Latvia Inheritance and Gift Tax Guide 2026

Overview — Inheritance and Gift Taxation in Latvia

Latvia does not have a separate inheritance tax (mantojuma nodoklis) or gift tax (dāvinājuma nodoklis) as found in many other European countries. Instead, inherited and gifted assets are treated as income of the recipient and may be subject to personal income tax (IIT) at the standard 20% rate. However, the system includes broad exemptions for close family members that effectively eliminate taxation for most inheritance and gift situations. The system is relatively simple compared to countries with complex estate tax regimes.

Inheritance — 0% for Spouses and Direct Descendants

Inherited assets are subject to IIT as follows:

• Spouses: Inheritances received by a surviving spouse are fully exempt from tax.
• Direct descendants: Children, grandchildren, and further descendants are fully exempt from tax on inheritances.
• Direct ascendants: Parents, grandparents, and further ancestors are fully exempt from tax on inheritances.
• Other beneficiaries: Siblings, nieces, nephews, friends, and non-relatives are subject to 20% IIT on the inherited value exceeding EUR 10,000.

Gifts — 0% for Direct Line

Gifts are treated similarly to inheritances:

• Spouses: Gifts between spouses are fully exempt from tax.
• Direct line (parents, children, grandchildren): Gifts between direct ascendants and descendants are fully exempt.
• Other beneficiaries: Gifts to other individuals are subject to 20% IIT on the value exceeding EUR 10,000 per year from a single donor.
• Annual threshold: Gifts below EUR 10,000 per year per donor to non-exempt beneficiaries are not taxable.

Valuation of Inherited/Gifted Assets

• Real estate: Valued at cadastral value (for property) or market value at the date of inheritance/gift
• Cash and bank deposits: The face value of the cash or deposit amount
• Securities and shares: Market value at the date of transfer
• Personal property: Fair market value (jewellery, vehicles, art, etc.)

Filing Requirements

• Exempt beneficiaries: No filing requirement for inheritances and gifts received from exempt persons (spouses, direct line).
• Taxable beneficiaries: Must declare the inheritance or gift on the annual IIT return (by 1 June) and pay 20% on the value exceeding EUR 10,000.
• Inheritance registration: Inherited real estate must be registered with the Land Registry (Zemesgrāmata) regardless of tax status.

No Estate or Wealth Transfer Tax

Latvia does not impose any of the following taxes:

• No estate tax: Latvia does not tax the estate of the deceased person. The estate itself is not subject to tax.
• No inheritance tax: There is no separate inheritance tax. Inherited assets are treated as income of the beneficiary.
• No gift tax: There is no separate gift tax. Gifts are treated as income of the recipient, with broad exemptions.
• No wealth tax: Latvia does not impose an annual wealth tax on personal assets.

Cross-Border Inheritance and Gifts

• Non-residents inheriting Latvia assets: Non-residents who inherit Latvia-situs assets (real estate, Latvia company shares) are subject to the same rules — exempt for spouses and direct line, 20% for others.
• Residents inheriting foreign assets: Latvia residents who inherit foreign assets may be subject to Latvia IIT on the value. Foreign inheritance tax paid may be credited under DTT or unilateral credit rules.
• DTTs for inheritance: Some of Latvia's double tax treaties include provisions on inheritance taxes (estate, inheritance, and gift taxes). Where applicable, treaty provisions may override domestic rules.

FAQs

Is there really no inheritance tax in Latvia?

Latvia does not have a dedicated inheritance tax. Inherited assets are treated as income of the beneficiary under the IIT system. However, inheritances received by spouses and direct descendants are fully exempt from this income tax, meaning most family inheritances are effectively tax-free.

Do I need to report a gift from my parents?

No, gifts from parents to children (and vice versa) are fully exempt from tax. There is no reporting requirement for exempt gifts. Only gifts to non-exempt persons exceeding EUR 10,000 per year must be declared.

What about inherited real estate from a non-relative?

If you inherit real estate from a non-relative (e.g., a friend), the cadastral value of the property is subject to 20% IIT. The first EUR 10,000 is exempt. If the cadastral value is EUR 100,000, tax would be 20% × (EUR 100,000 − EUR 10,000) = EUR 18,000.

Disclaimer

This guide provides general information about Latvia inheritance and gift taxation for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Latvian tax advisor (nodokļu konsultants) or VID directly for advice specific to your situation. InvestmentKit does not provide tax advice.