Benefits for patrons

The law provides tax relief for patrons (Article 12), which may be applied for a taxpayers donating to an organization of public benefit. The taxpayer may choose one of the following options:

1. To exclude the amount of donation from the taxable base of the taxation period, not exceeding 5% of the previous year's profit after tax;
2. To exclude the amount of donation from corporate taxable base of the taxation period, not exceeding 2% of the total gross wage earned by employees from the previous reference year, from which state social insurance payments have been paid;
3. To reduce the corporate income tax calculated from dividends of the reference year by 75% of the donated amount, not exceeding 20% of the corporate income tax of the dividends.

The limit in points 1, 2 or 3 applies to the total amount of donations made during the reference year.  

The tax relief for individuals provided under point 3 of the first paragraph of Article 10 of the Law on Personal Income Tax stipulate that the following payer's expenses are deducted from the amount of taxable income: amout which have been transferred in the form of a donation or gift to registered societies, foundations and religious organizations or their institutions of Republic of Latvia that have been granted a status of public benefit organization under the Public Benefit Organizations Law.