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Latvia has 23.59% employer VSAOI, three-bracket income tax (20%/23%/31%), EUR 700/month minimum wage, and a growing Riga IT and fintech hub. Rippling EOR handles VID, VSAA, and Latvian Labour Law compliance.
Latvia is a Baltic EU member state with a growing IT outsourcing, fintech, and shared services sector centered in Riga. Latvia offers EU membership, a multilingual workforce (Latvian, Russian, English), and competitive salaries relative to Western Europe. EOR is popular for technology and professional services companies entering Latvia. Latvia joined the Eurozone in 2014.
Setting up a Latvian SIA requires UR registration and VID employer registration. EOR is recommended for 1–10 employees or where the combined VSAOI and IIN monthly declaration (due by 17th) is a complexity. Latvia's multilingual workforce and IT sector make it attractive for international employers seeking Baltic EU access.
VSAOI employee: 10.5% on gross salary. IIN income tax: 20% (up to EUR 20,004/year); 23% (EUR 20,005–78,100); 31% (above EUR 78,100). NTM (non-taxable minimum) reduces taxable base for lower earners.
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VSAOI employer: 23.59% on gross salary (covers pension, disability, maternity, unemployment, work accident). Business risk duty: EUR 0.36/month per employee. Total employer on-cost approximately 23.6% of gross.
IIN: 20% (up to EUR 20,004/year); 23% (EUR 20,005–78,100); 31% (above EUR 78,100). NTM applies for lower earners. Monthly remittance to VID by 17th of following month combined with VSAOI.
Annual leave: 20 working days minimum. Sick leave: days 1–3 unpaid; days 4–10 employer-paid at 75%; VSAA from day 11 at 80%. Maternity: 56 days pre + 56 days post at 80% via VSAA. Paternity: 10 days at 80%. Public holidays: 15 days.
Notice: 10 days (probation); 1 month (general). Severance: 1 month (up to 5 years); 2 months (5–10 years); 3 months (10+ years). NVA notification for collective redundancies. Rippling EOR manages full termination process.
EU/EEA nationals: free right to work. Non-EU nationals: work permit required. Processing: 2–4 weeks. Rippling EOR supports applications through its Latvian entity.
Statutory: VSAOI employer 23.59%, 20 working days annual leave, maternity 112 days at 80% via VSAA, sick pay (employer days 4–10 at 75%; VSAA from day 11 at 80%). Market standard: private health insurance, meal allowance, transport allowance, remote work equipment. Riga is the primary tech hub.
Rippling EOR Latvia operates through a local Latvian entity. Key Latvia-specific handling: VSAOI employer contributions (23.59%), combined VSAOI and IIN monthly declaration to VID by 17th, NTM application for lower earners, and Labour Law severance calculations on termination.
Latvia's VSAOI (Valsts sociālās apdrošināšanas obligatās iemaksas) is the state social insurance contribution system. Employer rate: 23.59% on gross salary. Employee rate: 10.5%. Combined total: 34.09%. VSAOI covers pension, disability, maternity, unemployment, and work accident insurance. Both rates have no ceiling for most branches. Rippling EOR remits employer VSAOI monthly to VID by the 17th.
Latvia's income tax (IIN) uses three brackets: 20% (up to EUR 20,004/year); 23% (EUR 20,005–78,100); 31% (above EUR 78,100). A non-taxable minimum (NTM) reduces the taxable base for lower earners. Employer withholds IIN monthly and remits to VID by the 17th of the following month, combined with VSAOI in a single declaration.
Latvia's minimum wage is EUR 700/month (2024), rising to EUR 740/month in 2025. Latvia has been increasing its minimum wage as part of EU convergence. Rippling EOR monitors annual minimum wage updates and ensures all employees are paid at or above the current rate.
Notice: 10 calendar days (probation); 1 month (general). Severance: 1 month (up to 5 years); 2 months (5–10 years); 3 months (10+ years). NVA (State Employment Agency) notification required for collective redundancies. Additional VSAA-funded severance benefit paid directly to employee by VSAA.
