the VAT relief for bad debts. Value added tax Supply, chartering, rent, fuelling, Lithuanian VAT payers can recover provisioning of vessels navigating on output VAT that has been paid by (VAT) the high seas and aircraft mostly used them to the Tax Authority but has The Lithuanian VAT legislation is for transport services may be subject never been paid to them by their aligned with the EU VAT legislation. to a 0% VAT rate. clients. The period for a client’s debt Thus, the Lithuanian VAT system does If a 0% VAT rate applies, it is still to be considered as a bad debt is gen- not differ from those in any other EU possible to deduct input VAT on erally 12 months from the date of the Member State. purchases with 21% VAT, and refund supply of goods or services. In some The standard VAT rate is 21%. While a VAT overpayment in cash from the cases, the VAT on bad debts may be keeping the base for reduced VAT Tax Authority. recovered even prior to the expiry rates (9%, 5%) quite narrow, Lithua Financial, insurance, health and edu- of 12 months. nia allows a variety of VAT exemp- cation services may be exempt from • Planning to restructure your tions and VAT reliefs, which help busi- VAT, but without giving rise to a right business? nesses to keep their administrative to deduct input VAT incurred. Make sure the transfer of a busi- costs lower and save their cash flows. As a general rule, sale of real estate is ness is VAT free. exempt from VAT. The exemption may If a taxable person transfers his VAT exemptions apply to old buildings and agricul- business or a part of it as a complex As a rule, all the supplies should be tural land unless the seller opts to tax to another taxable person, such taxed with VAT at the standard or re- such transaction. a transfer may be not subject to VAT duced VAT rate. Some supplies do not Sale of new buildings (i.e. before ex- in Lithuania. This relief reduces cash have to be taxed at all. VAT legislation piry of 24 months after their comple- flow issues for companies involved provides for more detailed rules on tion or reconstruction) are subject to in a deal. such cases. a 21% VAT rate. The same applies to • Releasing non-EU goods for free A 0% VAT rate applies to supply of building land. circulation in Lithuania? goods transported from Lithuania to Long-term rent of residential prem- Save cash flows by making no another EU Member State or outside ises and any rent of non-residential import VAT payments. the EU. Services related to such sup- premises may be exempt from VAT, Lithuanian VAT payers importing plies may be zero-rated, as well. unless the lessor opted to tax such goods from non-EU countries to transactions. Lithuania can avoid the actual import VAT payment to the Customs Author- ity and thereby save their cash flows. Import VAT may be reported as pay- No advance VAT payments able and as deductible in the same VAT return.

26 Business Guide Lithuania 2017 Simple VAT rules for e-invoicing and e-archiving

• Having high VAT costs due to E-invoicing and e-archiving VAT reporting is easy VAT-exempt supplies? Lithuanian VAT legislation allows us- For VAT compliance, Lithuanian VAT Check the option to tax ing quite simple electronic invoicing payers are required to file a one-page VAT-exempt transactions. and archiving solutions that help to VAT return and pay VAT to the Tax If real estate is acquired with VAT, reduce the level of consumption and Authority on a monthly basis. owners of real estate may opt to tax eliminates the need for keeping paper A European Union Sales List must be real estate supply or rent and avoid invoice archives. Even PDF invoices filed in addition to VAT return only the VAT costs. The option may usually sent by email to clients may be treated if goods or services are supplied to be exercised if the client is a VAT-reg- as proper invoices that do not need to other EU Member States. istered business or a VAT-registered be printed out. In addition to the above-mentioned individual conducting a business. VAT reporting requirements, as If opted to tax real estate transactions, VAT registration within 3 days from 1 October 2016, all VAT payers VAT is charged for at least 24 months Local companies and individuals (including the foreign companies reg- on the same type of transactions. must register for VAT purposes if their istered for VAT purposes in Lithuania) There is an option to calculate VAT turnover exceeds EUR 45 thousand are required to submit their invoice on particular financial transactions for a period of 12 successive months. data in XML files to the Lithuanian as well, for instance, on loan interest No threshold applies to foreign tax- Tax Authority on a monthly basis. received from a group company. able persons which have an obligation • Providing construction services? to register for VAT purposes from Brief list for irrecoverable Check local reverse charge VAT the commencement of their business input VAT rules. activities in Lithuania. A VAT num- In general, VAT cannot be recovered As from 1 July 2015, the companies ber should be obtained before any on any expenses that are not related providing construction services are supply is made. to supplies taxed with VAT. not obliged to pay output VAT. Output The VAT registration may be a com- The Lithuanian list of specific pur- VAT is calculated and can be deducted plex process but it is definitely a quick chases not eligible for VAT recovery by the purchaser of the services. one. A local company or resident is extremely short: The new mechanism allows saving individual may obtain a VAT number • 100% VAT on purchase and rent of cash flows for the service provider. within 3 business days. a passenger vehicle, but VAT on car • Involved in VAT-exempt business? Companies established in other fuelling and maintenance may be Check the applicable cost shar- EU Member States may be directly recovered at 100%; ing exemption and reduce your registered for VAT purposes, whereas • 25% VAT on business representa- VAT costs. companies registered in non-EU tion expenses. Services provided between the mem- countries must appoint a jointly liable A part of irrecoverable input VAT may bers of the group of companies can fiscal agent who will take care of all still be recovered by deducting it as be treated as VAT exempt, provided the VAT obligations. an expense from the taxable income certain conditions are met. for CIT purposes.

Recoverable VAT Option to tax on bad debts VAT-exempt Import VAT supplies payment deferral

Quick and simple Call-off stock Local reverse VAT refund simplification charge VAT on VAT-free transfer procedure construction of a business services

Business Guide Lithuania 2017 27 Personal income tax 5% PIT The reduced PIT The tax year 15% rate of 5% applies to A flat PIT rate is 15% The tax year is a calendar year. income from certain Income is taxed when it is actually individual activities received, and the PIT compliance requirements and payment deadlines depend on an individual’s residence status for tax purposes.

Tax residence A Lithuanian tax resident is deemed to be any of the following: • an individual whose permanent Payroll taxes paid directly to the state budget on place of residence during the tax an individual’s behalf from other individual’s year is in Lithuania, or funds are non-taxable benefits in Lithuania. • an individual the location of whose personal, social or economic interests during the tax year may be considered to be in Lithuania rather than in a foreign country, or There are no taxes on wealth in Lithuania. • an individual who stays in Lithua- nia, continuously or intermittently, for 183 or more days during the tax year, or types of income sourced in Lithuania. Non-taxable income • an individual who stays in Lith- The list of income is exhaustive, but There is also a wide list of non-taxable uania, continuously or intermit- the main are the following: income, such as: tently, for 280 or more days during • employment income; • contributions made by an employer two successive tax years and who • income from distributed profits on behalf of an employee, such as stays during one of such years in and payments to the members life insurance premiums, addi- Lithuania continuously or intermit- of the Management Board or the tional (voluntary) health insurance tently, for 90 or more days. Supervisory Council; contributions and pension contri- • interest, except for interest re- butions, provided that the total Tax base ceived on the Lithuanian Govern- amount of such contributions does Lithuanian tax residents are taxed ment’s bonds; not exceed 25% of the employee’s on their worldwide income, by taking • income from the sale/lease of annual employment-related income into account the provisions of the ef- immovable property located in (special conditions also apply); fective DTT. Lithuania, etc. • interest income on deposits kept at Employment income can be reduced Non-residents can also reduce their banks and other credit institutions, by pre-determined tax-exempt taxable employment income sourced non-equity securities and non-equity amounts for individuals earning in Lithuania by an annual tax-exempt government securities, provided the low salaries, and by an additional amount after the end of a calendar amount does not exceed EUR 500 tax-exempt amount for Lithuanian year, provided they receive less than and the deposit agreement was con- residents raising children (additional the pre-determined amount of taxable cluded or securities were acquired conditions apply). Social security worldwide income. after 1 January 2014; contributions (SSC) are not deductible for PIT purposes. Lithuanian tax residents may also deduct from their taxable income life insurance premiums, pension contri- Status of tax returns and tax balance butions paid to pension funds or pay- statistics are available online 24/7. ments for vocational training or studies (special conditions apply in each case), provided that these expenses do The Tax Authority provides pre-filled Electronic personal income tax returns based on not exceed 25% of the amount of tax- data provided by employers and other declaration able income received over the tax year. third parties. system (EDS) The total deductible life insurance premiums and pension contributions amount should not exceed EUR 2,000. A pre-filled tax return can be Lithuanian tax non-residents are sub- submitted by one click. ject to the Lithuanian PIT on certain

28 Business Guide Lithuania 2017 • profits from transfer of shares or Social security Ukraine, Russia, Canada, the USA, other securities not exceeding the Netherlands, Moldova, the EUR 500 (additional conditions Social security base Czech Republic, Estonia and Latvia. also apply); Individuals working under an employ- The agreements with Belarus, • income from the sale of housing ment agreement in Lithuania must be Ukraine, Canada and Moldova regu- (including land) located in a EEA covered by a social security scheme. late the payment of SSC, therefore, member country, provided the Lithuanian employers also contribute foreign employees seconded from individual’s place of residence was certain amounts to the Guarantee the aforementioned countries to declared there during the last two Fund in order to protect employees Lithuania who obtain relevant cer- years prior to the sale; if the employers become insolvent. tificates on social security coverage • income received as a gift from Payment of SSC is also compulsory in their home countries are also not spouse, children (adopted chil- on income received from distrib- required to pay SSC in Lithuania. dren), parents (adoptive parents), uted profits by the members of the Employees temporarily seconded to brothers, sisters, grandchildren Management Board or Supervi- Lithuania from the third countries, and grandparents, etc. sory Council and on other income with which Lithuania has no recipro- received by them as a remuneration cal social security agreements, are not Double taxation elimination for the fulfilment of member func- required to pay the Lithuanian SSC as Residents are entitled to a relief from tions. Payment of SSC is also com- well, unless their permanent place of double taxation under an effective pulsory for self-employed individu- employment becomes Lithuania. DTT. According to the domestic leg- als, individuals receiving income islation, income (except for interest, under copyright agreements, etc. Social security compliance dividends and royalties) received by SSC should be paid and reported on a resident of Lithuania in a foreign Contribution rates a monthly basis. For the insurers, it country, which is an EU Member State Employed individuals are subject to is mandatory to use an advanced sys- or with which Lithuania has a valid SSC at a rate of 9%, and employers tem of e-services (“EDAS”) to provide DTT, is tax exempt in Lithuania. are required to pay SSC of approx. the information to the Social Secu- Residents can also deduct the tax 31% on gross amount of employ- rity Authority. By one click, the users actually paid on income sourced in ment-related income. Employer’s can check the history of documents third countries (not exceeding 15% share of SSC depends on the level submitted and payments made. of PIT payable on such income in of accidents at work and profes- EDAS simplifies the preparation and Lithuania), provided that support- sional diseases. submission of information, helps to ing documentation from a foreign The members of the Management save time and improves efficiency. tax administrator is provided to the Board or Supervisory Council, who Lithuanian Tax Authority. receive income from distributed Social security benefits profits and other remuneration, Individuals who contribute to the Tax compliance are obliged to pay pension insurance Lithuanian social security system, Lithuanian companies making pay- contributions, and their total SSC depending on their form of activ- ments to individuals (with certain ex- amount to 3%, whereas the compa- ity and the types of contributions ceptions) must withhold and pay PIT nies making such payments are also paid, are entitled to receive sickness to the state budget as well as declare subject to SSC at an approximate allowances, free healthcare from it on a monthly basis. rate of 23%. public healthcare service providers, There are no tax assessments avail- maternity/paternity and childcare able in Lithuania. Lithuanian tax International social security allowances, unemployment ben- residents having an obligation to file The Lithuanian legislation on social efits, benefits for accidents at work annual income tax returns and pay security has been harmonised with and occupational diseases, old age, PIT or wishing to apply tax-exempt the EU regulations. Foreign employ- disability and widows’/widower’s/ amounts/deductions and receive ees seconded to Lithuania from the orphans’ pensions. When granting a refund, have to submit their tax EEA or Switzerland and their em- social benefits, insurance records returns and pay (if applicable) the re- ployers are not required to pay SSC in acquired while working abroad are lated PIT before the 1st of May of the Lithuania if A1 certificate is obtained. accumulated according to the provi- following calendar year. No tax return The reciprocal social security agree- sions of the EU regulations and the filing extensions are allowed. ments exist between Lithuania and Lithuanian insured income received Lithuanian tax non-residents who the following countries: Belarus, is taken into account. have an obligation to file income tax returns and pay PIT to the state budget on the reported income are required to proceed on a monthly basis accordingly, within 25 days from the SSC are not applicable to employees who receive actual receipt of such income. shares under stock option plans after a three-year period following the day on which the right to receive shares was granted to them.

Business Guide Lithuania 2017 29 Other taxes

Other direct taxes

Tax Tax base Tax rate Real estate tax The tax is levied on the value of immovable The tax rate ranges from 0.3% to 3% property. depending on local municipalities. Land tax The tax base depends on the average The tax rate ranges from 0.01% to 4% market value of land. depending on local municipalities. Land lease tax The tax base depends on the average The minimum tax rate is 0.1% and the market value of the leased state-owned land. maximum tax rate is 4%. Lottery and gaming tax For the organisers of lotteries, the tax base For the organisers of lotteries, the tax rate is the nominal value of lottery tickets put is 5%. into circulation. For the organisers of bingo, totalizator and For the organisers of bingo, totalizator and betting – the tax rate is 15%. betting, the tax base is the amount of income The organisers of games with gaming less the winnings actually paid out. machines and table games must pay fixed fees established for each gaming device. Pollution tax The tax is levied on stationary and mobile The tax rates vary depending on the type pollution sources used for commercial and toxicity of the pollutant in question. purposes, as well as on imported or produced certain filled packaging and specified products.

Customs duties Excise duties The Union Customs Code (UCC) as Excise duties are imposed on the fol- per Regulation EU 952/2013 is ap- lowing goods: plied in Lithuania from 1 May 2016. • ethyl alcohol and alcoholic drinks, The simplified code aims at facilitat- including beer, wine and interme- ing trade, reducing compliance costs diate products; for business, and implementing elec- • processed tobacco, including tronic data processing techniques for cigarettes, cigars, cigarillos and all exchanges of information between smoking tobacco; business and customs authority. • energy products, including fuel, The Customs Authority operates an petrol, kerosene, gasoline, fuel oil, Integrated Customs Information Sys- coal, coke, lignite, natural gas and tem and provides electronic services electricity. based on one-stop-shop principle, i.e. the companies can provide and receive all relevant information related to import, export and transit procedures in one place. The Tax Information Centre is a one-stop-shop for all questions related to taxation.

Modern electronic declaration system (EDS) ensures 24/7 service availability to the tax payers and makes the payment of taxes easy and fast.

30 Business Guide Lithuania 2017 Useful links

Invest Lithuania – www.investlithuania.com Investors’ Forum – www.investorsforum.lt Confederation of Lithuanian Industrialists – www.lpk.lt Lithuanian Business Confederation – www.lvk.lt Association of Lithuanian ICT Industry “Infobalt” – www.infobalt.lt Engineering Industries Association of Lithuania – www.linpra.lt Association of Lithuanian Chambers of Commerce, Industry and Crafts – www.chambers.lt Enterprise Lithuania – www.verslilietuva.lt Association of Lithuanian Banks – www.lba.lt Klaipėda Free Economic Zone – www.fez.lt Kaunas Free Economic Zone – www.ftz.lt Kėdainiai Free Economic Zone – www.kedainiulez.lt Marijampolė Free Economic Zone – www.balticfez.com Panevėžys Free Economic Zone – www.pfez.lt Sunrise Valley – www.sunrisevalley.lt Vilnius Tech Park – www.vilniustechpark.com Exhibition and Conference Management Lithuanian Exposition Center LITEXPO – www.litexpo.lt Ekspozicijų Centras – www.expo.lt Expo Vakarai – www.expo-vakarai.lt AIM Group Baltic – www.balticconference.com Transport and Communications Vilnius, Kaunas and Palanga Airports – www.ltou.lt Lithuanian Railways – www.litrail.lt Port of Klaipėda – www.portofklaipeda.lt Lithuanian National Road Carriers Association “Linava” – www.linava.lt State Institutions President of the Republic of Lithuania – www.president.lt Lithuanian Parliament – www.seimas.lt Government of the Republic of Lithuania – www.lrv.lt Lithuanian Tax Authority – www.vmi.lt Lithuanian Customs Authority – www.cust.lt Lithuanian Centre of Registers – www.registrucentras.lt Lithuanian Department of Statistics – www.stat.gov.lt Lithuanian Department of Migration – www.migracija.lt Lithuanian Labour Exchange Office – www.ldb.lt Lithuanian Courts – www.teismai.lt Lithuanian Competition Council – www.kt.gov.lt Lithuanian Central Bank – www.lb.lt Lithuanian Ministry of Foreign Affairs – www.urm.lt Largest Cities Vilnius – www.vilnius.lt Kaunas – www.kaunas.lt Klaipėda – www.klaipeda.lt Panevėžys – www.panevezys.lt Šiauliai – www.siauliai.lt

Business Guide Lithuania 2017 31 Deals We help clients do better deals and create value through mergers, acqui- PwC sitions, disposals and restructuring. We work together with them to help develop the right strategy before the PwC firms help organisations and Accounting deal, execute their deals seamlessly, individuals create the value they’re identify issues and points of nego- looking for. We’re a network of firms services tiation and value, and implement changes to deliver synergies and im- in 157 countries with more than We provide a full range of accounting provements after the deal. Our Deals 223,000 people who are committed services starting with booking of pri- professionals are able to discover and to delivering quality in assurance, tax mary documents and ending with the quantify hidden value in every aspect and advisory services. Tell us what preparation of financial statements of a deal. The services we provide matters to you and find out more by in accordance with local Business Ac- include financial due diligence (buy visiting us at www.pwc.com. counting Standards and/or Interna- side and sell side), tax due diligence, In Lithuania, the firm has been oper- tional Financial Reporting Standards. mergers and acquisitions, valua- ating since 1993 and currently em- Our Accounting services are of tion and strategy as well as business ploys more than 170 people. Its clients advantage for the newly established recovery services. include both multinational corpora- businesses and their branches as we tions and large local companies. assist them with the development of an efficient accounting system, Assurance services Tax services which complies with the require- Our audit and accounting advisory ments of both, the company and We advise on starting up a business in services comprise audits and review of Lithuanian legislation. Lithuania and assist foreign entities financial statements as well as advice with company registration, tax com- on accounting requirements. Our In- pliance, mergers and acquisitions and Advisory services ternal Audit team provides a range of internal audit services, including out- employment law issues. The Advisory practices in Lithuania, sourcing, co-sourcing and assessment Our Tax services include compre- Latvia, Estonia and Belarus are oper- of internal audit function. Our System hensive tax advice on all aspects of ating as one integrated practice. local and international taxation. and Process Assurance team performs reviews and assessments of key busi- Assignments include tax reviews, Consulting ness processes and controls, as well as tax planning services, preparation The services we provide include IT-related processes and controls with or advice on transfer pricing docu- performance improvement, finan- special focus on cyber security ser- mentation, representation at tax cial management, IT risk manage- vices. We also offer financial reporting disputes, tax due diligence and all ment, internal audit, risk assessment advisory services, including solutions aspects of tax compliance. and management. Our advisers for improvement of financial report- can assess the potential of a busi- ing and consolidation. Legal services ness undertaking and help achieve long-term results in cost reduction, Law firm PricewaterhouseCoopers revenue maximisation, improve- Legal Bukauskas ir Partneriai is a part PwC’s Academy ment of key business processes and of PwC Legal, a global network of PwC’s Academy can help your busi- internal control mechanisms. IT risk Legal Services. The PwC Legal net- ness develop the future leaders assessment and management solu- work has the broadest geographical that you need to succeed in today’s tions are designed to help companies coverage of any Legal Services net- marketplace. Your business and your optimise controls and management work in Central and Eastern Europe. people are able to benefit from our of IT resources, as well as select and PwC Legal offers integrated legal knowledge and experience. PwC’s implement IT systems. advice alongside with other PwC ser- Academy delivers various trainings vices. Please visit www.pwclegal.lt for on: International Financial Reporting more information about PwC Legal. Standards, Lithuanian GAAP, Internal Audit, ACCA and ACCA DipIFR, Man- agement Accounting and other.

More than 223,000 people across the PwC network

More than 170 people in PwC Lithuania

32 Business Guide Lithuania 2017 Contacts

PricewaterhouseCoopers UAB J. Jasinskio g. 16B LT-03163 Vilnius, Lithuania Phone +370 5 239 2300 Fax +370 5 239 2301 Rimvydas Jogėla [email protected] Managing Partner www.pwc.com/lt Assurance Leader Phone +370 5 239 2311 PwC Legal [email protected] J. Jasinskio g. 16B LT-03163 Vilnius, Lithuania Phone + 370 5 239 2300 Fax +370 5 239 2301 [email protected] www.pwclegal.lt Audrius Cesiulis Advisory Leader Phone +370 5 239 2305 [email protected]

Nerijus Nedzinskas Partner, Leader of Tax, Legal and Accounting Services Phone +370 5 239 2350 [email protected]

Rokas Bukauskas Leader of PwC Legal Phone +370 5 239 2341 [email protected]

Giedrė Cater Accounting Services Leader Phone +370 5 254 6934 [email protected] www.pwc.lt