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LEGAL ACTS OF THE REPUBLIC OF LATVIA
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The translation of this document is outdated.
Translation validity: 01.01.2017.–31.12.2017.
Amendments not included: 27.07.2017., 22.11.2017.
Text consolidated by Valsts valodas centrs (State Language Centre) with amending laws of:

10 June 1998 [shall come into force from 14 July 1998];
25 November 1999 [shall come into force from 1 January 2001];
13 March 2001 (Constitutional Court judgment) [shall come into force from 13 March 2001];
20 June 2001 [shall come into force from 20 July 2001];
27 July 2001 [shall come into force from 17 August 2001];
6 June 2002 [shall come into force from 5 July 2002];
3 April 2003 [shall come into force from 1 May 2003];
22 January 2004 [shall come into force from 25 February 2004];
17 March 2005 [shall come into force from 1 April 2005];
27 October 2005 [shall come into force from 25 November 2005];
15 June 2006[shall come into force from 1 October 2006];
19 December 2006 [shall come into force from 1 January 2007];
26 April 2007 [shall come into force from 30 May 2007];
8 November 2007 [shall come into force from 1 January 2008];
19 June 2008 [shall come into force from 23 July 2008];
11 December 2008 [shall come into force from 1 January 2009];
16 June 2009 [shall come into force from 1 July 2009];
1 December 2009 [shall come into force from 1 January 2010];
3 December 2009 [shall come into force from 1 January 2010];
27 May 2010 [shall come into force from 1 September 2010];
9 August 2010 [shall come into force from 1 September 2010];
20 December 2010 [shall come into force from 1 January 2011];
8 July 2011 [shall come into force from 1 October 2011];
15 December 2011 [shall come into force from 1 January 2012];
20 December 2012 [shall come into force from 10 January 2013];
6 November 2013 [shall come into force from 1 January 2014];
13 March 2014 [shall come into force from 1 June 2014];
17 December 2014 [shall come into force from 1 January 2015];
12 March 2015 [shall come into force from 8 April 2015];
30 November 2015 [shall come into force from 1 January 2016];
22 September 2016 [shall come into force from 25 October 2016];
23 November 2016 [shall come into force from 1 January 2017];
20 December 2016 [shall come into force from 1 January 2017].

If a whole or part of a section has been amended, the date of the amending law appears in square brackets at the end of the section. If a whole section, paragraph or clause has been deleted, the date of the deletion appears in square brackets beside the deleted section, paragraph or clause.

The Saeima1 has adopted and
the President has proclaimed the following law:

On State Social Insurance

Chapter I
General Provisions

Section 1. Terms Used in this Law

The following terms are used in this Law:

1) employer - a legal or natural person, partnership with legal capacity, a taxpayer of other European Union Member State, Swiss Confederation or European Economic Area Member State (hereinafter - other Member State) or a branch of a merchant (permanent representation) of other Member State or a lessee of personnel who uses the services of such micro-enterprise that provides labour force ensuring services within the meaning of Section 17.2 of the Law On Personal Income Tax, as well as a domestic taxpayer - a lessee of personnel leased by a foreign taxpayer who employs an employee or pays for the work of an employee;

2) employee:

a) a person who, on the basis of a contract of employment for an agreed work remuneration, performs specific work under the management of an employer, except an employee of a micro-enterprise,

b) [27 October 2005],

c) a member of the Saeima, a local government councillor, a member of the Cabinet, a member of the board of directors, council of a commercial company, head clerk, controller, a volunteer probation officer of the State Probation Service, as well as another person holding a position which gives the right to remuneration, if the remuneration has been actually determined,

d) a person who has entered into a work-performance contract, a sharecropping contract or a carriage contract provided for in Part IV, Chapter 15 of the Civil Law and has not registered as an economic activity income tax payer,

e) an official of an institution of the Ministry of the Interior system and Prisons Administration with a special service rank, or a military person of a unit subordinate to the Ministry of Defence,

f) a State civil servant,

g) an authorised representative of a foreign merchant, who not being in employment legal relationships with such merchant, represents those activities, which are associated with the branches of the foreign merchant,

h) a convicted person who is employed during serving the sentence of deprivation of liberty,

i) an employee of a micro-enterprise,

j) a person who is employed by a foreign taxpayer in the Republic of Latvia which has a permanent representation in the Republic of Latvia, as well as a person who is leased to a domestic taxpayer by a foreign taxpayer - a lessee of personnel,

k) a person who has entered into contracts for work-performance, sharecropping contracts or carriage contracts provided for in Part Four, Chapter 15 of the Civil Law and in respect of which at least one of the features determined in Section 8, Paragraph 2.2 of the Law On Personal Income Tax has been determined,

l) an employee of micro-enterprise that provides labour force ensuring services within the meaning of Section 17.2 of the Law On Personal Income Tax;

m) a board member of a capital company if the turnover of the capital company in the current month of the taxation year exceeds the minimum monthly wage stipulated by the Cabinet multiplied by the coefficient 5 and in the relevant month the capital company does not have any employees or the object of mandatory contributions of all employees is less than the monthly wage stipulated by the Cabinet;

n) a person who within the meaning of the Law On Personal Income Tax is employed in seasonal agricultural work and pays the seasonal agricultural worker income tax;

o) a person who after the termination of the legal employment relationship has an agreement regarding the restriction of the occupational activity of the employee (restriction on competition);

p) a person who is engaged in carriage of passengers by a taxi for reward;

r) a person to whom according to the Law On Aid for the Activities of Start-up Companies State aid for paying taxes is applied;

3) self-employed person - a person who earns income (or revenue) as:

a) a person that performs individual work,

b) [25 November 1999],

c) a person whose permanent place of residence is in the Republic of Latvia and who receives a royalty (copyright or neighbouring rights remuneration), except an heir to copyright and a successor in interest to other copyright,

d) a sworn notary,

e) a sworn advocate,

f) a sworn auditor,

g) a doctor in practice, a pharmacist in practice, a veterinary practitioner, an optometrist in practice,

h) another natural person whose permanent place of residence is in the Republic of Latvia and who has registered as an economic activity income tax payer,

i) an owner (owners) of a farm (fishing undertaking) who, not being in employment legal relations with an administrative authority of his or her farm (fishing undertaking), performs the management function of such a farm (fishing undertaking) if, in accordance with the procedures laid down in law, a manager (director) has not been appointed (elected) in such a farm (fishing undertaking),

j) a person whose permanent place of residence is in the Republic of Latvia and whose work is remunerated from foreign technical assistance resources and loans from international financial institutions granted to the Republic of Latvia,

k) a sworn bailiff,

l) an individual merchant,

4) a domestic employee at a foreign employer shall:

a) a person who is employed by an employer - a foreign tax payer in the territory of the Republic of Latvia if the permanent place of residence of such person is in the Republic of Latvia,

b) a person who is employed by an employer from another Member State and to whom in accordance with Articles 11, 12, 13, 14, 15 and 16 of Regulation (EC) No 883/2004 of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems (hereinafter - Regulation), laws and regulations of the Republic of Latvia are applicable;

5) foreign employee at a foreign employer - a person who is employed by the employer - a foreign tax payer in the territory of the Republic of Latvia if the permanent place of residence of such person is not in the Republic of Latvia and he or she stays for 183 days or more in the Republic of Latvia in any 12-month time period which begins or ends in a taxation year.

[10 June 1998; 25 November 1999; 20 June 2001; 6 June 2002; 3 April 2003; 22 January 2004; 17 March 2005; 27 October 2005; 15 June 2006; 19 June 2008; 11 December 2008; 16 June 2009; 27 May 2010; 9 August 2010; 20 December 2010; 15 December 2011; 6 November 2013; 13 March 2014; 17 December 2014; 22 September 2016; 23 November 2016]

Section 2. Purpose of the Law

This Law prescribes the general principles of State social insurance (hereinafter - social insurance), as well as regulates the financial and organisational structure thereof.

Section 3. Concept and General Principles of Social Insurance

(1) Social insurance is a set of measures organised by the State in order to insure the risk of a person or dependants thereof to loss of income for work in connection with sickness, disability, maternity, unemployment, old-age, an accident at work or the contraction of an occupational disease, nursing of a child of the socially insured person, as well as additional expenditures in connection with the death of the socially insured person or dependants thereof. Social insurance is a part of the State social security system.

(2) The guiding principles of the social insurance shall provide for:

1) solidarity between social insurance contribution payers (hereinafter - payers) and recipients of social insurance services (hereinafter - recipients of services);

2) utilisation of social insurance funds only for social insurance services in accordance with the Law.

[10 June 1998; 25 November 1999; 8 November 2007; 16 June 2009 / Amendments to Paragraph one in relation to substitution of the words "the contraction of an occupational disease, as well as additional expenditures in connection with nursing of a child and" with the words "the contraction of an occupational disease, nursing of a child, as well as additional expenditures in connection with" shall come into force from 3 May 2010. See Transitional Provisions]

Section 4. Types of social insurance

Types of social insurance are as follows:

1) State pension insurance (hereinafter - pension insurance);

2) social insurance in case of unemployment (hereinafter - unemployment insurance);

3) social insurance in respect of accidents at work and occupational diseases (hereinafter - occupational accident insurance);

4) disability insurance;

5) maternity and sickness insurance;

6) parents' insurance.

[8 November 2007]

Chapter II
Persons to be Socially Insured

[10 June 1998]

Section 5. Persons to be Socially Insured

(1) All employees who have reached 15 years of age employed by an employer - a domestic tax payer, the tax payer of another Member State or a branch of a merchant (permanent representation) of another Member State, persons taking care of a child who has not reached one and a half years of age and receiving allowance for childcare or a parental benefit, persons receiving an unemployment benefit, persons with disabilities who are not registered as employees or have no mandatory social insurance as self-employed persons, persons receiving a disabled child care benefit, persons receiving a maternity, paternity or sickness benefit, persons receiving an allowance for the care of an adopted child, persons whose spouse (who has been granted a diplomatic rank in accordance with the Diplomatic and Consular Service Law) performs diplomatic and consular service in a foreign state and who stay in the relevant foreign state as a spouse of a person performing diplomatic and consular service, persons who are located in the relevant foreign state in the status of a spouse of a soldier performing service duties, except in cases where the soldier participates in an international operation, military training, manoeuvres or is on mission, persons performing temporary paid social work, and self-employed persons shall be subject to mandatory social insurance.

(2) All domestic employees who have reached 15 years of age employed at a foreign employer and foreign employees at a foreign employer shall be subject to mandatory social insurance.

(3) Persons who have reached 15 years of age, whose permanent place of residence is in the Republic of Latvia and who are not subject to mandatory social insurance in the Republic of Latvia, may join the State social insurance voluntarily in accordance with the procedures stipulated by the Cabinet. A person who has not been granted a State old-age pension in accordance with the Law On State Pensions may join voluntarily the pension insurance and a spouse of a self-employed person who has not reached the age giving the right to receive the State old-age pension or whom the State old-age pension has not been granted (including before term) may join the pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance voluntarily.

(31) In accordance with the procedures provided for by the Cabinet, persons who pay the income tax of seasonal agricultural workers may join pension insurance voluntarily.

(32) [20 December 2016]

(4) A person is socially insured for occupational accident insurance, insurance against unemployment, disability insurance, maternity and sickness insurance and parents' insurance, and he or she must make mandatory contributions (regarding thereof) from the day when such person has acquired the status referred to in Paragraph one of this Section, except the status of a self-employed person. A person shall be socially insured for pension insurance if mandatory contributions have been actually made.

(5) A self-employed person and the persons referred to in Paragraphs two and three of this Section are socially insured if social insurance contributions have actually been made.

(6) Employees of a micro-enterprise, except the employees referred to in Section 1, Clause 2, Sub-clause "l" of this Law, shall be socially insured in accordance with the Micro-enterprise Tax Law.

(7) The employees of a start-up company to whom State aid for tax payments is applied shall be subject to social insurance in accordance with the Law On Aid for the Activities of Start-up Companies.

[10 June 1998; 25 November 1999; 20 June 2001; 6 June 2002; 22 January 2004; 17 March 2005; 27 October 2005; 26 April 2007; 8 November 2007; 19 June 2008; 9 August 2010; 20 December 2010; 15 December 2011; 13 March 2014; 30 November 2015; 22 September 2016; 23 November 2016; 20 December 2016]

Section 6. Persons subject to Mandatory Social Insurance in Conformity with Their Employment, Age, State of Health and Type of Social Insurance

(1) Employees shall be socially insurable in conformity with all types of social insurance.

(2) Employees, who have reached the age that gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term) shall be subject to pension insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance. Employees who are recipients of a service pension or persons with disabilities - recipients of State special pensions - shall be subject to pension insurance, disability insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance.

(21) Employees, who are employed during serving the sentence of deprivation of liberty are subject to pension insurance, disability insurance and insurance against unemployment, but the persons, who have reached the age which gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term) and who are employed during serving the sentence of deprivation of liberty shall be subject to pension insurance.

(22) An employee paying the income tax of a seasonal agricultural worker whose total income from one or several disbursers of seasonal agricultural workers income (employers) exceeds 70.00 euros a month, shall be subject to pension insurance.

(23) A board member of a capital company whose status corresponds with that of an employee in accordance with the provisions of Section 1, Clause 2, Sub-clause "m" of this Law shall be subject to pension insurance and disability insurance but a board member of a capital company whose status corresponds with that of an employee in accordance with the provisions of Section 1, Clause 2, Sub-clause "m" of this Law and who has reached the age which gives him or her the right to receive the State old-age pension or who has been granted the State old-age pension (including before term) shall be subject to pension insurance.

(3) Self-employed persons whose income reaches the minimum amount of the object of mandatory contributions stipulated by the Cabinet shall be subject to pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance, but self-employed persons who have reached the age which gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term) shall be subject to pension insurance, maternity and sickness insurance, and parents' insurance.

(31) [22 September 2016]

(32) Natural persons which are performing economic activity and paying patent fee for it shall be subject to pension insurance and disability insurance, but the persons who have reached the age giving the right to receive State old-age pension or whom the State old-age pension has been granted (including before term) shall be subject to pension insurance.

(4) In addition to the persons referred to in Paragraphs one, two and three of this Section the following persons shall be subject to pension insurance:

1) [26 April 2007];

2) persons who take care of a child who has not reached one and a half years of age and receive an allowance for child care;

3) persons receiving an unemployment benefit;

4) persons with disabilities who are not registered as employees or who do not have mandatory social insurance as self-employed persons;

5) persons receiving a maternity, paternity or sickness benefit;

6) persons whose spouse (who has been granted a diplomatic rank in accordance with the Diplomatic and Consular Service Law) performs diplomatic and consular service in foreign states and who stay in the relevant foreign state as a spouse of the person performing diplomatic and consular service;

7) persons who receive an allowance for the care of an adopted child;

8) persons who are located in a relevant foreign state in the status of spouse of a soldier performing service duties, except the cases where the soldier participates in an international operation, military training, manoeuvres or is on official travel;

9) persons receiving a disabled child care benefit;

10) persons who take care of a child who has not reached the age of one year or one and a half years, and receive a parental benefit;

11) persons who are performing temporary paid social work.

(5) In addition to the persons referred to in Paragraph one of this Section the following persons shall be subject to unemployment insurance:

1) [26 April 2007];

2) persons who take care of a child who has not reached one and a half years of age and receive an allowance for child care;

3) persons receiving a maternity, paternity or sickness benefit;

4) persons who receive an allowance for the care of an adopted child;

5) persons who are located in a relevant foreign state in the status of spouse of a soldier performing service duties, except the cases where the soldier participates in an international operation, military training, manoeuvres or is on official travel;

6) persons who take care of a child who has not reached the age of one year or one and a half years, and receive a parental benefit;

7) persons whose spouse (who has been granted a diplomatic rank in accordance with the Diplomatic and Consular Service Law) performs diplomatic and consular service in foreign states and who stay in the relevant foreign state as a spouse of the person performing diplomatic and consular service.

(51) In addition to the persons referred to in Paragraphs one, two and three of this Section the following persons shall be subject to disability insurance:

1) persons who receive maternity or paternity benefit;

2) persons who take care of a child who has not reached the age of one year or one and a half years, and receive a parental benefit;

3) persons who take care of a child who has not reached one and a half years of age and receive an allowance for child care;

4) persons who receive an allowance for the care of an adopted child.

(6) Foreign employees at a foreign employer shall be subject to pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance.

(7) Owners of farms (fishing undertakings) who, not being in legal employment relations with an administrative authority of their farm (fishing undertaking), perform the management function of such a farm (fishing undertaking) if in accordance with the procedures provided for in the law a manager (director) has not been appointed (elected) for such a farm (fishing undertaking) and who have reached the age which gives them the right to receive the State old-age pension, or whom the State old-age pension has been granted (including before term) or who are persons with Group I or II disabilities shall not be subject to mandatory social insurance.

(8) Domestic employees at a foreign employer shall be subject to pension insurance, unemployment insurance, disability insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance.

(9) Domestic employees at a foreign employer who have reached the age which gives the right to receive the State old-age pension or to whom the State old-age pension has been granted (including before term) shall be subject to pension insurance, maternity and sickness insurance, parents' insurance and work accident insurance. Domestic employees of a foreign employer who are recipients of a service pension or persons with disabilities - recipients of State special pensions - shall be subject to pension insurance, disability insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance.

(10) Foreign employees at a foreign employer who have been sent to perform particular work in the territory of the Republic of Latvia for a time period not exceeding 12 months shall not be socially insurable persons if they submit to the State Revenue Service a document attesting to the making of mandatory contributions in the sending state. The document shall be submitted upon registration in the Taxpayer Register of the State Revenue Service.

(11) A natural person who performs the management function of his or her immovable property or acquires income from a private subsidiary farm or a backyard farm and has registered as an economic income tax payer and has reached the age which gives him or her the right to receive the State old-age pension, or whom the State old-age pension has been granted (including before term), or who is a person with Group I or II disability or whose permanent place of residence is not in the Republic of Latvia shall not be subject to mandatory social insurance.

(12) A natural person who performs the management of his or her immovable property and has registered as an economic activity income tax payer shall be subject to pension insurance and disability insurance.

(13) A natural person whose permanent place of residence is in the Republic of Latvia and who receives royalties (copyright and neighbouring rights remuneration), except for a heir to copyright and a successor in interest of other copyrights, and has reached the age which gives him or her the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term), or who is a person with Group I or II disability shall not be subject to mandatory social insurance.

(14) A person who is an employee and concurrently receives royalties (copyright and neighbouring rights remuneration) shall have the right to choose whether: not to make the social security mandatory contributions from the royalties (copyright and neighbouring rights remuneration) or to make the social security mandatory contributions from the royalties (copyright and neighbouring rights remuneration) in accordance with the rates and procedures prescribed for self-employed persons. A person may make such choice only once per report quarter until the term, which has been determined to a self-employed person for the settlement of mandatory contributions.

(15) A person who in acquiring one and the same income conforms to several statuses of a socially insurable person concurrently shall be subject to social insurance as an employee or a domestic employee at a foreign employer.

(16) A foreign employee at a foreign employer, who in acquiring one and the same income conforms to several statuses of the socially insurable person concurrently shall be subject to social insurance as a foreign employee at a foreign employer.

(17) An employer of another Member State may agree with a person to whom the laws and regulations of the Republic of Latvia are applied in accordance with Articles 11, 12, 13, 14, 15 and 16 of the Regulation as to the status of the person in which he or she will make mandatory contributions: in the status of an employee or in the status of a domestic employee of a foreign employer. In respect of such an agreement, the employer shall inform the State Revenue Service.

(18) A person, who is registered as an employee of a micro-enterprise and who concurrently complies with other statuses of a person to be socially insured, by acquiring one and the same income, he or she shall be subject to social insurance as an employee of a micro-enterprise.

(19) [20 December 2016]

(20) A person who after the termination of the legal employment relationship has an agreement regarding the restriction of the occupational activity of the employee (restriction on competition) shall be socially insurable for the whole period when the agreement is in force in accordance with Paragraph one or Paragraph two of this Section.

(21) A foreigner to whom the Regulation or an intergovernmental agreement on social security does not apply and who is employed within the framework of a project funded by the European Commission shall not be subject to mandatory social insurance within the framework of the abovementioned project.

[10 June 1998; 25 November 1999; 20 June 2001; 6 June 2002; 22 January 2004; 17 March 2005; 27 October 2005; 26 April 2007; 8 November 2007; 19 June 2008; 3 December 2009; 27 May 2010; 9 August 2010; 20 December 2010; 15 December 2011; 13 March 2014; 12 March 2015; 30 November 2015; 22 September 2016; 23 November 2016; 20 December 2016 / Paragraph 2.3 shall come into force on 1 January 2017. See Paragraph 57 of Transitional Provisions]

Chapter III
Social Insurance Funds and Procedures for Utilisation Thereof

Section 7. Social Insurance Special Budgets

(1) Social insurance contributions (hereinafter - contributions) shall be made and social insurance services shall be financed from the following special budgets:

1) State pension special budget;

2) employment special budget;

3) special budget for occupational accidents;

4) disability, maternity and sickness special budget.

(2) Special budgets shall be administered in accordance with the Law On Budget and Financial Management.

(3) A reserve may be established for each special budget in which reserve the excess income of a special budget over the amount of financing for the provided social insurance services shall be included.

(4) Each reserve of a special budget may be utilised in accordance with law.

[22 January 2004]

Section 8. State Pension Special Budget

(1) The State pension special budget shall consist of:

1) mandatory and voluntary contributions for pension insurance except for payments made in the State funded pension scheme;

2) dividends from capital shares transferred to the State pension special budget and revenue from the sale thereof;

3) other revenue.

(2) Social insurance services may be financed and expenses of a manager of such budget related to the administration of the budget may be covered from the State pension special budget only in accordance with the Law On State Pensions, except disability pension.

[20 June 2001; 3 April 2003]

Section 9. Employment Special Budget

(1) Funds of the employment special budget shall consist of mandatory contributions for insurance against unemployment and other revenues.

(2) Social insurance services may be financed and expenses of a manager of such budget related to the administration of the budget may be covered from the employment special budget only in accordance with the Law On Insurance in Case of Unemployment.

[6 June 2002]

Section 10. Special Budget for Occupational Accidents

(1) Funds of the occupation accident special budget shall consist of mandatory contributions for occupational accident insurance and other revenues.

(2) Social insurance services may be financed and expenses of a manager of such budget related to the administration of the budget may be covered from the special budget for occupational accidents only in accordance with the Law On Mandatory Social Insurance in Respect of Accidents at Work and Occupational Diseases.

Section 11. Disability, Maternity and Sickness Special Budget

(1) Funds of the disability, maternity and sickness special budget shall consist of mandatory contributions for disability insurance, maternity and sickness insurance, and parents' insurance and other revenues.

(2) Social insurance services may be financed only in accordance with the Law On Maternity and Sickness Insurance, as well as disability pensions and the expenses of a manager of such budget related to the administration of the budget may be covered from the disability, maternity and sickness special budget.

[3 April 2003; 8 November 2007]

Chapter IV
Insurance Contributions, Object of Insurance Contributions, Administration of Mandatory Contributions, Insurance Contribution Rates

Section 12. Insurance Contributions

(1) A mandatory insurance contribution is a mandatory payment laid down in law into the account of a special budget, which gives the right to a socially insured person to receive social insurance services laid down in law.

(2) A voluntary insurance contribution is a voluntary payment which is made by the persons referred to in Section 5, Paragraph three of this Law into the State pension special budget and to the disability, maternity and sickness special budget, and which gives the right to such persons to receive the State old-age pension, disability pension, maternity, sickness and parenting benefit in conformity with the amount of contributions made.

[25 November 1999; 20 June 2001; 8 November 2007]

Section 13. Registration of Persons and Employers Subject to Social Insurance

(1) Employers and self-employed persons shall be registered with the Taxpayer Register of the State Revenue Service in accordance with the procedures stipulated by the Cabinet.

(2) Each employee who has acquired, changed or lost the status of an employee laid down in Section 1, Clause 2 of this Law shall be registered by the employer with the State Revenue Service. Information regarding employees shall be provided by the employer within the term and according to the procedures stipulated by the Cabinet.

(21) The disburser of a seasonal agricultural workers income (employer) shall register each seasonal agricultural worker - income tax payer within the term and in accordance with the procedures laid down by the Cabinet submitting information about the employees to the State Revenue Service.

(3) Persons who joined pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance voluntarily shall be registered with the State Social Insurance Agency in accordance with the procedures stipulated by the Cabinet.

(4) Domestic employees of a foreign employer and foreign employees of a foreign employer shall be registered in the Taxpayer Register of the State Revenue Service in accordance with the procedures provided for by the Cabinet within 10 days from the day of acquiring the status.

(5) The State Revenue Service has the right to register losing the status of a socially insured person (employee). The procedures by which the State Revenue Service shall register losing the status of a socially insured person (employee) shall be determined by the Cabinet.

(6) The employee shall be registered as a socially insured person from the date indicated by the employer but not earlier than 60 days before the date on which the employer submitted information regarding the status of the employee. The Cabinet shall determine the cases in which an employee is registered as a socially insured person from the date indicated by the employer.

(7) The dates of acquiring and losing the status of an employee shall not be adjusted or updated.

[25 November 1999; 17 March 2005; 8 November 2007; 19 June 2008; 20 December 2012; 13 March 2014; 22 September 2016; 23 November 2016 / Paragraphs six and seven shall come into force on 1 July 2017. See Paragraph 62 of Transitional Provisions]

Section 14. Object of Mandatory Contributions

(1) The object of mandatory contributions of an employer and employee shall be all calculated income for work from which personal income tax must be deducted without deduction of the non-taxable minimum, tax concessions and eligible expenses for which the taxpayer has the right to reduce the taxable income.

(2) The object of mandatory contributions of a self-employed person shall be the freely selected income from the production of goods, performance of work, provision of services, creative and professional activity and other income from economic activity, except for the income that is obtained by a natural person, who has been referred to in Section 6, Paragraph seven, eleven or thirteen of this Law, from agricultural (fish) farming, his or her immovable property, self-produced production in an individual subsidiary farm or household farm, copyright and related rights. The Cabinet shall determine the minimum amount of the object of mandatory contributions and procedures for determination thereof.

(21) The State aid to agriculture or the European Union aid to agriculture and rural development and a non-recurring grant to unemployed persons for the implementation of a business plan shall not be included in the object of mandatory contributions of a self-employed person.

(3) The object of such mandatory contributions, which shall be made from the State basic budget and special budgets, shall be determined by the Cabinet.

(4) The object of mandatory contributions of a domestic employee at a foreign employer and a foreign employee at a foreign employer shall be the reimbursement received.

(5) The Cabinet shall determine the maximum amount of the object of mandatory contributions and procedures for the specification thereof.

(6) The Cabinet shall determine the object of voluntary insurance contributions, minimum and maximum amount of the object of mandatory contributions and procedures for the specification thereof.

(7) The object of mandatory contributions determined in Paragraph one of this Sections shall not include the contributions made in favour of an employee by an employer in private pension funds in conformity with licensed pension plans, paid amounts of life assurance (with accumulation of funds) premiums and paid amounts of life, health or accident insurance premiums (without accumulation of funds) in accordance with the provisions of the Law On Personal Income Tax.

(8) Payments of mandatory insurance premiums of an employer in the cases determined in laws and regulations when an insurance contract was entered into in favour of an employee shall not be the object of mandatory contributions.

(9) [27 October 2005]

(10) The object of mandatory contributions for a person who has entered into a work-performance contract, a sharecropping contract or a contract of carriage provided for in Part IV, Section 15 of the Civil Law and has not been registered as an economic activity income tax payer shall be the reimbursement determined in the contract.

(11) The object of mandatory contributions for an authorised representative of a foreign merchant, who not being in employment legal relationships with such merchant represents those activities, which are associated with the branches of the foreign merchant shall be the remuneration calculated thereto.

(12) The object of mandatory contributions of a member of the Saeima, a local government councillor, a member of the Cabinet, a member of the board of directors, council of a commercial company, head clerk, controller, a volunteer probation officer of the State Probation Service as well as other persons holding a position which gives the right to remuneration, shall be the remuneration determined.

(121) The object of mandatory contributions for a member of the board of directors of a capital company who conforms to the status of an employee in accordance with the conditions of Section 1, Clause 2, Sub-clause "m" of this Law shall be not less than the minimum monthly wage stipulated by the Cabinet.

(122) The condition of Paragraph 12.1 of this Section shall not be applied to a member of the board of directors of a capital company who conforms to the status of an employee in accordance with the conditions of Section 1, Clause 2, Sub-clause "m" of this Law and who has been determined remuneration as the member of the board of directors, which is not less than the amount of five minimum monthly wages stipulated by the Cabinet in a capital company which is the participant of one group of undertakings within the meaning of the Law On Enterprise Income Tax.

(123) Paragraph 12.1 of this Section shall not be applied in the calendar year in which the capital company is registered in the Enterprise Register.

(13) The maximum amount of the object of mandatory contributions laid down in Paragraph five of this Section shall not be applied for a person to whom Regulation (EEC, EURATOM, ECSC) No 259/68 of the Council of 29 February 1968 laying down the Staff Regulations of Officials and the Conditions of Employment of Other Servants of the European Communities (Staff Regulations of Officials), if the pension capital accumulated in the European Union pension scheme is transferred to the State pension system of Latvia.

(14) The minimum amount of the object of mandatory contributions and the maximum amount of the object of mandatory contributions shall not be applied for natural persons which perform economic activity and pay patent fee for it.

(15) The State Social Insurance Agency shall calculate the object of mandatory contributions in accordance with the payment into the account of the special budget for natural persons which are performing economic activity and paying the patent fee for it.

(16) The State Social Insurance Agency shall calculate the object of mandatory insurance contributions of employees paying the income tax of seasonal agricultural workers in proportion to the payments into the special budget account by applying an appropriate mandatory contribution rate to an employee's actual income.

(17) For a person whose payment has been fixed in accordance with the Law On Aid for the Activities of Start-up Companies, the contribution object shall be the fixed payment object provided for in the Law.

[10 June 1998; 25 November 1999; 20 June 2001; 6 June 2002; 3 April 2003; 22 January 2004; 17 March 2005; 27 October 2005; 19 December 2006; 19 June 2008; 11 December 2008; 1 December 2009; 3 December 2009; 9 August 2010; 20 December 2010; 6 November 2013; 13 March 2014; 17 December 2014; 22 September 2016; 23 November 2016 / The amendment of Paragraph two on deleting the second sentence shall come into force on 1 January 2017. See Paragraph 57 of Transitional Provisions]

Section 15. Administration of Mandatory Contributions

Mandatory contributions shall be administered in accordance with the procedures laid down in laws and regulations.

Section 16. Late Charges

(1) [19 December 2006]

(2) Late charges shall be recovered for the missed time period for making mandatory contributions from the amount of mandatory contributions unpaid (principle debt) for each late payment day in accordance with the Law On Taxes and Duties.

(3) The late charges shall be paid or recovered from the financial resources of an employer, a self-employed person, a domestic employee at a foreign employer and a foreign employee at a foreign employer.

[10 June 1998; 25 November 1999; 22 January 2004; 19 December 2006]

Section 16.1 Responsibility of Payers for Other Violations of the Law

(1) If an employer has employed or employs a person without entering into an employment, work-performance, sharecropping contract or a carriage contract, and the employer has calculated or paid out or he or she had to calculate and pay out to the employee income, from which mandatory contributions were to be calculated, but this income has not been indicated in the accounting record and in the report submitted to the State Revenue Service on State social insurance mandatory contributions from the income for work of the employees, personal income tax and State fee of business risk in the accounting month and mandatory contributions have not been calculated from it, the State Revenue Service shall recover from the employer the mandatory contributions from the amount which corresponds to the information at the disposal of the State Revenue Service regarding reimbursement to be calculated for the person, if it is possible to determine the amount thereof and if it is larger than the amount of the minimum wage determined by the Cabinet, or from the amount of the minimum wage determined by the Cabinet if the reimbursement to be calculated is equal to or lower than that or if it is not possible to determine the actual reimbursement, and a fine in the amount of three times the mandatory contributions. If it is not possible to determine a time period in which an employer has employed a person without entering into an employment, work-performance, sharecropping contract or a carriage contract, it shall be considered that a person has been employed for three months already, including the month in which such violation has been disclosed, unless the employer or employee may prove a shorter duration of existence of employment legal relationships.

(11) If an employer has employed or employs a person by entering into an employment, work-performance, sharecropping contract or a carriage contract, but the income calculated or paid out to the employee or the income which had to be calculated and disbursed and from which mandatory contributions were to be calculated, has not been indicated in the accounting record and in the report submitted to the State Revenue Service regarding State social insurance mandatory contributions from the income for work of the employees, personal income tax and State fee of business risk in the accounting month and mandatory contributions have not been calculated from it, the State Revenue Service shall recover from the employer the difference between the amount of mandatory contributions that shall be calculated in accordance with the information at the disposal of the State Revenue Service and the amount of mandatory contributions calculated by the employer, as well as a fine in the amount of three times the mandatory contributions.

(2) [15 December 2011].

(3) If it has been determined that an employer has employed a person without entering into an employment, work-performance, sharecropping contract or a carriage contract, but the State Revenue Service is not able to identify the employed person, mandatory contributions and fine shall be recovered in accordance with the procedures laid down in Paragraph one of this Section without personification thereof.

(4) [27 October 2005]

(5) If an employer has calculated mandatory contributions of persons referred to in Section 1, Paragraph 2, Sub-paragraph "a" of this Law from a salary which is lower than the minimum wage stipulated by the Cabinet and a supporting document does not exist certifying thereof, the tax authority shall recover from the employer the mandatory contributions and a fine in the amount of three times the mandatory contributions from the amount corresponding to the amount of the minimum wage stipulated by the Cabinet.

(51) The State Revenue Service, when performing tax inspection (audit), has the right to clarify the income for work of the employee calculated by the employer and determine it on the basis of calculation that is performed in accordance with the information at the disposal of the State Revenue Service, if both of the following conditions exist:

1) the information regarding income of the employer from which it was possible to perform larger remuneration to the employees than it was determined in the accounting record is at the disposal of the State Revenue Service;

2) the employer fails to ensure evidence for the calculation of substantiation for the referred to income for work.

(52) If the income for work of the employee to be calculated by the employer is determined on the basis of the calculation in accordance with Paragraph 5.1 of this Section, the State Revenue Service shall recover from the employer the difference of mandatory contributions between the amount of mandatory contributions that is determined on the basis of calculation that is performed in accordance with the information at the disposal of the State Revenue Service and the amount of mandatory contributions calculated by the employer, as well as a fine in the amount of three times the mandatory contributions.

(6) [19 December 2006]

[25 November 1999; 20 June 2001; 6 June 2002; 22 January 2004; 17 March 2005; 27 October 2005; 19 December 2006; 19 June 2008; 11 December 2008; 20 December 2010; 15 December 2011]

Section 17. Procedures for Utilisation of Fines and Late Charges

The Treasury shall include a fine, which has been calculated as the result of inspections carried out by the State Revenue Service and a late charge in each special budget in conformity with the proportion of such special budget laid down in the State annual budget law.

[25 November 1999; 19 December 2006]

Section 18. Rates of Mandatory and Voluntary Contributions

(1) If an employee has been insured for all types of social insurance, the mandatory contribution rate shall be 34.09 per cent from which an employer shall pay 23.59 per cent and an employee shall pay 10.50 per cent.

(2) The Cabinet shall determine the mandatory contribution rate for persons subject to mandatory social insurance and the distribution thereof according to the types of social insurance.

(3) The voluntary contribution rate shall be the rate stipulated by the Cabinet for pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance.

[25 November 1999; 6 June 2002; 17 March 2005; 8 November 2007; 20 December 2010; 6 November 2013; 22 September 2016 / The new wording of Paragraph two shall come into force on 1 January 2017. See Paragraph 57 of Transitional Provisions]

Section 19. Mandatory Contributions from State Basic Budget and Special Budgets

(1) In accordance with the procedures stipulated by the Cabinet:

1) mandatory contributions for pension insurance for the persons referred to in Section 6, Paragraph four, Clauses 2, 6, 7, 8, 9 and 11 of this Law shall be made from the State basic budget;

2) mandatory contributions for unemployment insurance for the persons referred to in Section 6, Paragraph five, Clauses 2, 4, 5 and 7 of this Law shall be made from the State basic budget;

3) mandatory contributions for pension insurance for the persons referred to in Section 6, Paragraph four, Clause 3 of this Law shall be made from the employment special budget;

4) mandatory contributions for pension insurance for the persons referred to in Section 6, Paragraph four, Clauses 4, 5 and 10 of this Law and for unemployment insurance for the persons referred to in Section 6, Paragraph five, Clauses 3 and 6 of this Law shall be made from the disability, maternity and sickness special budget;

5) mandatory contributions for pension insurance for the persons referred to in Section 6, Paragraph four, Clauses 4 and 5 of this Law and for unemployment insurance for the persons referred to in Section 6, Paragraph five, Clause 3 of this Law shall be made from the special budget for occupational accidents if the cause of the disability or sickness of such persons is an accident at work or an occupational disease;

6) mandatory contributions for disability insurance for persons referred to in Section 6, Paragraph 5.1, Clauses 1 and 2 of this Law shall be made from the special budget for disability, maternity and sickness;

7) mandatory contributions for the persons referred to in Section 6, Paragraph 5.1, Clauses 3 and 4 of this Law shall be made from the State basic budget.

(2) Mandatory contributions from the State basic budget or special budgets shall not be paid for the days of reporting month for which mandatory payments have been calculated or paid for a person as an employee, a domestic employee at a foreign employer, a foreign employee at an employer foreigner or as self-employed.

(3) The State Social Insurance Agency shall cancel a person's registered mandatory contributions from the State basic budget and the special budgets for the periods of time in which there is information about the respective person being insured or employed in another Member State or a country with which Latvia has a social security agreement. After cancelling the mandatory contributions, the State Social Security Agency within a month shall review the State pension granted to the respective person. The State pension shall be re-calculated starting with the first date of the month following the month in which the contributions have been cancelled.

[10 June 1998; 25 November 1999; 22 January 2004; 27 October 2005; 26 April 2007; 8 November 2007; 19 June 2008; 11 December 2008; 1 December 2009; 15 December 2011; 12 March 2015; 22 September 2016; 23 November 2016]

Chapter V
Calculation of Mandatory Contributions

Section 20. Determination of Amount of Mandatory Contributions

(1) An employer shall calculate a mandatory contribution to be made for each employee multiplying the object of contributions by the mandatory contribution rate determined for the employer, if the employee is insured in all types of social insurance.

(2) An employer shall calculate the mandatory contribution to be made by an employee multiplying the object of contributions by the mandatory contribution rate determined for the employee if the employee is insured in all types of social insurance.

(3) An employer shall calculate a mandatory contribution to be made for each employee who:

1) has reached the age which gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term) multiplying the object of contributions by the mandatory contribution rate which has been determined for the employer for State pension insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance;

2) is a recipient of a service pension or a person with disability - recipient of a State special pension - multiplying the object of contributions by the mandatory contribution rate which has been determined for the employee's State pension insurance, maternity and sickness insurance, parents' insurance and occupational accident insurance.

(4) The employer shall calculate a mandatory contribution to be made by an employee who:

1) has reached the age which gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term) multiplying the object of contributions by the mandatory contribution rate which has been determined to the employer for the State pension insurance, parents' insurance and maternity and sickness insurance;

2) is a recipient of a service pension or a person with disability - recipient of State special pension - multiplying the object of contributions by the mandatory contribution rate which has been determined for the employee's State pension insurance, disability insurance, parents' insurance and maternity and sickness insurance.

(5) A foreign employee at a foreign employer shall calculate a mandatory contribution multiplying the object of mandatory contributions by the mandatory contribution rate laid down in Section 18 of this Law, except the rate determined for occupational accident insurance and unemployment insurance, starting with the 184th day since he or she has been residing in the Republic of Latvia, or with the 367th day of residence if the duration of work exceeds 12 months for the person who has been sent to perform particular work in the territory of the Republic of Latvia for a time period not longer than 12 months.

(6) A self-employed person (except a natural person who is performing economic activity and paying a patent fee for it) shall calculate a mandatory contribution multiplying the object of contributions by the mandatory contribution rate determined for self-employed persons.

(7) A domestic employee at a foreign employer shall:

1) calculate a mandatory contribution multiplying the object of mandatory contributions by the mandatory contribution rate laid down in Section 18 of this Law;

2) if such employee has reached the age which gives the right to receive the State old-age pension or whom the State old-age pension has been granted (including before term), calculate a mandatory contribution multiplying the object of mandatory contributions by the mandatory contribution rate laid down in Section 18 of this Law, except the rate determined for unemployment insurance and disability insurance;

3) if this employee is a recipient of a service pension or a person with disability - recipient of a State special pension, the mandatory contribution shall be calculated by multiplying the object of mandatory contributions by the mandatory contribution rate laid down in Section 18 of this Law, except the rate determined for unemployment insurance.

(8) On the next day after the day when the restriction laid down in Section 11.12, Paragraph two, Clauses 1 and 2 of the Law On Personal Income Tax has been reached, the disburser of a seasonal agricultural workers income (employer) shall register each seasonal agricultural worker's - income tax payer's change of status by submitting information on the employees to the State Revenue Service in accordance with the procedures and within the time period provided for by the Cabinet and shall start to pay mandatory contributions from the income acquired in seasonal agricultural work in accordance with the general procedures laid down in this Law.

[10 June 1998; 25 November 1999; 20 June 2001; 6 June 2002; 22 January 2004; 17 March 2005; 8 November 2007; 19 June 2008; 11 December 2008; 3 December 2009; 15 December 2011; 13 March 2014; 22 September 2016]

Section 20.1 Updating of the Amount of Income from Work and Mandatory Contributions

(1) The employer shall update the income for work and mandatory contributions of the employee for the previous month before the accounting month.

(11) [20 December 2016]

(2) If the employer has not updated the income for work and mandatory contributions of the employee for the previous month before the reporting month, the employer has the right to update them within three years. The income for work and mandatory contributions of the employee may not reduce as a result of updating. Updating of the income for work and mandatory contributions of the employee shall not change the amount of social insurance services already granted, except the amount of the State old-age pension (including the amount of the State old-age pension granted early.

(21) [20 December 2016]

(3) In addition to that laid down in Paragraphs one and two of this Section the Cabinet shall determine the cases when the State Revenue Service, the employer and the administrator of insolvency proceedings shall update the income for work and mandatory contributions of the employee for the previous reporting months. The amount of the social insurance service already granted after updating the income for work and mandatory contributions of the employee shall be changed on the basis of a submission of the person.

(4) The procedures by which the employer, the State Revenue Service and the administrator of insolvency proceedings shall update the income for work and mandatory contributions of the employee and the procedures by which mandatory contributions shall be calculated and paid to persons for whom in accordance with the Law On Reimbursement of Losses Caused by State Administrative Institutions work income is compensated, as well as by which reports regarding mandatory contributions shall be provided shall be determined by the Cabinet.

(5) The disburser of a seasonal agricultural workers income (employer) shall not be entitled to adjust the submitted information on the seasonal agricultural worker's - income tax payer's income and his or her calculated income tax.

(6) Within a month after the day which has been fixed for making the mandatory contributions, a self-employed person shall have the right to adjust the object of mandatory contributions and the mandatory contributions for the reporting quarter once.

[20 December 2012; 13 March 2014; 30 November 2015; 22 September 2016; 20 December 2016 / Paragraph six shall come into force on 1 January 2017. See Paragraph 57 of Transitional Provisions]

Section 20.2 Determination of the Amount of Mandatory Contributions and Performance from the Income for Exercising the Right to Purchase Stocks Granted by an Employer or an Undertaking Related to an Employer within the Meaning of the Law On Enterprise Income Tax for Employees with whom Employment Relationship has been Terminated

(1) Income earned from exercising the right to purchase stocks granted to an employee by an employer or an undertaking related to an employer within the meaning of the Law On Enterprise Income Tax, if the employee has terminated employment relationship with the employer on the day of exercising the right to purchase stocks, shall apply to the taxation period in which employment relationship was terminated.

(2) The employer shall calculate mandatory contributions for each employee with whom employment relationship has been terminated and who initially was granted the right to purchase stocks, multiplying the income taxable with personal income tax laid down in Section 8, Paragraph 2.5 of the Law On Personal Income Tax by the rate of mandatory contributions, which was applicable to the employee with whom employment relationship has been terminated in the last month when employment relationship existed.

(3) The employer shall perform mandatory contributions (both the part of the employer and of the employee) from its own funds.

(4) The employer shall pay the mandatory contributions into the special budget account for each employee with whom employment relationship has been terminated and who initially was granted the right to purchase stocks, within the following time period indicated in the notification issued by the State Revenue Service when income from exercising the right to purchase stocks was earned.

(5) The employer has a duty to update the amount of income for work and mandatory contributions until the time period laid down for the performance of mandatory contributions in accordance with Section 20.1 of this Law for employees with whom employment relationship has been terminated and to submit a report to the State Revenue Service on the object of mandatory contributions and the mandatory contributions from the income of such employees earned in the reporting month, implementing the granted right to purchase stocks and alienating such right, according to the procedures laid down by the Cabinet.

[20 December 2012]

Section 20.3 Minimum Amount of the Object of Mandatory Contributions per Reporting Month for an Employee and an Employer, its Determination and the Payment of Mandatory Contributions

[20 December 2016]

Section 21. Procedures and Time Periods for Making Contributions

(1) An employer shall pay mandatory contributions once a month into a special budget account for each employee in the time periods indicated in the notification issued by the State Revenue Service.

(2) An employee shall make mandatory contributions through his or her employer. The employer shall deduct the contributions to be made by the employee and pay them into a special budget account in the time periods laid down in Paragraph one of this Section.

(21) If an employer has not made social insurance contributions determined by this Law, a person regarding whom an employer must have been made them and who has reached the age that gives the right to receive the State old-age pension may make social insurance contributions for pension insurance. The Cabinet shall regulate the provisions, time periods and procedures by which a person shall make social insurance contributions for pension insurance.

(3) A self-employed person (except a natural person who is performing economic activity and paying patent fee for it) shall make mandatory contributions by the 15th date of the month following the reference quarter.

(4) A domestic employee at a foreign employer and a foreign employee at a foreign employer shall make mandatory contributions by the 15th date of the month following the reference quarter.

(5) Persons who joined pension insurance, disability insurance, maternity and sickness insurance, and parents' insurance voluntarily shall make the voluntary contributions by the last day of each month.

(6) [20 June 2001]

(7) Late mandatory contributions shall be made in accordance with the Law On Taxes and Duties.

(8) [20 June 2001]

(9) If the payment of paid income for work is delayed, an employer has a duty to make mandatory contributions for the calculated income for work in a time period in which they should be made if the income for work would be paid timely.

(10) The carrier referred to in Section 35 of the Law On Carriage by Road shall pay an advance on the mandatory contributions in the amount of 130 euros per calendar month for each taxi carrying passengers into the account specially established for this purpose. The carrier shall be entitled to reduce the payment of the monthly mandatory contributions by the amount paid in advance. In these cases, the provisions laid down in Section 21.1, Paragraph four of this Law shall not be applied.

[10 June 1998; 20 June 2001; 8 November 2007; 3 December 2009; 20 December 2010; 23 November 2016]

Section 21.1 Refund of Overpaid Contributions

(1) Contributions overpaid within a time period of a calendar year shall be calculated by the State Social Insurance Agency within three months after the end of the calendar year in accordance with the procedures stipulated by the Cabinet.

(2) The State Social Insurance Agency shall refund the overpaid contributions of socially insured persons in accordance with the procedures stipulated by the Cabinet.

(3) The overpaid contributions the amount of, which does not reach the minimum wage stipulated by the State, shall be accumulated and refunded after the end of such calendar year in which they reach or exceed the minimum wage stipulated by the State.

(4) The State Revenue Service shall redirect the overpaid mandatory contributions of each employer for covering other tax debts, if any, or include in the payments of following periods, or refund upon request of the employer.

(5) In calculating person's overpaid contributions for the calendar year, the State Social Insurance Agency shall be entitled to write off the contribution difference created by rounding the amount of the contribution but not more than one euro per one socially insured person.

[25 November 1999; 22 September 2016 / Paragraph 1.1 and the new wording of Paragraph three shall come into force on 1 January 2018 and shall be included in the wording of the Law on 1 January 2018. See Paragraph 58 of Transitional Provisions]

Section 21.2 The Object of Mandatory Contributions Exceeding the Maximum Amount of Mandatory Contributions

(1) The object of mandatory contributions which exceeds the maximum amount of the object of mandatory contributions laid down in Section 14, Paragraph five of this Law shall be deemed to be the solidarity tax object.

(2) The mandatory contributions made from the object laid down in Paragraph one of this Section shall be redirected to the solidarity tax.

(3) The procedures by which the State Social Insurance Agency lists, calculates and pays the solidarity tax into the State basic budget shall be determined by the Cabinet.

[30 November 2015]

Section 21.3 Transfer of the Mandatory Contributions from another Member State in Accordance with the Regulation

(1) Based on the application of a person and co-operating with the competent authority of another Member State, the State Social Insurance Agency shall carry out the transfer of mandatory contributions from another Member State and inform the State Revenue Service thereof.

(2) The mandatory contributions shall be transferred only for the previous period about which the State Social Insurance Agency has agreed with the competent authority of another Member State and which does not exceed the time which has been indicated in the decision on applicable laws (Certificate A1).

(3) Mandatory contributions made in another Member State shall be transferred to the State social insurance special budget without late charges.

(4) The transferred mandatory contributions shall not be adjusted.

(5) The State Social Insurance Agency shall calculate and register the transferred mandatory contributions and the object of mandatory contributions proportionally, taking into account the mandatory contribution rate applied to a person either as an employee or a self-employed person within the relevant period in Latvia. If the amount of the calculated object of mandatory contributions for the calendar year exceeds the maximum amount of the object of mandatory contributions, the maximum amount of the object of mandatory contributions shall be registered for the respective person. The overpaid transferred mandatory contributions shall not be refunded.

(6) The transfer of the mandatory contributions shall not change the amount of the insurance service granted to the respective person, except for the old-age pension. After registering the mandatory contributions, the State Social Insurance Agency shall, within a month, review the old-age pension granted to the respective person. The old-age pension shall be re-calculated starting with the first date of the month following the month in which the contributions have been registered.

(7) Within 10 working days after registering the transferred mandatory contributions, the State Social Insurance Agency shall ensure their registration also in the participant accounts of the State funded pension scheme. The mandatory contributions to the participant accounts of the State funded pension scheme shall be registered taking into account the contribution rate of the State funded pension scheme for the relevant period of time.

[22 September 2016]

Section 21.4 Transfer of the Mandatory Contributions to Another Member State in Accordance with the Regulation

(1) At the request of another Member State's competent authority, the State Social Insurance Agency shall hand over to another Member State the actually made mandatory contributions for the period which has been specified in the decision on determining the applicable laws (Certificate A1) and shall inform the State Revenue Service about the person whose mandatory contributions have been transferred and the period for which the mandatory contributions have been calculated.

(2) After receiving the information referred to in Paragraph one of this Section from the State Social Insurance Agency, the State Revenue Service shall revoke the information included in the employer's report.

(3) The mandatory contributions shall be transferred from the expenditures of each of the State social insurance special budget in accordance with the share of each special budget pursuant to the Law On the State Budget for the relevant year.

(4) The mandatory contributions for the months which have been taken into account in calculating the sums for a social service shall not be transferred.

(5) After transferring the mandatory contributions, the State Social Insurance Agency shall review the respective person's rights to a social insurance service or the amount of the service granted to him or her. If a person loses his or her rights to a social insurance service or the amount of the service changes, the State Social Insurance Agency, starting with the first date of the month following the month in which the contributions have been transferred, shall terminate the payment of the social insurance service or review the amount of the service.

(6) If in the period in which the mandatory contributions have to be transferred the respective person is a participant of the State funded pension scheme, the State Social Insurance Agency, within five working days after the receipt of a request, shall give the manager of the State funded pension scheme funds the task to transfer the person's accrued funded pension capital to the State pension special budget. If after the transfer of the contributions the participant of the State funded pension scheme is no more a socially insured person (is not subject to State pension insurance), the State Social Insurance Agency shall ensure the closure of the State funded pension scheme participant's account.

[22 September 2016]

Section 22. Inclusion of Mandatory Contributions in Special Budget Accounts

(1) The Treasury shall daily pay mandatory contributions into special budget accounts in conformity with the proportion of such special budget laid down in the State annual budget law.

(2) If, in planning the State annual budget law, income and surplus of resources of previous years do not cover annual budget expenditures in any of the special budgets, but there is a surplus in another special budget, in calculating the proportion of each special budget income, the financing for covering of budget expenditures shall be included.

[25 November 1999; 16 June 2009; 20 December 2012]

Section 23. Report Regarding Mandatory Contributions

(1) By the time period determined for making mandatory contributions, the employer has a duty once a month to submit a report regarding the object of mandatory contributions and the mandatory contributions from the income for work of employees in a reporting month to the State Revenue Service in accordance with the procedures stipulated by the Cabinet.

(11) The employer who updates the income for work of an employee and mandatory contributions in accordance with the procedures laid down in Section 20.1, Paragraph two of this Law, may update once each reporting month.

(12) The disburser of a seasonal agricultural workers income (employer) shall have the obligation within five working days after the last day of the month in which he or she has gained income to submit to the State Revenue Service an employer's report on the income of the seasonal agricultural worker - income tax payer, and the calculated seasonal agricultural workers income tax in the reporting month. The procedures by which the disburser of a seasonal agricultural workers income (employer) submits employer's report to the State Revenue Service shall be provided for by the Cabinet.

(13) [20 December 2016]

(14) The State Revenue Service shall not accept employer's reports in which the information on the employees does not conform to the employees' status periods.

(2) By the time period determined for making mandatory contributions, self-employed persons (except a natural person who is performing economic activity and paying a patent fee for it), domestic employees at a foreign employer and foreign employees at a foreign employer have a duty to submit to the State Revenue Service a report regarding the object of mandatory contributions and the mandatory contributions in accordance with the procedures stipulated by the Cabinet.

(3) In accordance with the procedures stipulated by the Cabinet the State Revenue Service shall submit to the State Social Insurance Agency information regarding social insurance contributions made and the social tax payments made. The State Social Insurance Agency shall, according to the procedures stipulated by the Cabinet, register the mandatory payments and social tax payments and shall recalculate the mandatory payment object if such payments have not been made to the full amount.

(4) The State Social Insurance Agency, on the basis of a socially insured person personally requesting or submitting in writing a request at any office of the State Social Insurance Agency, shall issue or send without charge information regarding the status of the insurance accounts of such person.

(5) The State Revenue Service has the right to update and correct the information submitted by the performers of mandatory contributions, if mistakes have been encountered in the information submitted by the performers of mandatory contributions or reports regarding mandatory contributions on the basis of the information provided by other State institutions. In such case within 10 working days the State Revenue Service shall inform the performer of mandatory contributions regarding the corrections made.

[25 November 1999; 20 June 2001; 17 March 2005; 15 June 2006; 19 June 2008; 16 June 2009; 3 December 2009; 20 December 2012; 13 March 2014; 30 November 2015; 23 November 2016; 20 December 2016 / Paragraph 1.4 shall come into force on 1 July 2017. See Paragraph 62 of Transitional Provisions]

Chapter VI
State Mandatory Social Insurance Administration

Section 24. State Social Insurance Agency

(1) By 31 December 2003:

1) the State Social Insurance Agency (hereinafter - Agency) is a non-profit organisation State stock company which operates in accordance with this Law, the Law On Non-profit Organisations, the Law On Stock Companies, other laws and regulations and its articles of association;

2) the Agency is a legal person, it has its own current accounts in banks and its own seal;

3) the Agency is the manager of the budgets laid down in Section 7 of this Law;

4) the operation of the Agency is controlled by a council appointed by the Cabinet which council includes representatives recommended by the Minister for Welfare;

5) the chair of the council of the Agency is the Minister for Welfare, as well as the representative of the holder of State capital shares in the Agency;

6) the Cabinet shall appoint the Director-General of the Agency on the basis of a recommendation from the Minister for Welfare.

(2) From 1 January 2004:

1) the Agency is a State agency supervised by the Ministry of Welfare, which implements State policy in the field of social insurance and State social benefits;

2) the Agency is engaged in the administration of special budgets, as well as in administration of social insurance services and State social benefits transferred to the competence of the Agency in accordance with laws and regulations;

3) the Agency territorial units are Agency offices.

(3) From 1 January 2011 the Agency shall administer service pensions that have been granted in accordance with Law On the Service Pension of State and Local Government Professional Orchestra, Choir, Concert Organisation, Theatre and Circus Artists and the Allowance for Creative Work of Ballet Artists, Law On the Service Pension of Judges, Law On the Service Pension of Diplomats, Law On the Service Pension of Officials of the Corruption Prevention and Combating Bureau, Law On the Service Pension of Prosecutor, Law On the Service Pensions of Employees with Special Service Ranks Working in the System of the Ministry of the Interior and the By-law Regarding Pensions of Rank-and-file and Commanding Officers of the Institutions of Interior (Employers Pensions) (hereinafter - service pensions).

(4) From 15 January 2013 the Agency shall be a State authority of direct administration under the supervision of the Minister for Welfare, which carries out the functions laid down in Paragraphs two and three of this Section.

[3 April 2003; 22 January 2004; 20 December 2010; 20 December 2012]

Section 24.1 Social Insurance Information System

The Social Insurance Information System (SIIS) is a State information system which, in accordance with the procedures laid down in the laws and regulations, includes information received from the State and local government authorities, natural and legal persons, including personal data in order to ensure the records of socially insured persons, the granting and payment of social insurance services, State benefits and service pensions, the control of the outturn of the State budget funds as well as high quality performance of the Agency's other functions. The Agency shall be the manager of the System.

[22 September 2016]

Section 25. Financing the Operation of the Agency

(1) Until 31 December 2003 the operation of the Agency shall be financed from the special budgets in accordance with the procedures prescribed by law, as well as from funds acquired by the Agency as the result of entrepreneurial activities provided for in the articles of association.

(2) As of 1 January 2004 the operation of the Agency shall be financed from the special budget revenue earmarked for particular purposes, from other special purpose earmarked income, from donations and gifts, foreign financial assistance resources, as well as from own revenue.

[3 April 2003; 22 January 2004]

Section 26. Financing the Operation of the Agency

[3 April 2003]

Section 26.1 Request for the Services Administered by the Agency

(1) A person shall submit a request for a social insurance service, a State social benefit and a service pension and the documents necessary for granting thereof personally or electronically to one of the Agency's departments. If the relevant documents are sent electronically, they should be drawn up in accordance with the laws and regulations governing electronic documents.

(2) A person may send a request for a social insurance service (except a State pension) and a State social benefit and the documents necessary for granting thereof by mail or submit them through an authorised person.

(3) A person may request the available services administered by the Agency in the joint State and local government services online portal www.latvija.lv by using the authentication means offered by the portal.

[12 March 2015 / Paragraph three shall come into force on 1 July 2015. See Paragraph 52 of Transitional Provisions]

Section 27. Dispute or Appeal of Administrative Acts issued by the Agency, Extension of Time Period for Issuance Thereof

(1) A person may dispute to the director of the Agency administrative acts issued by Agency officials or actual actions thereof within one month from the day of the coming into effect of the administrative act. The decision of the director of the Agency may be appealed to a court within one month from the day of the coming into effect of the decision of the director.

(2) The submitting of a submission to the director of the Agency or the submission of an application to a court shall not suspend the execution of an administrative act issued by the Agency. The director of the Agency is entitled, by a written decision, to suspend the execution of an adverse administrative act of an addressee if a submission has been received from the person regarding the suspension of the execution of the administrative act.

(3) The director of the Agency has the right, with a motivated decision, to extend the time period for issuance of an administrative act up to three years from the day of receipt of a person's request, if a lasting determination of facts is required for granting of social insurance services or State social benefits in relation to the receipt of information from a competent foreign institution. A decision of the director of the Agency regarding extension of a time period may be appealed to court.

[22 January 2004; 16 June 2009]

Section 27.1 Recovery of Overpayments of Social Insurance Services, State Social Benefits and Service Pensions

(1) The Agency shall recover the overpaid sums of social insurance services, State social benefits and service pensions for no more than a three year period counting from the day of detecting the overpayment, but in cases which for establishing the overpayment need information from a competent authority of a foreign country - for no more than a three year period within a period of six years starting from the day of detecting the overpayment. The Agency shall initiate enforcement activities in order to recover the overpaid sums for a social insurance service, a State social benefit or a service pension granted to the respective person within one year after the deadline for voluntary execution has expired in accordance with the procedures provided for in the Administrative Procedure Law by applying the limitation periods and the conditions for terminating the limitation periods provided for in the Civil Procedure Law.

(2) If the social insurance service, State social benefit or service pension has been granted for a person, the Agency shall perform deductions for recovery of the overpayment of social insurance service, State social benefit or service pension in amount of 10 per cent from each granted social insurance service, State social benefit or service pension. Deductions shall not be made from a childbirth allowance, a one-time benefit to a surviving spouse, a funeral benefit and a compensation for additional expenses due to an accident at work or an occupational disease.

(3) The State Revenue Service in accordance with the procedures provided for by the Cabinet shall refund the Agency the personal income tax deducted from the overpaid service based on the request of the Agency to refund the sum of the tax paid into the State budget revenues. If the person has already regained the personal income tax by submitting a personal income tax return, he or she shall have the obligation to refund the personal income tax deducted for the service and paid into the special budget.

(4) If a person has not been granted a social insurance service, a State social benefit or a service pension or the payment for the abovementioned services has been terminated, the administrative act shall be forwarded to a bailiff for enforced recovery, based on the Agency official's executive order in accordance with the procedures and within the time limit provided for in the Civil Procedure Law. Based on the Agency official's executive order, the Agency shall forward the administrative act to a bailiff for enforced recovery also in case the respective person continues to receive the service and on the day of detecting the overpayment the sum thereof exceeds five times the monthly amount of the social insurance service, the State social benefit and the service pension.

(5) If at the time when the Agency makes deductions due to the overpayment of a social insurance service, a State social benefit or a service pension, the bailiff's order for the recovery of the debt from the abovementioned services has been received, the Agency shall collect the debt for the benefit of other debt collectors after it has deducted the overpayment for a social insurance service, a State social benefit or a service pension.

(6) If the overpayment of social insurance service, State social benefit or service pension has occurred in relation to a person's death, a credit institution or the State stock company Latvijas Pasts shall, upon request of the Agency in writing, repay the overpayment caused from the person's account to the Agency, by transferring to the account determined in the request of the Agency and by deducting the commission of the credit institution or State stock company Latvijas Pasts for the performance of the transfer. Repayment shall be made in such amount that does not exceed the funds available in the account of the dead person in the credit institution or in the postal payment system (PPS).

(7) If the Agency grants a social insurance service, a State social benefit or a service pension for a time period during which any of these services has already been paid for, and the laws and regulations do not provide for concurrent receipt of the abovementioned services, the amount of the granted service costs shall be reduced by the amount of the service disbursed (granted) previously. In this case the amount of a service payable to a person in the first month shall not be less than the monthly sum of the granted service.

(8) If until the person's death day the Agency pays the unpaid social insurance service, the State social benefit or the service pension to the spouse, the first or second degree relatives or in cases specified by laws to another person based on an inheritance certificate or a court ruling, the payable sum shall be reduced by the amount of the overpayment for the abovementioned services.

(9) If an employer, based on a court ruling, reimburses a person for forced absence from work or makes other payments resulting from the legal employment relationship and the laws and regulations do not provide for a concurrent receipt of the abovementioned services and the income gained from the employer for the time when the respective person received a social insurance service, a State social benefit or a service pension, the person shall have the obligation to refund the sum of the granted service to the Agency. In this case the provisions of paragraph one of this Section on the overpayment period and the deadlines for its recovery shall not be applied.

(10) The recovered overpayments of social insurance services, State social benefits and service pensions shall be transferred to the relevant special budget or State basic budget from which the overpaid social insurance service, State social benefit or service pensions were financed.

[22 September 2016 / Paragraph three shall come into force on 1 January 2018. See Paragraph 58 of Transitional Provisions]

Section 28. Right to Write off the Overpayment Sums of Social Insurance Services, State Social Benefits and Service Pensions

The Agency shall write off and exclude from the balance sheet the recorded overpayment sums which have resulted due to the fault of the recipients of social insurance services, State social benefits and the service pensions and whose recovery is impossible due to the limitation period for the execution of the administrative act or the debtor has died and the sum of the debt does not exceed 35 per cent of the State social insurance benefit or if the person has no declared place of residence or his or her place of residence is outside Latvia and more than six years have passed after the administrative act has come into force. If the respective person has died, the Agency shall recover the overpayment which exceeds two minimum monthly wages stipulated by the Cabinet in accordance with the procedures provided for in the laws and regulations.

[22 September 2016]

Section 28.1 Adjusting False Information in the Employers' Reports

The Agency, in accordance with the information at its disposal, shall update and register the false information on the mandatory contributions and the object of mandatory contributions indicated in the employer's report if the employer has not eliminated the mistakes in his or her report within three years.

[22 September 2016]

Section 29. Delivery of Social Insurance Services, State Social Benefits and Service Pensions at the Place of Residence

If a person receives several services (for example, pensions, benefits) administered by the Agency at the place of residence and in accordance with laws and regulations the fee is intended for delivery at the place of residence for each of them, the Agency shall collect one fee for delivery basing on the larger amount of the service to be disbursed.

[20 December 2010]

Transitional Provisions

1. Section 5, Paragraph four of this Law (as of 20 June 2001) shall be applied from 14 March 2001.

[20 June 2001; 17 March 2005]

2. The rate of mandatory contributions laid down in Section 18, Paragraph one of this Law and the distribution thereof between the employer and an employee shall come into force on 1 January 2003.

[20 June 2001]

3. From 1 January 1998 to 31 December 1999 the rate of mandatory contributions shall be 37 percent from which 28 percent shall be paid for by an employer and 9 percent - by an employee.

[25 November 1999]

4. With the coming into force of this Law, the Law On Social Tax (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No.1, 7, 15) is repealed, but:

1) persons making social insurance contributions shall calculate and pay mandatory social insurance contributions in conformity with the social tax object and rates prescribed in the Law On Social Tax (Latvijas Republikas Saeimas un Ministru Kabineta Ziņotājs, 1996, No.3, 21, 29) from all income for work of socially insured persons which has been calculated for the time period from 1 January 1991 to 31 December 1995, but paid after 1 January 1996. The State Revenue Service shall control the accuracy of the calculation and payment of social insurance contributions for this time period; and

2) persons making social insurance contributions shall calculate and make social insurance mandatory contributions in conformity with the social tax object and rates prescribed in the Law On Social Tax (Latvijas Vēstnesis, 1996, No 1, 7, 15) from all income for the work of socially insured persons which has been calculated for the time period from 1 January 1996 to 31 December 1997, but paid after 1 January 1998. The State Revenue Service shall control the accuracy of the calculation and payment of social insurance contributions for this time period.

5. Applications for the transfer of the social tax payment to be made within a time period between 1 January 1995 and 31 December 1997 shall be submitted to the State Revenue Service by 31 December 1998.

6. Late and unpaid social tax payments, increase in the amount of principal debt and late charges which have been formed by 31 December 1997 shall be charged in the following order - principal debt for the time period between 1 January 1996 and 31 December 1997, principal debt for the time period between 1 January 1991 and 31 December 1995, increase in the amount of the principal debt and late charges for the time period between 1 January 1991 and 31 December 1997.

7. In 1998 funds from the State pension special budget, employment special budget, occupational accident special budget and from the disability, maternity and sickness special budget shall be included in the State basic budget for commencing the administration of State social insurance contributions in conformity with the proportion of special budgets in the amount of social insurance service financing in 1998.

8. Section 16, Paragraph two of this Law shall come into force on 1 January 1999. By 31 December 1998 late charges shall be recovered from the employer and self-employed persons for a missed time period for making contributions - 0.1 percent for each late day from the part of mandatory contributions not paid in time.

[10 June 1998]

9. Section 21, Paragraph seven of this Law shall come into force on 1 January 1999. By 31 December 1998, the overdue and outstanding social insurance mandatory contributions shall have to be made in the following order: the principal debt, increase in the principal debt and late charges.

[10 June 1998]

10. Section 21, Paragraph nine of this Law shall come into force on 1 January 1999.

[10 June 1998]

11. Section 1, Clause 3, Sub-clause "i" and Section 6, Paragraph seven of this Law, as well as amendments to Section 6, Paragraph three determining the types of insurance to which self-employed persons who have reached the age giving the right to receive the State old-age pension, and the first and second group disabled persons are subject, shall come into force on 1 January 1998.

[10 June 1998]

12. From 1 January 2000 to 31 December 2002 the rate of mandatory contributions and distribution thereof between the employer and the employee shall be as follows:

1) from 1 January 2000 the rate of mandatory contributions shall be 36 percent from which 27 percent shall be paid by an employer and 9 percent - by an employee;

2) from 1 January 2001 the rate of mandatory contributions shall be 35 percent from which 26 percent shall be paid by an employer and 9 percent - by an employee;

[20 June 2001]

13. By 31 December 2000 domestic employees at a foreign employer shall submit to the State Revenue Service a report regarding the object of mandatory contributions and contributions made in accordance with the procedures laid down in Section 23, Paragraph two of this Law.

[25 November 1999]

14. Amendments to Section 1, Clause 3 of this Law, except for Sub-clauses "b" and "j", Amendments to Section 5, Paragraph three in relation to the voluntary joining of a spouse of a self-employed person to disability insurance, maternity and sickness insurance, Paragraph ten of Section 6, Amendments to Paragraph two of Section 12, Paragraph three of Section 13, Amendments to Section 17, Amendments to Paragraph three of Section 18, Amendments to Clause 5 of Section 19, Amendments to Paragraph five of Section 20, Amendments to Section 22 and Paragraphs one and two of Section 23 of this Law shall come into force on 1 January 2001.

[25 November 1999]

15. Cancellation of the principal debt of the capitalised social tax payment and late charges related thereto in conformity with Section 25 of the Law On Taxes and Duties shall have the same legal consequences as the payment of the principal debt of such tax payment and late charges.

[25 November 1999]

16. Clause 15 of these Transitional Provisions shall also apply to the principal debt of the capitalised social tax payment and cancellation of late charges related thereto which has been performed from 1 January 1998 by the day of coming into force of this Law.

[25 November 1999]

17. If an employer has not made the mandatory contributions in full by 13 March 2001 (inclusive), the paid amount shall be distributed proportionally between the employees of the relevant employer.

[20 June 2001]

18. Section 20, Paragraph five of this Law shall come into force on 1 January 2003. From 1 January 2001 to 31 December 2002 a foreign employee at a foreign employer shall calculate a mandatory contribution multiplying the object of mandatory contributions by the mandatory contribution rate determined to the employee if the employee has been insured in all types of social insurance, except for a rate determined for occupational accident insurance and unemployment insurance, starting with the 184th day after the arrival in the Republic of Latvia or the 367th day if the duration of work exceeds 12 months for the persons who have been sent to perform particular work in the territory of the Republic of Latvia for a time period not longer than 12 months.

[20 June 2001]

19. Section 1, Clause 3, Sub-clause "c" (as of 20 June 2001) and Section 6, Paragraph thirteen of this Law shall be applied from 1 January 2001.

[20 June 2001]

20. A person who is an employee in accordance with Section 1, Clause 2 of this Law and receives concurrently a royalty has the right in 2001 not to make social insurance mandatory contributions from the income acquired in the form of a royalty. If in 2001 the referred to person chooses to make concurrently also social insurance mandatory contributions from the income acquired in the form of a royalty such contributions shall be made in conformity with the social insurance contribution rate laid down for self-employed persons and in accordance with time periods and procedures laid down for self-employed persons.

[27 July 2001]

21. Amendments to Paragraph one of Section 5, Paragraph four, Clause 1 and Paragraph five, Clause 1 of Section 6 in relation to persons performing alternative service, as well as Paragraphs fifteen and sixteen of Section 6 shall come into force on 1 July 2002.

[6 June 2002]

22. Clause 3, Sub-clause "l" of Section 1 and Paragraph fourteen of Section 6, as well as Amendments to Paragraph seven of Section 14 shall be applied from 1 January 2002.

[6 June 2002]

23. Amendments in the Law of 6 June 2002 to Section 6, Paragraph two in relation to subjection of employees - Group I or II disabled persons to disability insurance, in Paragraph three of Section 6 in relation to subjection of self-employed persons - Group I or II disabled persons to disability insurance, in Paragraph nine of Section 6 in relation to subjection of domestic employees at a foreign employer - Group I or II disabled persons to disability insurance, as well as in Paragraphs three, four and seven of Section 20 in relation to subjection of domestic employees at a foreign employer - Group I or II disabled persons to disability insurance shall come into force on 1 January 2003.

[6 June 2002; 17 March 2005]

24. Cabinet Regulation No.436 of 23 December 1997, Articles of Association of the Non-profit-making Organisation the State Stock Company "Valsts sociālas apdrošināšanas aģentūra" [State Social Insurance Agency] shall be applied by 31 December 2003.

[3 April 2003]

25. The amendments to Section 6, Paragraphs two and nine and Section 20, Paragraph three, Clause 2; Paragraph four, Clause 2 and Paragraph seven, Clause 3 in relation to those employees not being subject to insurance against unemployment who receive a service pension or who are Group III disabled persons - recipients of State special pensions, shall come into force on 1 July 2004.

[22 January 2004]

26. From 1 January 1991 to 13 March 2001 (inclusive) a person is socially insured commencing from the day when he or she has acquired the status of employee or has been called up for mandatory active military service irrespective of the fact whether actual mandatory payments (social tax) have been made.

[17 March 2005; 19 June 2008]

27. If for the persons referred to in Paragraph 26 of these Transitional Provisions, the mandatory payments (social tax) administration has not registered the mandatory payments (social tax) object in conformity with the provisions of Section 14, Paragraph one of this Law, the mandatory payments (social tax) object shall be the minimum wag stipulated by the Cabinet for the relevant time period.

[17 March 2005]

28. Amendments to Section 1, Clause 4 of this Law in relation to persons who are employed by another Member State employer and to whom in accordance with Articles 13, 14, 15, 16 and 17 of the Regulation laws and regulations of the Republic of Latvia are applicable, shall come into force on 1 January 2006.

[17 March 2005]

29. Amendments to Section 6, Paragraph two of this Law in relation to employees - Group I and II disabled persons being subject to insurance against unemployment, Paragraph nine in relation to domestic employees at a foreign employer - Group I and II disabled persons being subject to insurance against unemployment, as well as Section 20, Paragraphs three, four and seven in relation to employees and domestic employees at a foreign employer - Group I and II disabled persons being subject to insurance against unemployment, shall come into force on 1 January 2006.

[17 March 2005]

30. Amendments to Section 6, Paragraph five of this Law in relation to recipients of maternity benefits being subject to insurance against unemployment shall come into force on 1 January 2006.

[17 March 2005]

31. Amendments to Section 6, Paragraphs eight and nine and Section 20, Paragraph seven of this Law in relation to domestic employees at a foreign employer being subject to insurance against occupational accidents, shall come into force on 1 January 2006.

[17 March 2005]

32. Section 6, Paragraph seventeen of this Law shall come into force on 1 January 2006.

[17 March 2005]

33. The new text of Section 18, Paragraph one of this Law regarding the specification of rates of mandatory payments if the employee has been insured in all types of social insurance to the amount of 33.09 per cent, of which 24.09 per cent is paid by the employer and 9 per cent by the employee, shall come into force on 1 January 2006.

[17 March 2005]

34. Up to the day when the Law comes into force, which shall specify the future status of individual undertakings, in addition to the persons referred to in Section 1, Clause 2 of this Law, as employers shall be deemed:

1) an owner of an individual undertaking (which is founded in order to operate with craft activities within the meaning of the Law On Craft Activities) who not being in employment legal relations with the administrative authority of his or her undertaking, performs the operational management function of such an undertaking if, in accordance with the procedures prescribed by law, a manager (director) has not been appointed (elected) in such undertaking, and his or her object of mandatory contributions is his or her own selected amount, which is not less than the minimum wage stipulated by the Cabinet;

2) a manager (director) of an individual undertaking appointed (elected) in accordance with the procedures prescribed by law, who not being in employment legal relationships with such an undertaking, performs the management function of such an undertaking, and his or her object of mandatory contributions is his or her determined remuneration, but if a remuneration is not determined - his or her own selected amount, which is not less than the minimum wage stipulated by the Cabinet.

[27 October 2005]

35. If the persons referred to in Paragraph 34 of these Transitional Provisions have not determined for themselves an object of mandatory contributions or it is less than the amount of the minimum wage stipulated by the Cabinet and there is no supporting document, which certifies thereto, the tax administration shall recover from the employer the mandatory contributions and fines in the amount of three times the mandatory contribution from the amount that conforms to the amount of the minimum wage stipulated by the Cabinet.

[27 October 2005]

36. Amendments to Section 5, Section 6, Paragraph four and Section 19 of this Law in relation to persons, who receive a care for a disabled child benefit shall come into force on 1 January 2006.

[27 October 2005]

37. Amendments to the introductory part of Section 1, Clause 3 and Section 14, Paragraph two regarding the payers of a fixed income tax as well as to Section 6, Paragraph 3.1 shall come into force on 1 September 2008. Self-employed persons who pay the fixed income tax from 2008 and who have not made mandatory contributions from 1 January 2008 to 31 August 2008, shall have the right of choosing to make mandatory contributions for this period. Mandatory contributions for the period starting from 1 January 2008 until 31 August 2008 shall be made until 15 October 2008 and a late charge shall be applied to them.

[19 June 2008]

38. Amendments to Section 5, Paragraph one, Section 6, Paragraphs four and five of this Law in relation to subjection of persons to pension insurance and unemployment insurance who receive paternity benefit shall come into force on 1 January 2009.

[19 June 2008]

39. Section 6, Paragraph 5.1 of this Law and amendments to Section 19 in relation to subjection of persons to disability insurance who receive maternity or paternity benefit, or who take care of a child who has not reached one and a half years of age and receive an allowance for child care, or who take care of a child who has not reached the age of one year and receive parenting benefit shall come into force on 1 January 2009.

[19 June 2008]

40. Amendments to Section 6, Paragraphs two and nine, Section 20, Paragraph three, Clause 2, Paragraph four, Clause 2 and Paragraph seven, Clause 3 of this Law in relation to disability - subjection of the recipient of the State special pension to the types of social insurance - shall come into force on 1 January 2009.

[19 June 2008]

41. Amendments to Section 13, Paragraph two of this Law shall come into force on 1 January 2009.

[19 June 2008]

42. Amendments to Section 14, Paragraph seven of this Law in relation to the contributions made by the employer in private pension funds in favour of the employee not to be included in the object of mandatory contributions in conformity with pension schemes and paid in insurance premium sums shall come into force on 1 January 2009.

[19 June 2008]

43. The restriction of the maximum amount of the object of mandatory and voluntary contributions (the rights to determine the maximum amount of the object that are delegated to the Cabinet) provided for in Section 14, Paragraphs five and six of this Law shall not be applied within the time period from 1 January 2009 until 31 December 2013.

[19 June 2008]

44. Persons to whom within the time period from 1 January 1996 until 13 March 2001 (inclusive) the granting of an unemployment benefit was rejected due to the fact that the employer had not made mandatory contributions (social tax) starting with 1 January 2009, a time period up to nine months, in which the unemployment benefit was not paid out to the person and during which he or she has not been in the status of a socially insured person, shall be included in pension insurance. In such case the object of mandatory contributions (social tax) shall be the minimum wage in the relevant time period stipulated by the Cabinet.

[19 June 2008]

45. Section 20.1 of this Law shall come into force on 1 January 2009.

[19 June 2008]

46. Amendments in Section 3, Paragraph one of this Law in respect of the replacement of words "the contraction of an occupational disease, as well as additional expenditures in connection with the nursing of a child and" with "the contraction of an occupational disease, nursing of a child of the socially insured person, as well as additional expenditures in connection with" shall come into force on 3 May 2010.

[16 June 2009]

47. [20 December 2010].

48. Persons, who until 1 September 2010 have performed mandatory contributions from the payments determined in Section 14, Paragraph 2.1 of this Law, have the right to choose not to make mandatory contributions for a time period from 1 January 2010 until 31 August.

[9 August 2010]

49. The Cabinet shall assess the impact of mandatory contributions for pension insurance actually made and laid down in Section 5, Paragraph four of this Law on the social security of persons and every year until 1 October shall submit a report thereon to the Saeima.

[20 December 2010; 12 March 2015]

50. From 1 January 2012 until 31 December 2014 mandatory contributions for pension insurance intended from the State basic budget regarding persons who are performing temporary paid social work shall be made from the funds from European Union policy instruments.

[15 December 2011; 20 December 2012; 13 March 2014]

51. Amendments to Section 13, Paragraph five of this Law in relation to the right of the State Revenue Service to register losing the status of a socially insured person for a person (employee), as well as amendments regarding rewording of Section 20.1 of this Law and amendments to Section 23, Paragraph 1.1 regarding updating the amount of income for work and mandatory contributions shall come into force on 1 March 2013.

[20 December 2012]

52. Section 26.1, Paragraph three of this Law shall come into force on 1 June 2015.

[12 March 2015]

53. The State Insurance Agency shall calculate the mandatory contribution object of a full calendar month for the period up to 31 December 2016 in accordance with the calculated amount of mandatory contributions of each micro-enterprise employee (except for cases when an employee of the micro-enterprise -paying micro-enterprise tax starts or terminates employment at the micro-enterprise) in proportion to the number of employees indicated each month in the tax return of the micro-enterprise and their actual income, applying to them the mandatory contribution rate fixed for the respective employee who has been insured for all types of social insurance and who has reached the age which gives him or her the right to receive a State old-age pension or whom an old-age pension (including before term) has been granted and for an employee who is a recipient of a service pension or a person with disabilities - recipient of a State special pension. The calculated mandatory contribution object shall be rounded to the euro and cents, dropping 0.49 cents and less and rounding 0.50 cents and more to the cent.

[30 November 2015]

54. [20 December 2016]

55. [20 December 2016]

56. [20 December 2016]

57. Section 6, Paragraph 2.3 of this Law, amendment to Section 14, Paragraph two of this Law regarding deleting the second sentence, amendment regarding the rewording of Section 18, Paragraph two and Section 20.1, Paragraph six shall come into force on 1 January 2017.

[22 September 2016]

58. Section 21.1, Paragraph 1.1 of this Law, amendment regarding the rewording of Section 21.1, Paragraph three and Section 27.1, Paragraph three shall come into force on 1 January 2018.

[22 September 2016 / Section 21.1, Paragraph 1.1and the new wording of Paragraph three shall be included in the new wording of this Law by 1 January 2018.]

59. Pursuant to Section 21.1, Paragraph five of this Law the Agency shall write off the mandatory contribution margin resulting from rounding up the contributions for the previous period from the day the margin originated until 31 December 2015 but not more than one euro per calendar year for one socially insured person.

[22 September 2016]

60. From 1 January 2018, the Agency shall, within three years, inform the State Revenue Service about the overpaid contributions of an employer and a socially insured person which have been accrued by 31 December 2016 and the amount of which reaches or exceeds 35 per cent of the State social insurance benefit and the overpayment shall be refunded in accordance with the procedures provided for by the Cabinet.

[22 September 2016]

61. An employer who has started to reimburse his or her former worker (employee) the costs for the restrictions on competition by 31 December 2016 and continues to reimburse them after 1 January 2017, shall not provide information on acquiring the status of the employee in the reimbursement period and in the reports on mandatory contributions shall indicate the reimbursement for the restriction on competition in the period in which the respective person had the status of an employee.

[22 September 2016]

62. Section 13, Paragraphs six and seven and Section 23, Paragraph 1.4 of this Law shall come into force on 1 July 2017.

[23 November 2016]

63. By 1 May 2017, the Cabinet shall draw up draft laws on amendments regarding the amount of a social insurance service for socially insured persons having a low mandatory contribution object and submit to the Saeima.

[20 December 2016]

Informative Reference to European Union Directives

[20 December 2010; 20 December 2012; 13 March 2014; 22 September 2016]

This Law contains legal norms arising from:

1) [20 December 2012];

2) Directive 2009/52/EC of the European Parliament and of the Council of 18 June 2009 providing for minimum standards on sanctions and measures against employers of illegally staying third-country nationals;

3) Directive 2010/41/EU of the European Parliament and of the Council of 7 July 2010 on the application of the principle of equal treatment between men and women engaged in an activity in a self-employed capacity and repealing Council Directive 86/613/EEC;

4) Directive 2011/98/EU of the European Parliament and of the Council of 13 December 2011 on a single application procedure for a single permit for third-country nationals to reside and work in the territory of a Member State and on a common set of rights for third-country workers legally residing in a Member State;

5) Directive 2014/36/EU of the European Parliament and of the Council of 26 February 2014 on the conditions of entry and stay of third-country nationals for the purpose of employment as seasonal workers;

6) Directive 2014/66/EU of the European Parliament and of the Council of 15 May 2014 on the conditions of entry and residence of third-country nationals in the framework of an intra-corporate transfer.

This Law shall come into force on 1 January 1998.

The Law has been adopted by the Saeima on 1 October 1997.

For the President,
Deputy Chairperson of the Saeima A. Ameriks

Rīga, 21 October 1997

 


1 The Parliament of the Republic of Latvia

Translation © 2017 Valsts valodas centrs (State Language Centre)

 
Document information
Status:
In force
in force
Issuer: Saeima Type: law Adoption: 01.10.1997.Entry into force: 01.01.1998.Theme:  Insurance, Social protectionPublication: "Latvijas Vēstnesis", 274/276 (989/991), 21.10.1997., "Ziņotājs", 22, 27.11.1997.
Language:
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