The Republic of LATVIA Cabinet of Ministers Regulations No. 248 (pr. No 42 10) «the law on corporate income tax application rules ' Issued in accordance with the law «On taxes and duties Article 5 1. "these rules determine the law «on corporate income tax» (hereinafter-the «law») (Latvian journal, 1995, 32) the specific arrangements for the application of the rules of certain taxpayers in specific cases.
2. Article 1 of the law of the third subparagraph of paragraph 1, the application of the parent and subsidiary definitions specified in the law «about the company» (the annual reports of the Republic of Latvia Supreme Council and Government Informant, 1992, 44; Latvian journal, 1995, 34).
3. the degree of Kinship and affinity in law is determined in accordance with the first paragraph of Section «family law» chapter III «kinship and affinity».
4. Article 2 of the law in the first part of paragraph 3, to be followed in the application of 28 March 1995, the law on amendments to the law «About «foreign investments»» in the Republic of Latvia (Latvian journal, 1995, 47) the fourth part of article 2 and of the law «On taxes and charges» (Latvian journal, 1995, 26) article 14.
5. in determining whether a foreign company's permanent representation in Latvia is tax deductible, in addition to the provisions referred to in paragraph 4, the laws must also comply with existing tax conventions.
If a tax treaty provides for different terms than the law in force at the Convention.
Sometimes the Convention restricts the right of taxing the permanent representation of the profits. The provisions of the Convention to a certain extent narrows the definition of permanent representation, for example, individual tax conventions construction site will be treated as a permanent establishment only if it lasts for construction in more than six months.
6. Article 2 of the Act, the fourth subparagraph shall apply in accordance with the law «about the company» annual reports article 1, second subparagraph.
Farmers and fishermen and individual companies of the holding shall submit an annual report, not if their annual income from financial transactions not exceeding 45 000 lats at the beginning of the year (that is, pirmstaksācij a year). Exceeding this amount, the farmers and fishermen of the holding and to the individual companies become corporate tax payers and pay the tax for five years, including the year in which they are established (registered) on corporate income tax payers. This five-year period in accordance with the law «on corporate income tax» article 4 fifth peasant and fishing farms and individual companies — that taxpayers — must submit to the company's annual report. If the final year of the farmer or fisherman, or individual holding company annual revenue from economic transactions are less than 45 000 lats, then next year the company must register as an individual income tax payer.
7. Article 3 of the law of the third subparagraph may be applied only if the foreign company is a subsidiary of the company or permanent establishment (determined in accordance with the law «on taxes and fees» article 14 sixth and relevant tax conventions in force rules). But also in this case is whether a non-resident transaction in Latvia are treated as its permanent representation in accordance with the relevant provisions of the Tax Convention.
Example.
Foreign company (non-resident) use the natural person resident of Latvia — — on its sales agent in Latvia. That person is empowered to enter into contracts on behalf of a foreign company, which it regularly uses. So the foreign company has permanent representation in Latvia. Permanent representation in 1995 profit is 100 000 lats, taxable income: 80 000 LVL, tax at the rate of 25 percent is 20 000 lats. in 1995 the foreign company directly (not through the permanent representation) have been sold to consumers in Latvia for 800 000 lats in total the same goods which are sold through the permanent representation of Latvia. So the permanent representation in that income liable to corporate income tax, will be $80,000 + $800 000 = $880 000. In this case, the 220 000 lats for the tax.
Note that in practice, including permanent representation in the non-resident's taxable income earned income directly (example-800 000 lats), must report expenses related to be included in income.
8. Article 3 of the law referred to in the fourth paragraph of the payments at specified rates tax payable by non-residents, but only the withholding tax and resident contributions budget. The tax to be deducted and paid to the budget of those companies who are not corporate income tax or use the facilities in accordance with the law «on foreign investments in the Republic of Latvia "(the Republic of Latvia Supreme Council and the Government of the rapporteur, 1991, 46; 1993, 10; Latvian journal, 1994, 75; 1995, 47). Article 3 of the law part four should apply if the non-resident receives revenue in Latvia, not through the permanent representation of Latvia. Depending on whether or not the non-resident has a permanent establishment in Latvia, the same charges can be taxing in different ways.
Examples.
1. the BELC is a company, (B) a resident of the State. It provides consulting and management services company, which is the LATC resident. Advice is provided to the country B which regularly arrives at the LATC. The pay of BELC LATC services 100 000 dollars a year.
In this case the BELC not permanent representation in Latvia, but the received payment for BELC services in Latvia can be taxing in accordance with article 3 of the law of the fourth part of the provisions of paragraph 2, after the 10 percent rate.
2. the BELC is a company, (B) a resident of the State. It provides consulting and management services company, which is the LATC resident. Advice is provided in Latvia that regularly attend the BELC specialists who teach the LATC in leading employees. The charge of BELC LATC services 100 000 dollars a year.

In this case, the analyze of BELC action according to the law «on taxes and fees» article 14 the sixth part, which States that if the non-resident «provides services, including consultancy, management and technical services through foreign company's employees or associated personnel», it is considered that the non-resident (example-BELC) has permanent representation in Latvia. So in this case, you must determine the representation of taxable income in accordance with the law «on corporate income tax» and the Cabinet of Ministers of 18 April 1995 regulations No 106 «rules on the permanent representation of the non-resident taxable income determination» (Latvian journal, 1995.63) and applied a 25 percent rate.
9. in applying article 3 of the law of the fourth part, must comply with existing tax conventions, in particular, in determining whether a non-resident has a permanent representation of Latvia or not, because, on this basis, it will be the responsibility of the non-resident tax in accordance with article 3 of the law, the second and third or fourth part of article 3.
10. in applying article 3 of the law of the fourth part, paragraph 4 on the computer programs are exempt royalties pursuant to the fourth paragraph of article 3 paragraph 4 (application of five interest rate).
11. Article 3 of the law of the fourth part 6 and 7 and article 4 of the sixth part of the relevant Cabinet of Ministers rules do not apply.
12. Article 4 of the law in the first paragraph, provides that, in determining the taxpayer's taxable income, the amount for profit is increased or reduced by the amount of losses it spending (or part of) an amount that is not directly connected with the economic activity of the taxable person and the amount of damages, which are created by a person belonging to the social infrastructure maintenance. Moreover, it should be noted that these expenses (loss) should contain the relevant taxable profit and loss account items of expenditure.
13. in accordance with article 4 of the law the second part, in determining the taxable income of permanent missions must respect the law, the Cabinet of Ministers of 18 April 1995 the Regulation No 106 «rules on the permanent representation of the non-resident taxable income determination», and the Cabinet of Ministers of 31 March 1995, in Regulation No 69 «rules on duty-free or low taxation countries and areas "(Latvian journal, 1995, 51).
14. the main characteristics of permanent representation is that permanent representation is non-residents (foreign company) and not a separate company. Establishing permanent representation in taxable income, no account shall be taken of the income and expenses incurred in carrying out various types of payments (income or expenditure when deploying) between different non-residents (foreign company) components, in particular between the foreign company's regular pārstavniecīb in Latvia and the rest of the company (excluding foreign firms: banking-permanent representation of Latvia).
15. The Permanent Mission should be borne by individual non-residents (foreign company) expenses to the extent they are applicable to the non-resident's permanent representation of Latvia (used by the permanent representation of the business needs). This means that, in determining the taxable income of the permanent representation, should be allowed to cut down on certain foreign business (non-resident) total expenditure, however, such a reduction is allowed only if the expenditure concerned is really related to the permanent representation of Latvia conducted business. In this case, the permanent representation of the part of the related expenditure is determined in proportion to the permanent missions of the revenue ratio of foreign business (non-resident) (see total revenue. The Cabinet of Ministers of 18 April 1995, Regulation No 106 «rules on the permanent representation of the non-resident taxable income determination»). However, these reductions may not be made, determining the Cabinet approved duty free and low taxation countries (see the list. The Cabinet of Ministers of 31 March 1995, Regulation No 69 «rules on duty-free or low-tax countries and zones») that residents of countries and territories for the permanent representation of the taxable income. Note that the Cabinet of Ministers of 18 April 1995 the Regulation No 106 «rules on the permanent representation of the non-resident taxable income determination» impose no obligation to permit the application of the reductions referred to in any case. It may be permitted if the taxpayer proves that tasks really are associated with the business carried out in Latvia and earned income.
16. If it is allowed to reduce the taxable income, the amount of the reduction is to be considered as payments to non-residents and withholding tax shall be in accordance with the law «on corporate income tax "(see. The Cabinet of Ministers of 18 April 1995 the Regulation No 106 «rules on the permanent representation of the non-resident taxable income determination», 5, 6, 7 and 8).
17. in accordance with the Cabinet of Ministers of 18 April 1995 the Regulation No 106 «rules on the permanent representation of the non-resident taxable income determination» of the non-resident's taxable income of permanent representation should be fixed «as it is established, if the permanent establishment were a separate enterprise that.. works independently from the non-resident». In cases where the non-resident supplies (pass) in the permanent representation of the goods for resale in Latvia, this application allows you to reduce the taxable income of the permanent representation of the amount of goods delivered pay a separate company that operates completely independently of the non-resident purchases goods and on market prices. (On market pricing, see paragraph 41 of the regulations.)
Example.
SWEC is a State resident, then Z is a permanent representation in Latvia. SWEC supplied permanent representation for television sets, including their purchase price — 180 lats for each. The mission implement them for 200 lats each. Permanent establishment shall submit a tax that taxable income is $200-$ 180 set = $20, of which tax is five dollars. Revenue Service has information that the same tv, independent wholesalers distributes par140 lats for each. Based on this information, revenue service adjusts tax calculation and submitted on expenditure recognised only 140 dollars, so the taxable income is $200-$ 140 = $60 and duty — 15 Lats.

18. Article 5 of the law provided for in the first subparagraph, the taxable accounts must be presented for all expenditures, including those who are not related to the business. For example, if your organization receives a gift purchased on the company's resources, then these gifts should be added to the employee's salary and be deducted both personal income and social tax according to the relevant statutory requirements. If this is not done, the payer may apply the sanctions for concealing taxable income. To expenditure which is not related to the economic activity of the taxable person, such costs should be added to the business owner and employee entertainment and benefits that cannot be distributed to the staff.
19. The minimum cost of staff in accordance with the laws or regulations of the Cabinet of Ministers is a cost item and may not be treated as expenses that are not related to the economic activity of the taxable person.
20. the taxable income is to be increased by the amounts of expenditure related to the safety rules (for example, expenditure on special working clothes workman, the so-called specpien and for medical examination needed for a specific job duties) according to the norms in force in accordance with the Council of Ministers of 14 august 1992, decision No. 337 «the standard technical regulations and the application of rules» (the Republic of Latvia Supreme Council and the Government of the rapporteur , 1992, 44) or other provisions of the Cabinet of Ministers or, in certain cases matched with the State revenue service.
21. Application of law article 6, first paragraph, point 1, the company's financial accounting must be made in the fixed assets and intangible investments, depreciation and write-offs that reflect the fixed assets and intangible investments in physical, moral or other kind of value the real loss and display the company's true profit or loss. Any fixed asset in your business financial accounting can create different depreciation accounting method, however, change this method for an individual asset cannot be otherwise, as specified in the law on accounting.
22. fixed asset depreciation and amortization of intangible investment procedure, which is laid down in article 13 of the law, intended only for taxation purposes. If the organisation or higher, for example, the State Statistics Committee, the company requires to submit quarterly balance sheet, it is a financial accounting of the balance that must be used to draw up the depreciation accounting system and norms or odds, which may not be the same as laid down in article 13 of the law.
23. Since the company's financial earnings statement as one of the items of expenditure also includes the actual fixed asset depreciation, as well as in accordance with the law «about the company» annual reports publications subscribed intangible investments, taxable income must be increased by these amounts and must be reduced by an amount calculated in accordance with article 13 of the law. If the taxable person concerning the use of the social infrastructure of the payment shall be charged to users, these social infrastructure objects are related to the economic activity of the taxable person and the determination of the tax depreciation should be calculated.
24. Of the law article 6, first paragraph, point 3 of the said State and local companies need to consider State and municipal companies, as well as national and/or local government corporations.
25. Enterprises regardless of their form of ownership are required to take all reasonable measures to recover the lost iztrūkumo and izlaupījumo values: the underlying should immediately notify the authorities of the investigation and criminal prosecution or formal refusal to propose. If such measures have not been taken in determining taxable income, profit increase of the loss amount.
If the payer has taken measures and will iztrūkumo or izlaupījumo incurred losses are written off in the accounts of the company, but these amounts are recovered, then, in determining taxable income, it may not be reduced by the sums recovered.
26. The application of the law, the first paragraph of article 6, paragraph 4, of the company's taxable income on the amounts raised by way of costs that, only if the company of the non-resident is not after a tax in the amount set in accordance with article 24 of the Act. Tax on the amount by applying a tax rate of 25 percent must be paid even if the company is exempt from corporate income chapter or use the facilities in accordance with the law «on foreign investments in the Republic of Latvia ".
27. Article 6 of the law on the third part of the said loan interest payments (regardless of the loan repayment period) is one of the items of expenditure the financial accounting. Determining taxable income, corporate profits should rise only on the interest payment the amount of which is included in the cost of long-term investments in accordance with the law «about the company» annual accounts article 26.
28. Article 6 of the law of the fourth part contains national and municipal dues paying financial accounting is shown as cost items. The law does not require an adjustment for taxable income of these amounts.
29. Article 6 of the law on the fifth part provides that the calculation of the tax, not be taken into account in the balance sheet items revaluation of assets.
Gains and losses resulting from foreign currency rate changes, are taken into account and credited to the total of the taxpayer's profit or loss according to the records of the relevant operation.
30. Article 6 of the law, sixth paragraph, applicable to any type of insurance payment of insurance premiums, pursuant to article 6 of the seventh part of these conditions.
31. Article 6 of the law on the seventh part contained the provisions in relation to article 6 of the sixth part is the special nature of the rules. In accordance with the two types of insurance insurance premium payment, the employee life insurance premiums and retirement payment of insurance premiums, the exclusion from income, which is taxable, the law provides for the restriction. For these two types of insurance insurance premiums payments taxable income may be reduced only if the insurance contract is concluded for a period of not less than five years.

32. in accordance with article 6, the sixth and the seventh part of the income that is taxable, you can exclude any type of insurance the insurance premium payment in accordance with the law «on insurance» (the Republic of Latvia Supreme Council and Government Informant, 1993, 3; Latvian journal, 1994, 11; in 1995, 4), except for life insurance premiums, and the level of insurance premium payments if the insurance contract on these two types of insurance is concluded for a period of less than five years.
33. Whereas financial accounting of taxpayer expense items shall include all insurance premiums, then, in determining taxable income, profit increase for life and retirement insurance premiums, concluded for a period of less than five years.
34. If the payer has entered into your employees ' lives or supplementary pension insurance contract is for more than five years, but, for example, after three years of breaking the contract, then the relevant taxation period, in the taxpayer's taxable income must be increased by the amount of all insurance premiums, which are paid for this contract.
35. If a person is insured and the contract has expired, but the policyholder is timed and the person gets back part of insurance premiums (bonus), then this part of the insurance premium tax period concerned paying the financial accounting will be counted as income and will be included in taxable income.
36. in applying article 6 of the law's eighth annual average equity is defined as the amount of one twelfth of the sum comprised half of the company's equity at the beginning of the year the amount (balance sheet), half of the company's equity at the end of the year amount (balance sheet) and the company's equity amount each month (except January) the first date.
Example.
If the company's average annual amount is the equity 2000 lats, of any other company or foreign banks have borrowed for three years 10 000 lats for 25 percent a year, but the State Committee on statistics in a specific short-term credits average annual rate of 20 percent, then the company as interest payments can produce only 400 lats (2000X0, 20 = 400). Therefore, taxable income must be increased by 2100 lats (2,500-400 = 2100). Starting with the next year after year, in accordance with the loan agreement, the company has paid all the required interest payment amount, it still can produce interest 400 lats (rule — the average amount of equity and short-term credits average annual rate credit remains the same, if this amount is changed, then 400 lats will be another figure) and by this amount to reduce annual taxable income Although actually the company following the interest payment shall be made. The following taxable income may be reduced each year until the total amount of the reduction will be equal to the annual interest payment in excess of the permissible amount of a loan for the duration of the contract (in this example, the number of years can be calculated as follows: 2100X3:400 = 16).
One would assume that in the fifth year after the payment of interest on the loan of 50 percent of the company's shares changed owners. So the company five years reduced the taxable income of 400 lats each year and could continue another 11 years. Starting from the sixth year, the taxable income of such business will no longer be.
If the company is in the third year after the payment of the interest on the loan (and the sixth year of the payment of interest on the loan at the beginning of the year) is privatized, then in the year of privatization as the interest payments it can produce 5100 lats (2500X3 — 400X6 = 5100) and consequently reduce taxable income. Future taxable income for any interest payments that are associated with the loan, may not be reduced.
37. for the purposes of article 9 of the law, paying for a financial profit plus lost debt amounts are listed as paying expenses except debt amounts lost, which may be subject to all the conditions referred to in this article.
38. If law article 10 referred to in the second paragraph of the compensation for the natural disaster or otherwise forcibly lost fixed assets (for example, in accordance with the law in the public interest for the remuneration forfeited land) paying financial accounting is counted as income, the taxable income is to be reduced by the amount of the compensation, taking into account the depreciation calculation according to article 13 of the law.
39. Article 10 of the law on the application of the fourth part explains the following example: if lost, the carrying amount of fixed assets in financial accounting is 300 dollars, the amount of compensation, but in the newly purchased 250 dollars, the value of the fixed asset, the newly purchased 350 lats – fixed asset book value, to be used in the calculation of depreciation in accordance with article 13 of the law (so the value that will be added to the value of that particular category), will be 400 dollars (300 + (350-250) = 400). The financial accounting of such operations does not reflect.
40. Article 11 of the law include the principle that dividends that the company has received from another company for the part of the capital invested, with the tax exempt.
In accordance with the law «about the company» 39 of the annual accounts of the parent company annual accounts the profit and loss statement shall be presented to the subsidiary's profit or loss. If the subsidiary's profit is subject to corporate income tax, then the parent company may not be to tax again on the same profits.
If the parent company's profit and loss account is shown in the subsidiary's losses, but the company is a subsidiary of the taxable person, then, in determining the taxable income of the parent company, its profits increased by a subsidiary of the loss amount.
41. in order to determine the law article 12 of part two, 2, 3, and 4. the goods referred to in paragraph (products, services) market price or value of the transaction, the transaction may apply to the Commission for evaluation (see. The Cabinet of Ministers of 28 March 1995, Regulation No 67 «rules on transaction Evaluation Commission»-Latvian journal, 1995, 13) or apply the following methods: 41.1. the comparable uncontrolled price method, which is applied to the price of the transactions between the company and the related company permanent representation) are compared: 41.1.1. with internal prices (prices for similar transactions between the company and its related companies);

41.1.2. with external prices (prices for similar transactions between other unrelated companies, as well as model or values, for example, customs value).
If these prices differ, then determining the goods (products, services), must be applied to the prices as would be applied to transactions between unrelated companies. Determining taxable income, appropriate adjustments should be made. If similar transactions are not big differences in the price comparison can be used when it is possible to exclude factors which affect the transaction has occurred;
41.2. the resale price method: a method based on the price at which the goods (products) that were acquired from a related company, is sold on to independent customers. This price must be reduced by the amount of the seller's expenses related to goods (products) sales to independent customers and profit. The remaining amount is to be regarded as the price applicable to transactions between independent companies (market price) and comparable with the price actually charged transactions between related companies;
41.3. subtracting the cost method based on production (services) the supplier's cost of production (services) delivery to the related company. These costs are added to the appropriate profit margin and you get the price that is applied when the transaction occurred between two unrelated companies.
The appropriate profit margin shall be determined on the basis of the profit margin which the same production (services) the supplier receives transactions with unrelated companies. Can be based also on the profit margin, any other company in similar transactions with unrelated companies.
42. the company's profit is not to be adjusted, if the enterprise-resident of Latvia (permanent representation of a non-resident)-sold to the related company (the company's rest) goods (products, services) at prices that are higher than the market price, or the purchase of goods (products, services) at prices lower than the market price.
43. Article 12 of the law part four applicable in accordance with the Cabinet of Ministers of 31 March 1995, regulations No 69 «rules on duty-free or low taxation countries and areas».
44. Article 13 of the law in the first part of paragraph 2 must be carried out only in a specific accounting asset depreciation calculations in accordance with that article. The law does not set fixed asset accounting financial accounting.
45. Asset depreciation in accordance with article 13 of the law the first parts 1, 2, 3 and 4, the following clear examples: tax period the unit's book value at the beginning of the tax period or purchase the created assets capital cost or revenue obtained for excluded assets net book value, from the taxation period depreciation (3. + 4.-+ 5.6) rate (double) taxation period depreciation (7 × 8.)
Residual value after depreciation deduction of the tax period (beginning the next tax period) (7.-9.)
1 2 3 4 5 6 7 8 9 10 1995 $5380 2490 460 3520 4810 40% 1924 2886 PCs.
2886 x $25 13 18 20 20 1996.
20 entries in the table are obtained as follows: 45.1. in column 3 for 1995 in accordance with the law, the transitional provisions of paragraph 4, the amount of the category of fixed assets balance balance value of January 1, 1995. For subsequent periods of taxation records are taken from the records of the box 10 pirmstaksācij period;
45.2. the amount in box 4 on all the categories concerned asset acquisition or creation (the value at which the asset is placed in service) values that the relevant taxation period has purchased or put into service and used in economic activities. These data are taken from the financial accounting;
45.3. the amount in box 5 of all taxation period capital costs that apply to specific categories of fixed assets. These data are taken from the financial accounting;
28.2.6. column sums all the revenue or the values obtained for the taxation period excluded in the category of fixed assets. Note that a value based on the assets off the selling price or consideration for the natural disaster or otherwise forcibly lost fixed assets or salvage value after received (scrap, parts, and the like), or zero, if the asset is simply written off and gets nothing out of it. These data are taken from the financial accounting;
28.3. the amount in column 7 of the table entries according to the following formula: 3 + 4 + 5.-6. column type;
45.6.9. column sums the records in a table using the following formula: 7 X 8. the entries in this column;
28.4. the amount in column 10 of table entries according to the following formula: 7.-9. column entries.
46. Article 13 of the law of the first subparagraph of paragraph 5, the following clear examples: 1 2 3 4 5 6 7 8 9 10 1995 $5380 460 6930-1090 — — 0 PCs.
25 19 6 6 1996 Ls 0 PCs.
6 in this case about 1090 lats increase taxable income (without entering the financial accounting), but the category balance sheet (net book value, after deducting annual depreciation in money terms) equates to zero.
47. The law article 13, first paragraph, point 6, the following clear examples: 1 2 3 4 5 6 7 8 9 10 1995 $5380 2490 460 8255 75 40% 30 45 PCs.
25 13 18 20 20 1996 Ls 0 PCs.
20 If the category of the asset value of the remaining after deduction of depreciation at the end of the tax period does not exceed 50 pounds, respectively (in this case about 45 lats) to reduce the taxable income (without entering the financial accounting), but the remaining value in terms of money coming in at the beginning of the tax period equates to zero.
1 2 3 4 5 6 7 8 9 10 1995 $5380 3490 460 8300 1030 40% 412 618 PCs.
$25 13 38 0 0 1996 0 PCs.
0 If the end of the tax period in a given category does not have any asset, the taxable income reduced by 618 lats (without entering the financial accounting), the remaining value in monetary terms the next taxation period equates to zero and any records in the appropriate category of fixed assets starts from the beginning.
If for each category of fixed asset depreciation calculation is performed as in the above examples, the fixed asset tax period the total amount of the depreciation, which reduces taxable income under article 6, first paragraph, point 1, the result of adding table column 9 of the amounts mentioned in all the class and adding the depreciation of intangible investment in accordance with article 13 of the law.

Note the. In these rules the specified table is just an example, not an approved form of calculation or fixed asset accounts.
48. Under article 13, first paragraph, point 8 land, works of art, antiques, jewelry and other assets that are not subject to physical or moral depreciation (such as Museum or asset values, which then equate) depreciation is not calculated.
49. Article 13 of the law referred to in the second subparagraph, the capital costs for buildings and structures should follow the Latvian et seq (LBN), but in terms of technological equipment and machines for example machinery or equipment of significant parts (engine, power train and the like) replacement.
For kapitālaj costs are considered the cost of career, Marsh and other mineral deposits in the preparation of (atcelmošan, ditch excavation, installation, the surface of Earth nostumšan and the like).
The capital cost incurred in preparing for career and other mineral deposits, should be confined to buildings.
50. in accordance with article 13 of the law third, depreciate assets, net book value before taxation period depreciation may be multiply by the factor (average rate), for a financial accounting is increased or decreased value of fixed assets in the category concerned in the event of privatization.
51. In application of article 13 of the law third, intangible investment costs of setting up depreciation in accordance with article 6 of the law in the first part of paragraph 1 is one of the components of the depreciation deducted in the calculation only concessions, patents, licenses and trademarks obtained for payment.
52. the financial accounting of the payer account «concessions, patents, licenses, trademarks may be listed only "rights acquired for consideration. All these rights must be approved by an appropriate document showing this right received for payment.
For the same company in the research work received patents and licenses in that account to list may not, as their building costs have already listed the research costs. Such concessions, patents, licenses and trademarks are not intangible assets.
53. the concessions considered legislation that State for payment transfers or foreign individuals of Latvia or company (the company), as well as other State or public institutions (concessionaire) a public measure for a certain time and under certain conditions, which may provide for arrangements for the distribution of income between the State and the concessionaire, the order in which the State controls the operation of the concessionaire, as well as the rules of operation of the concessionaire.
54. The concession may be issued or mine water resource utilization, industrial operations and the like.
The concession is issued for a certain period of time and with the rules laid down in the Treaty, determining the order in which income to be distributed between the State and the concessionaire. The concession may be issued also in the law or intergovernmental arrangement, while required by contract.
55. After the expiry of the concession all property that was passed to the contract the concessionaire, as well as other property, if so specified in the concession contract, again taking over the country.
56. the concession tax laws is not the meaning of the lease purchase (the object of privatization may not be a concession contract) or lease without redemption, rental agreement or other agreement, which does not include the dealership signs.
57. On intangible investment costs to be considered a concession to the Latvian laws allowed payments directly related to the acquisition of concessions. If the concession rights acquisition for the concessionaire undertakes to transfer to the State share of future profits, the profit tax law meaning not considered intangible investment costs to obtain concessions.
58. If the concession is granted for a period which is shorter than ten years, but patents, licenses or trademarks, for a period that is shorter than five years, the value of the term in writing (in the tax period) to which the concession is issued, patent, license or trade mark.
59. The application of article 17 of the law, first paragraph, point 3, the average number of employees shall be established in accordance with the law «about the company» annual reports article 24.
60. Article 18 of the law in the fourth paragraph that agricultural activity includes the production of plants for planting of forests as one of the sectors of crop production. Inland waters fisheries are fisheries, which deals with the person to use it holds or cast in the ground (fish ponds).
61. Article 20 of the law on the application of the first paragraph of a certain Cabinet of 31 March 1995, by Regulation No 70 «rules about the order in which public organizations (funds) and the budgetary authority is granted or revoked permission to receive donations, donors receive a corporate tax incentives» (Latvian journal, 1995, 51).
62. The application of article 22 of the law, the first paragraph must comply with the Cabinet of Ministers of 18 April 1995, the provisions of no. 104 «rules on corporate income tax returns "(Latvian journal, 1995, 63).
63. Article 22 of the law referred to in the third subparagraph of the retail price index changes considered by the National Statistical Committee's average consumer price index by month during the period.
64. Article 22 of the law on the meaning of the fifth part of the agricultural enterprises and companies are companies engaged in agricultural activities.
65. in order to determine the quarterly tax payments to the agricultural enterprises and companies of the unprocessed agricultural products, those up next quarter's first twenty-fifth day of the month must be submitted to the accounting balance and the tax return for the period from the beginning of the year, but up to 25 January of pēctaksācij, annual report and tax returns for the entire tax year.
66. the agricultural enterprises and companies tax for a given reference period, from the beginning of the year is calculated as the difference between the calculated tax amount for the current period and previous reporting periods for tax iemaksātaj and amounts of advance payments.

Calculating the tax for the reporting period from the beginning of the year, in accordance with article 13 of the law of fixed asset depreciation calculation shall be applied accordingly, quarter, half, or three quarters of the depreciation rates doubled. Full double rate asset depreciation is applied for drawing up the tax return for the taxation year.
In calculating the tax credit, in accordance with article 18 of the Act for the reporting period from the beginning of the year, you can apply a quarter concerned, or three fourth parts of the full discount. The full tax credit, in accordance with article 18 of the law can be applied when drawing up tax returns for a full tax year.
Tax rebates under article 16 and 20 are applied, creating tax returns for a full tax year.
67. Article 23 of the law, first paragraph, point 3 of the retail price index is considered to be the National Statistical Committee defined the common pirmstaksācij of the year the consumer price index.
68. Under article 23, first paragraph, point 2, the calculation of advance payments for the rest of the year, the month of pirmstaksācij should be taken into account in the annual consumer price index, calculated and up to the fifth day of each month, notify the State revenue service.
69. The application of article 24 of the law, the first paragraph, it should be noted that, in accordance with article 3 of the law of the fourth paragraph of point 6 and 7 tax will be deducted from income from the sales of securities in Latvia and Latvia in real estate sales. In determining the amount to be deducted from the tax is authorized to deduct certain expenses of the Cabinet of Ministers.
70. The Act of the transitional provisions for the application of section 7 a specific Cabinet of 18 April 1995 the Regulation No 101 «rules of procedure is deleted or reduced payments for losses incurred in 1992» (Latvian journal, 63).
71. in accordance with the law, the transitional provisions of paragraph 10, submitted a tax return for 1995 's first half, the depreciation calculation according to article 13 of the law for each asset category, apply half of double depreciation rates.
72. Tax rebates under the Act, 16, 19 and 20 article are applied, creating tax returns for a full tax year.
73. when submitting tax returns for 1995 's first half, a person can reduce taxable income for losses the company has incurred up to 31 December 1994 and calculated in accordance with the law «On profit tax» article 22 (the Republic of Latvia Supreme Council and Government Informant, 1992, 27), if these losses are recorded in the 1994 profit tax calculation (report).
Prime Minister m. cock Finance Minister i. SĀMĪT 1995 in Riga on august 8.