A Single Tax Account Has Replaced Over 40 Tax Accounts in Latvia

Kristine Stendere's picture
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To reduce the administrative burden, payments administered by the State Revenue Service (SRS) can be made into a single tax account as of 1 January 2021.

Previously, payments were made to over 40 accounts. Now, all inland taxes administered by the SRS are paid in one account. Moreover, this can be done by filling in one payment order. This significantly reduces the possibility of depositing taxes to the wrong account and associated transfer costs. In addition, the payment deadline for all regular inland tax payments has been unified for the 23rd of each month.

When paying taxes into the single tax account, the amount is automatically divided according to types of taxes and directed to their payment. Use of the FIFO principle guarantees that both regular payments and debts are covered, covering outstanding liabilities first, so the taxpayer can no longer have a tax debt and a tax overpayment simultaneously.

To keep SRS clients informed about which taxes have been paid and what their future liabilities are, a new section “Payments and payment status” has been created in the SRS Electronic Declaration System (EDS): Any bookkeeper or company accountant can follow the distribution of the money paid and plan timely payment of taxes.

As of 1 January 2021, SRS has adopted the accrual principle in the accounting of state revenues. Consequently, taxpayers can receive correct and understandable information on tax payment status for any given date, making the tax payment process transparent, understandable and traceable.

In order to complete these large-scale changes, SRS is carrying out extensive modernisation of their information systems through the information and communication technology project “Modernisation of tax information services – MAIS core”, co-financed by ERAF. 

The procedure for payment of customs duties and related accounts has not changed. Payment of customs duties into the single account is scheduled for 2023.