Free tools · 2026 rates
Dividend and corporate income tax calculator 2026
From 2026 a company (SIA) can choose: standard corporate income tax (CIT) of 20% (dividends to individuals are not further taxed) or the alternative regime — CIT of 15% with a 6% personal income tax withholding. The calculator shows both side by side.
In Latvia corporate income tax is paid only when profit is distributed — reinvested profit is not taxed. The comparison shows how much of the money the company spends reaches the owner in each regime.
Best regime
Standard CIT 20 %
The owner receives 8000,00 €
Difference between regimes
10,00 €
For the same money spent by the company the difference is small — the conditions decide
Standard CIT 20 %
8000,00 €
the owner receives
- Company spends in total10 000,00 €
- Declared dividend8000,00 €
- CIT2000,00 €
- Income-tax withholding0,00 €
- Total taxes2000,00 € (20 %)
Dividends to individuals are not further taxed with personal income tax. Available to all — even if a member is a legal entity.
Alternative 15 % + 6 % income tax · New from 2026
7990,00 €
the owner receives
- Company spends in total10 000,00 €
- Declared dividend8500,00 €
- CIT1500,00 €
- Income-tax withholding510,00 €
- Total taxes2010,00 € (20,1 %)
Only if all members are individuals; the choice applies to all dividends of the tax period.
In both regimes the result per each €100 of profit is almost the same (€80.00 vs €79.90) — in practice the choice is set by the conditions: the alternative regime requires all members to be individuals and binds all of the year's dividends. Remember also the minimum corporate income tax of 50,00 € a year, if the company does not pay at least €100 of payroll taxes.
Frequently asked questions
How much tax is due on dividends in 2026?
Under the standard regime, corporate income tax is 20% of the gross distributable profit (dividend / 0.8 × 20% — effectively 25% of the amount paid out); there is no further personal income tax on dividends for individuals. From €100 of profit the owner receives €80.
What is the alternative CIT regime (15% + 6%)?
From 2026, a company (SIA) whose members are all individuals can apply corporate income tax of 15% to dividends (coefficient 0.85) while withholding 6% personal income tax. The choice applies to all dividends of the tax period. From €100 of profit the owner receives about €79.90 — almost the same as under the standard regime.
Is reinvested profit taxed with corporate income tax?
No — in Latvia corporate income tax is paid only when profit is distributed. As long as the profit stays in the company or is reinvested, there is no tax.
This calculator is for information only and does not replace tax advice — the final figure is set by the State Revenue Service (VID) in its assessment. The rates are computed by the same engine used in Vadi accounting, and each value is verified against official sources (VID, likumi.lv). If you spot an inaccuracy, write to us.
Vadi does these taxes for you
Salaries, VSAOI reports, MUN and VAT declarations in EDS format, a tax calendar with exact amounts — automatically, without spreadsheets and calculators.