[ESTABLISHING A BUSINESS ENTITY IN LITHUANIA] 325
• Reduced corporate income tax rate will be increased from 6 % to 7 %. Tax relief for newly registered companies: Companies will not have to pay income tax for the first two years if: • Annual income does not exceed EUR 300,000; • The owners of the company are individuals; • During the first 3 years, the entity’s activities are not suspended, and the entity’s shares are not transferred; • The requirement regarding the number of employees has been abolished. Instant depreciation: Companies can deduct the purchase price of certain groups of fixed assets (e.g., equipment, computer hardware, software, trucks up to 5 years old) from their income as soon as the assets are put into use. However, such assets must be used in the company's operations for at least 3 years (with certain exceptions). Otherwise, income tax will have to be recalculated retrospectively using the usual depreciation rates. Tax Losses: • From 2026, tax losses between companies in a group of entities may only be transferred if the group companies have belonged to that group without interruption for at least two years prior to the last day of the tax period for which the tax losses are being transferred. • Both losses accumulated by the company itself and those taken over during reorganization or from other group companies are subject to the same
restriction, according to which the amount of tax losses deducted may not exceed 70% of the company's income for the tax period. Large project relief (legal entities do not pay income tax for 20 tax periods): • Applicable if large project investment agreements are concluded by 31 December 2035; • The investment amount has been increased from EUR 100 million to EU 110 million.
ILN Corporate Group – Establishing a Business Entity Series
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