Latvia Compliance Report

Regulatory Overview

Regulatory Status

Some rules exist but significant gaps; draft legislation or limited guidance

Primary Legislation

[object Object], [object Object]

Travel Rule

Not adopted

Tax Reporting

**Taxable Event:** The moment a virtual asset is sold, exchanged for fiat currency, exchanged for another virtual asset, or used to acquire goods or services.. **Tax Rate:** **20%** on the positive difference between the selling price (or fair market value at the time of exchange/use) and the acquisition cost.. **Basis:** The acquisition cost includes the price paid for the crypto asset and any directly related expenses (e.g., transaction fees).. **Losses:** Capital losses from the sale of virtual assets can generally be offset against capital gains from other capital assets (including other virtual assets) within the same taxation year. They cannot be carried forward to future years or offset against other types of income.. **Exemption Threshold:** There may be an annual threshold for declaring capital gains (e.g., if total capital gains are below a certain amount, declaration might not be mandatory, but actual tax liability still arises if gains are made). Currently, if total annual capital gains from all sources do not exceed EUR 1,000, a separate capital gains declaration might not be required, but the gain is still taxable and must be reported in the annual income tax return.

Key Facts

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