Transfer pricing in Latvia

Transfer pricing in Latvia at a glance

Regulation Type OECD
Are there specific transfer pricing regulations? Yes
Submission deadline N/A
Submission deadline upon request 30 days
Annual update required No
Official language requirements Latvian
Potential impact of penalties N/A


Latvian tax law

Rules for transfer pricing in Latvia are based upon:

  • Income Tax Act article 12
  • Taxes and Duties Act articles 15.2, 16.1, 23.2


Rules for transfer pricing in Latvia generally follow the OECD Transfer Pricing Guidelines.


Accepted methods

Accepted methods are:

  • the comparable uncontrolled price method
  • the resale price method
  • the cost plus method
  • the profit split method
  • the transactional net margin method

Priority of methods

Rules for transfer pricing in Latvia do not prescribe a most appropriate method rule. However, the traditional transcation methods are preferred over the transactional profit methods.

Documentation requirements

Information that should be included in the documentation: 

  • General overview of the industry;
  • Organizational and legal structure of the taxpayer and related company, including description of internal relations;
  • Information regarding business strategy of the taxpayer;
  • Information identifying operations between related companies;
  • Description of the goods or services in the transaction between the taxpayer and related person;
  • Terms and conditions of the agreement concluded between the taxpayer and related person;
  • Forecast of the operating activities of taxpayer in relation to the agreement concluded with related company;
  • Description of the selected transfer pricing method;
  • Financial analysis of comparable unrelated companies or analysis of price (cost) applied to comparable transactions between unrelated companies and its compliance with the market price (cost), and
  • Other documents supporting the price (cost) applied to transactions between the taxpayer and related person.


  • Latvian

Requirements to prepare documentation annually

There is no requirement to prepare the transfer pricing documentation annually.

Submission deadline upon request by tax authorities

Upon request, documentation should be submitted within 30 days after a request has been made.

Advance Pricing Agreements


Rules for transfer pricing in Latvia provide for Advance Pricing Agreement (APA) regulations since January 2013.


APA’s are agreed upon for a period of three years.


Rules for transfer pricing in Latvia do no provide for specific transfer pricing penalties, meaning that ordinary penalties apply.