COVID-19

 Published: 26.01.2021. 08.15


Support during COVID-19

  • Furlough support for companies and their employees
    • Entrepreneurs who experience a drop in revenue from 9 November 2020 to 30 June 2021, but not longer than the period during which imposed restrictions on economic activity are in force, can apply to SRS and receive furlough support for their employees who are not working.

      Who can receive furlough support?

      Any company whose operating income decreased by at least 20% compared to average income in August, September and October 2020 may apply for furlough support for its employees. 

      ! Please note: applications submitted after 15 March must prove that decreased revenue is a result of restrictions imposed on economic activity due to Covid-19.

      How much support can an employee receive?

      Employee – 70% of the average monthly gross salary from 1 August to 31 October 2020 (only if the employee was actually working). Furlough support will be not less than EUR 500 (in 2020 – EUR 330) and not more than EUR 1000 per month.

      Micro-enterprise employee – 50% of the average monthly gross salary for the 3rd quarter of 2020, but not less than EUR 500 (in 2020 – EUR 330) and not more than EUR 1000 per month.

      An employee who receives furlough support is granted a SSIA supplement of EUR 50 for each dependent child under the age of 24. You do not to apply to receive this supplement.

      If an employee works for several employers, furlough support may be be paid by each employer. However, the total amount received may not exceed EUR 1000 per month and the minimum benefit of EUR 500 applies only to one benefit payment per month. Support grants are decided in the order in which the employers have submitted the application. Subsequent benefits are calculated in proportion to salary and duration of furlough.

      If an employee returns to work from parental leave during the state of emergency, the allowance is set at 70% of the average parental benefit for August, September, and October 2020, but not less than EUR 500 (in 2020 – EUR 330) and not more than EUR 1000 per month.

      ! Please note - a person can receive support from several employers as well as support as a self-employed person, however, total State support cannot exceed EUR 1000 per month.

      Employers may pay their employees the difference between the furlough allowance and their full salary.

      How do I apply?

      The employer submits an application for his/her employees through EDS.

      • Furlough support is available until 30 June 2021, but not longer than the period during which imposed restrictions on economic activity are in force.
      • Furlough support can be applied for until the 15th day of the following month, e.g., 15 February for January and so on.
      • The employer must provide information about the company, reduced income, and furloughed employees. Employers must certify that the employee is capable of work and that the employee’s employment contract will not be terminated during the period for which the support is granted, as well as one month after.
      • The employer must provide information about the company, reduced income, and furloughed employees. Employers must certify that the employee is capable of work and that the employee’s employment contract will not be terminated during the period for which the support is granted, as well as one month after.
      • If support is granted, the SRS will transfer funds to the employee's account (in Latvia) within five business days and will inform the employer through EDS. The employer informs its employees about receiving the support.


      When is furlough support not granted?

      • If the employer has not submitted all tax returns and annual reports for the last 12 months before the emergency situation to SRS.
      • If the employer has been deregistered from the SRS VAT register in the last two years (except if the employer deregistered on his/her own initiative) or has suspended economic activity.
      • From 16 March, if the employer has not submitted proof that decreased income is a result of restricted economic activity due to Covid-19 or if the SRS has evaluated the employer's application and finds that the decrease in income is not related to imposed restrictions.
      • If the employer is currently involved in bankruptcy proceedings.
      • If requested for members of the employer's board of directors.
      • For days for which sick leave has been granted.
      • If the employer has sub-contracted staff to another business.
      • If the employer is a state or local government institution or a state or local government controlled business. If the employee was hired after 1 November 2020.
         

      ! Please note - when an employee is granted furlough support, he/she cannot apply for paid sick leave and municipal benefit payments.

  • Furlough support for part-time workers
    • Businesses that experience a drop in revenue during the emergency situation can apply to SRS for support for wage subsidies for their part-time employees. The employer is obliged to pay the employee the difference between the amount of support received and the amount of wages. Thus, part-time employees will be able to continue to receive the same pay as before the emergency.

      Who can receive wage subsidies?

      Any company whose operating income decreased by at least 20% compared to average income in August, September and October 2020 may apply for furlough support for its employees. If the company did not actually operated in any of these months and there was no revenue, this month should not be included in the calculation.

      How much support can an employee receive?

      • 50% of the average monthly gross salary from 1 August to 31 October 2020, but not more than EUR 500 per month.
      • The employer is obliged to pay its employees the difference between the subsidy and wages previously payed to the employees.


      How do I apply?

      • The employer must submit an application for its employees through EDS.
      • Wage subsidies can be applied for until the 15th day of the following month, i.e., until 15 January for December, 15 February for January, and so on. The employer must also submit a report on SSIA, PIT, and business risk state fee from the employee’s income, as well as the monthly VAT declaration if required.
      • The employer must provide information about the company, reduced income, and employees. Employers must certify that the employee is capable of work and that the employee’s employment contract will not be terminated during the period for which the support is granted, as well as one month after, and that if the subsidy is not granted, employment will terminated.
      • If support is granted, the SRS will transfer funds to the employee's account (in Latvia) within five business days and will inform the employer through EDS. The employer informs its employees about receiving the support.


      When are wage subsidies not granted?

      • If the employer has not submitted all tax returns and annual reports for the last 12 months before the emergency situation to SRS. (Exceptions to this condition apply to companies that are participants in the SRS Advanced Cooperation Program.)
      • If the employer is currently involved in insolvency proceedings.
      • If requested for members of the employer’s board of directors.
      • For days for which sick leave has been granted.
      • If the employer has sub-contracted staff to another business.
      • If the employer is a state or local government institution or a state or local government controlled business.
      • If the employee was hired after 1 November 2020.
  • Grant for working capital
    • A total of EUR 70.8 million has been allocated, and support can be applied for in November or December 2020.

      Who can apply?

      The aid is intended for companies that have experienced a drop in turnover of at least 20% in November or December compared to average turnover in August, September and October combined, and for whom turnover in November and December is at least 30% lower than for the corresponding months of 2019.

      New companies registered with the SRS after 1 January 2020 can apply for support if the criterion of a 20% drop in turnover is met, comparing the average turnover of August, September and October 2020.

      How much can I get?

      • 30% of the company's total gross salary for which salary taxes were paid in August, September and October 2020. The maximum support available to one company is EUR 50 000.
      • The maximum support available for a group of related parties is EUR 800 000. The maximum amount of aid available for a group of related parties involved in the processing and canning of fish, crustaceans and molluscs is EUR 120 000. If a business operates in more than one sector, one of which is the processing and canning of fish, crustaceans and molluscs, it shall separate these sectors in its accounting and ensure that the total aid received does not exceed the aid ceiling specified.
         

      Related parties are entities between which one of the following relationships exists:

      1. The company has a majority of the shareholders’ or members’ voting rights in another company.
      2. The enterprise has the right to appoint or remove a majority of the members of the administrative, management or supervisory body of another enterprise.
      3. The enterprise has the right to exercise a dominant influence over another enterprise under a contract entered into with that enterprise or under a clause in its articles of foundationan undertaking which is a shareholder in or member of another undertaking has sole control over a majority of the shareholders 'or members' voting rights in that undertaking in accordance with an agreement reached with the other shareholders in or members of the undertaking.
      4. The enterprise is a shareholder in or member of another enterprise that has sole control over a majority of the shareholders’ or members’ voting rights in that enterprise in accordance with an agreement reached with the other shareholders in or members of the enterprise.


      How do I apply for a grant?

      • Submit an application through EDS by 15 January 2021.
      • The application must be accompanied by a completed declaration regarding compliance as a small or medium-sized company.


      No aid is granted if:

      • The total tax debt exceeds EUR 1000, except if a payment extension has been granted or an agreement on voluntary payment of taxes has been entered into
      • The company has declared bankruptcy protection by 31 December 2019
      • Bankruptcy proceedings are taking place
      • The company has has received rescue aid and has not repaid the loan or withdrawn the guarantee, or it has received restructuring aid and is covered by a restructuring plan.
      • The company has been deregistered from the VAT payer register in the last 2 years or has suspended economic activity.
      • The company has paid less than EUR 200 euros average per month during the previous 6 months before the emergency situation.
      • The company or a member of its board has been punished in the previous year for tax, customs, or labour violations (if the fine for an individual violation exceeds EUR 151 and the total amount of fines exceeds EUR 500 for the year).
      • The company is affiliated with a public official (see the Law on Governance of Capital Shares of a Public Person and Capital Companies)
      • Primary production is agricultural products
      • The company is a credit or financial institutions


      If aid is unlawfully received, the company is obliged to repay the aid received, with interest.

  • Support for the self-employed
    • Self-employed persons registered with SRS, recipients of royalties who are not registered with SRS, and sole proprietors who experienced a decline in income from 9 November 2020 to 30 June 2021 (but not longer than the period during which imposed restrictions on economic activity are in force) may apply for furlough support.

      Do I qualify for furlough support?

      Furlough support may be requested if the revenue for the month for which support is requested has decreased by at least 20% compared to the average revenue in August, September and October 2020.

       !  Please note – applications submitted after 15 March must prove that decreased revenue is a result of restrictions imposed on economic activity due to Covid-19.

      How much support can I receive?

      • 70% of the average income or royalties in the 3rd quarter of 2020, but not less than EUR 500 (in 2020 – EUR 330) and not more than EUR 1000 per month. Calculation of royalties may not include income received from collective societies.
      • Micro-enterprises - 50% of the average monthly income for the 3rd quarter of 2020, but not less than EUR 500 (in 2020 – EUR 330) and not more than EUR 1000 per month.
      • Persons who receive this support are granted a SSIA supplement of EUR 50 for each dependent child under the age of 24 for which personal income tax deductions are applied.


      ! Please note - a person can receive support from several employers as well as support as a self-employed person, however, total State support cannot exceed EUR 1000 per month.

      How do I apply?

      • Submit an application through EDS.
      • Furlough support is available until 30 June 2021, but not longer than the period during which imposed restrictions on economic activity are in force.
      • Support can be applied for until the 15th day of the following month, e.g., until 15 February for January and so on.
      • You must provide information about your business, certify that you are capable of working, and prove that the volume of economic activity has decreased by over 20%.
      • If support is granted, SRS will transfer funds to your account (in Latvia) within five business days and will notify you through EDS.
         

      No aid is granted if:

      • Your total tax debt exceeds EUR 1000, except if a payment extension has been granted or an agreement on voluntary payment of taxes has been entered into
      • You have declared bankruptcy
      • From 16 March, you have not submitted proof that decreased income is a result of restricted economic activity due to Covid-19 or if the SRS has evaluated your application and find that the decrease in income is not related to imposed restrictions
      • You are on sick leave (those days are not included)
      • You receive support from the State Cultural Capital Fund programmes
      • You have not submitted all tax declarations for the last year before the emergency situation
      • Your economic activity started after 1 November 2020


      Sick leave and municipal benefits are not paid if you receive furlough support.

  • Support for patent payers
    • Recepients of patent fees who experienced a decline in income from 9 November 2020 to 30 June 2021 (but not longer than the period during which imposed restrictions on economic activity are in force) may apply for furlough support.

      Can I receive furlough support?

      Furlough support may be requested if revenue for the month for which support is requested has decreased by at least 20% compared to the average revenue in August, September, and October 2020. If in any of these months you have not actually received income, that month is not included in the calculation of average income.

       !  Please note: applications submitted after 15 March must prove that decreased revenue is a result of restrictions imposed on economic activity due to Covid-19.

      How much support can I receive?

      • EUR 500 (in 2020 – EUR 400) for a full month if the patent is valid during the support period or if the patent has been valid for at least 6 months before the declaration of the emergency
      • An SSIA supplement of EUR 50 for each dependent child under the age of 24. You do not to apply to receive this supplement.
      • There is no patent fee or reduced patent fee during the support period.
      • If a patent fee or reduced patent fee was paid in 2020 for 3 or 6 months or for one year within the period for which the emergency situation has been declared, the period of application of the patent fee or reduced patent fee shall be extended for the duration of the support period.


      ! Please note - you can receive support from several employers as well as self-employed support and patent fees, but in any case, total State support cannot exceed EUR 1000 per month.

      How do I apply?

      • Submit an application through EDS.
      • Furlough support is available until 30 June 2021, but not longer than the period during which imposed restrictions on economic activity are in force.
      • Support can be applied for until the 15th day of the following month, e.g., until 15 February for January and so on.
      • You must provide information about your business, certify that you are capable of working, and prove that the volume of economic activity has decreased by over 20%.
      • If support is granted, SRS will transfer funds to your account (in Latvia) within five business days and will notify you through EDS.

      No aid is granted:

      • For the days you receive sick leave benefits
      • From 16 March if you have not submitted proof that decreased income is a result of restricted economic activity due to Covid-19 or if the SRS has evaluated your application and find that the decrease in income is not related to imposed restrictions.
  • Support for hair and beauty industry
    • Employees, self-employed* and patent payers in the salon industry may apply to the SRS for furlough compensation from 1 January 2021 until the end of the ban on providing hair and beauty services.

      *Registered with the SRS

      Who can apply?

      • Persons who were employed by an employer (legal entity or self-employed person) who provided beauty services in October, November or December 2020
      • Self-employed persons who provided beauty care services in October, November or December 2020
      • Patent payers who provided beauty services in August, September, October, November or December 2020
      • Support staff who were employed by a legal entity or a self-employed person during this period
         

       !  Please note – The service provider must be registered with the Health Inspectorate.

      Proof of economic activity is determined by SRS and Health Inspectorate data. The applicant does not have to submit additional information.

       !  Please note – The application cannot be submitted by an employer.
       

      What are considered hair and beauty services?

      Support is available to people who provide the following services: hairdressing, manicure, pedicure, massage, cosmetology, solarium, tattooing, scarification, micro-pigmentation, piercing, public sauna or public swimming pool.

      How much support a person can receive?

      • Employee: 70% of the declared average monthly gross salary from 1 August to 31 October 2020, but not less than EUR 500 or more than EUR 1000 per month.
      • Self-employed: 70% of the average income in the 3rd quarter of 2020, but not less than EUR 500 or more than EUR 1000 per month.
      • Micro-enterprise: 50% of the declared average monthly gross salary for the 3rd quarter of 2020, but not less than EUR 500 or more than EUR 1000 per month.
      • Self-employed person registered as a micro-enterprise: 50% of the declared average monthly gross salary for the 3rd quarter of 2020, but not less than EUR 500 or more than EUR 1000 per month.
      • Patent fee payer with a valid patent in August, September, October, November or December 2020: EUR 500 per month.
      • Returnees to work from parental leave in January or any month during the ban on salon services: 70% of the average parental benefit for August, September and October 2020, but not less than EUR 500 or more than EUR 1000 per month.
      • Persons who receive furlough support are granted a SSIA supplement of EUR 50 for each dependent child under the age of 24. No application has to be made to receive this payment.
      • If a person has several forms of employment (e.g., employee, self-employed, several employers), it is possible to receive furlough support for each. Support is granted in the order in which the application was submitted. The minimum monthly benefit of EUR 500 applies only to one benefit payment per month. Each subsequent benefit is calculated in proportion to the salary and the duration of furlough. The total amount may not exceed EUR 1000 per month.


      ! Please note – If a person’s tax status changes in 2021, furlough support will be determined according to the tax payment regime in place on 31 December 2020.

      How to apply

      • Submit an application through EDS.
      • Furlough support is available as of 1 January 2021 for the duration of the restriction of hair and beauty services.
      • Furlough support can be applied for until the 15th day of the following month, e.g., 15 February for January and so on.
      • Indicate full name, personal identification code, period for which furlough support is requested, and Latvian account number.
      • If support is granted, the SRS will transfer funds to the employee's account (in Latvia) within five business days and will inform the employee through EDS. SRS will also notify the employer about support payments.

       

      No support is granted if:

      • The employer, self-employed person, or patent payer has not registered with the Health Inspectorate
      • The self-employed person was not registered as a performer of economic activity in October, November or December 2020
      • The patent payer did not have a valid patent in August, September, October, November or December 2020
      • The beneficiary does not have an account in a credit institution or payment service provider in Latvia
      • The maximum amount of aid has been paid out
  • Tax payment extensions
      • You may request to divide or defer tax payments for a period of up to three years from the date of submission of the application.
      • You may also request an extension for overdue tax payments, the payment term of which has already been extended in accordance with the Law on Taxes and Duties if the delay is a result of COVID-19.
      • No late payment fees are calculated for overdue tax payments for which an extension has been granted, and information about the company will not be included in the SRS tax debtor database.
      • For detailed information on COVID-related reductions of income, see Regulations Regarding the Employers Affected by the Crisis Caused by COVID-19 which are Eligible for the Allowance for Idle Time and Division of the Payment for Late Tax Payments in Instalments or Deferral Thereof for up to Three Years (https://likumi.lv/ta/en/en/id/313514).
  • In-depth cooperation programme
    • If a participant of the In-depth Cooperation Programme can provide evidence of negative effects due to the COVID-19 crisis, the SRS shall take this into account in any decision made in 2020, 2021, 2022, and 2023.

      When is support for Programme participants provided?

      Support is provided for:

      • Deadlines for submission of reports and declarations;
      • Reduced tax revenue;
      • Reduced average monthly earnings of employees; and
      • Amount accrued as a result of a tax audit exceeds 3% of the tax revenue for the year.
         

      When assessing compliance with the criteria and identifying participants who do not meet the criteria, companies will be contacted through EDS. Evidence provided must be sufficient and fact-based to prove existence of objective circumstances that prevented the company from meeting the specific criteria of the program.

      Support will not available if the following criteria are not met:

      • Amount of penalties for administrative violations does not exceed EUR 151: total amount per year is EUR 500;
      • Not convicted of a criminal offence;
      • Not currently involved in insolvency, legal protection, or out-of-court legal protection processes;
      • Economic activity has not been terminated or suspended, liquidation process has not been initiated;
      • Company officials are not prohibited from holding positions;
      • Taxpayer or affiliated service department has not violated the regulation on use or maintenance of cash registers, hybrid cash registers, cash register systems, or specialised devices or equipment;
      • Exclusion from the VAT register has not begun;
      • Reachable at the registered legal address;
      • Taxes are paid; and
      • Company officials or members are not on the “risky” person list.