The handbook is designed to find out the basic requirements and permits for public catering.

Permits required to start a business

Description of procedures for assessing compliance of catering enterprises with hygiene requirements (in Lithuanian)

Approval Certificate of Food Business Operator

Approval of a food business operator refers to the entitlement of a food business operator to engage in sprout production activity, its inclusion in the List of Food Business Operators managed by the State Food and Veterinary Service and assigning of an identification number.

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Company self-control system

Food business operators must apply an individual system of risk analysis and critical control points (RACCP) or voluntarily use sectoral rules of good hygiene practice (GHP).

Food business operators can voluntarily choose the option of implementing a self-monitoring system that is acceptable to them: the RACCP system or the implementation of GHP rules.

GHP rules are intended for small and medium-sized food handling entities, help entrepreneurs to assess and analyze the general, essential food safety requirements of their business, ensuring the risk assessment of food products, the implementation of safety requirements.

Read more (in Lithuanian)

HN 15:2005 “Food hygiene”

Read more (in Lithuanian)

Waste Management Rules

The rules establish the procedure for waste management, accounting, declaration, sorting, and labeling.

Read more

A license to engage in retail trade in alcoholic beverages

Read more

A license to engage in retail trade of tobacco products

Read more

If you plan to hang an outdoor advertisement or a signboard with your place’s name, you will need to match this sign with the local municipality and obtain an external advertising permit. The cost of the permit will depend on the size and location of the sign. For more detailed information on issuing a permit, please contact the specific municipality where you plan to operate.

Read more

Business forms and fees

Here you will find information about applicable taxes by business forms. Abbreviations used:

  • VSD – state social insurance contribution
  • PSD – Compulsory Health Insurance Fee
  • GPM – Personal Income Tax
  • VAT – value added tax
  • PM – profit tax
  • NPD – non-taxable income
  • PNPD is an additional NPD
  • MMA – the minimum monthly salary

Details of business forms and fees are available here

UAB
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.
  5. Taxes of the workplace:
    • Personal income tax – 20 % (if the income doesn’t exceed 84 average wages, which are EUR 104,278 per year, 32 % (if the income does exceed 84 average wages).
    • Unemployment Social Insurance – 1,31 % (employment contract with indefinite duration). Fixed-term employment contract – 2,03 %.
    • Social insurance against accidents at work and occupational diseases – 0,14 -1,40 %.
    • State social insurance – 8,72 % (additional pension contribution 2,1 % or 3,0 %).
    • Compulsory health insurance – 6,98 %.
    • Sickness Social Security – 2,09%
    • Maternity Social Security – 1,71%
    • Contribution to the long-term employment fund – 0,16 %

Find out more about the establishment, comparison, and comparison with other business forms here.

Small partnership
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.

Personal withdrawals by Small Partnership member:

  • Personal income tax – 20 % of the number of funds withdrawn for personal needs.
  • State social insurance contributions are paid from 50 % of the number of funds withdrawn for personal needs.

State social insurance contribution rates:

  • 13,83 %;
  • 15,93 % if a partner of small partnership participates in the supplementary accumulation of pensions (2,1 %);
  • 16,83 % if a partner of small partnership participates in the supplementary accumulation of pensions (3,0 %);
  • Compulsory health insurance – 6,98 % from 50 % of the number of funds

withdrawn for personal needs.

The income of the small partnership manager, who is also a small partnership member:

  • Personal income tax – 15 %.
  • Pension insurance tax and compulsory health insurance tax do not need to pay.

The income of a non-small partnership member for the manager services:

  • Personal income tax – 20 %.
  • The state social insurance contributions for the heads of small partnerships, which are not partners of these small partnerships according to the Law on Small Partnerships, are paid to the pension social insurance under the same procedure as they are paid for persons who have an employment relationship or another type of relationship equivalent to employment at the following rate:
  • 15,70 % (8,72 % for the pension insurance, 6,98 % for the health insurance);
  • 17,80 % if the pension is accumulated voluntarily 2,1 % (8,72 % for the pension insurance, 6,98 % for the health insurance, 2,1 % additional pension contribution).
  • 18,70 % if the pension is accumulated voluntarily 3,0 % (8,72 % for the pension insurance, 6,98 % for the health insurance, 3,0 % additional pension contribution).

More about MB, its establishment and comparison with other business forms can be found here.

Individual enterprise
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.

Personal withdrawals by Individual Enterprise owner:

  • Personal income tax – 20 % of the number of funds withdrawn for personal needs.
  • State social insurance contributions are paid from 50 % of the number of funds withdrawn for personal needs.

State social insurance contribution rates:

  • 13,83 %;
  • 15,93 % if a partner of small partnership participates in the supplementary accumulation of pensions (2,1 %);
  • 16,83 % if a partner of small partnership participates in the supplementary accumulation of pensions (3,0 %);
  • Compulsory health insurance – 6,98 % from 50 % of the number of funds withdrawn for personal needs.

More about Individual company, its establishment, and comparison with other business forms can be found here.

Individual activity by certificate

Personal income tax

  • The personal income tax (gyventojų pajamų mokestis or GPM in Lithuanian)
  • 5%-15% tax is applied for persons performing individual activities. Non-residents are taxed at the same rate as residents (for income obtained in Lithuania).

Compulsory health insurance 

  • Mandatory health insurance (Privalomasis sveikatos draudimas or PSD in Lithuanian) gives access to free health insurance services (to the majority of them). If the person is not insured with PSD s/he has to pay for medical services.
  • The Compulsory health insurance (PSD) size is 6,98 percent. It is calculated from the income, from which the social insurance contributions are calculated from, meaning – 90 percent of taxable income (without deducting VSD and PSD payables).

Social security tax

  • The main goal of the state social security system is to guarantee income for the insured when they are not able to work due to sickness, maternity, age, disability or other reasons. The social security tax has to be paid also by self-employed persons, athletes, artists, and others.
  • The contributions (payables) to “Sodra” are paid from the 90 percent of the taxable income from the individual economic activity (without deduction of State social insurance (VSD) and Compulsory health insurance (PSD).

VSD contributions rate:

  • 12,52 percent.
  • 14,62 percent if the person saves for a supplementary pension (2,1 percent);
  • 15,52 percent if the person saves for a supplementary pension (3 percent).

Value-added tax (VAT)

VAT is a general, broadly based consumption tax assessed on the value added to goods and services. It applies more or less to all goods and services that are bought and sold for use or consumption. It is a tax paid by consumers. The standard VAT rate in Lithuania is 21 %. The reduced VAT rates are as follows: 0%, 5 %, and 9%.

More information on the individual activity certificate, its registration, and comparison with the business certificate can be found here.

Accounting

To provide accurate information about the entity’s financial position, performance and cash flows, the required financial statements. The financial statements comprise the following financial statements:

  • balance;
  • profit and loss statement;
  • cash flow statement;
  • statement of changes in equity;
  • explanatory note.

For more information on tax administration, please contact the State Tax Inspectorate’s departments www.vmi.lt, e-mail: vmi@vmi.lt, +370 5 266 8200; 8 5 255 3190.

Accounting Requirements for Individual Enterprise

In conducting your business, you must keep records in accordance with the requirements for the management of accounting of legal entities of unlimited civil liability. The accounting can be managed by the owner of the company, an accountant, a contract accounting company, or a self-employed accounting service.

Law on Accounting. Read more.
Business Accounting Standards. Read more.
Law on the Financial Reporting of Enterprises. Read more.
On Approval of Inventory Rules. Read more.
On the approval of the work of the Cashier and the execution of cash transactions. Read more.

Accounting requirements for AB, MB and UAB

In conducting your business, you must keep records in accordance with the requirements for the management of the accounting of limited liability of legal entities. The accounting can be managed by the entity’s structural unit or a chief accountant (accountant) and a contractual accounting service provider.

Law on Accounting. Read more.
Business Accounting Standards. Read more.
Law on the Financial Reporting of Enterprises. Read more.
On Approval of Inventory Rules. Read more.
On the approval of the work of the Cashier and the execution of cash transactions. Read more.

Accounting management with customised activity statement

If a person who has a certificate of individual activities are not subject to VAT, and then records are managed in accordance with the cash accounting principle, i.e., the revenue is recognised at the time of their receipt. If the person who has to individual activities under the memo is a VAT taxpayer, accounting is managed in accordance with the principle of accrual accounting, i.e. the (revenue is recognised when it is earned, regardless of receipt of revenue). A resident of applying the cash accounting principle and applying the accrual accounting principle must complete individual revenue and expenditure activities of the journal.

For more information: Individual activities under the memo, the accounting records and the requirements of filing the certificate of individual activity, in accordance with the accounting rules, the Republic of Lithuania approved by order of the Minister of finance

Accounting management with a business license
Acquiring business certificates that use cash registers to account for operating income, the operating income and expenses are specified in the cash register transaction log of the form and order of completion . 
Cash registers and their prices

Suitable cash registers that are included in the Tax Authorities in the list of authorized cash registers and sales (service provision) vending machines in the Republic of Lithuania are available from companies trading there. A list of suitable cash registers (suitable cash registers are devices that are in compliance with the technical requirements and included in the VMI list; the cash registers not listed or already excluded from the cash register are not usable), and the names of the companies that sell them are published by the STI on their website. You can buy a cash register with a new one, used or leased from cash registers.

Cash registers and their prices:

  • New from 144 Eur
  • Used from 30 Eur
  • Rent for months from 70 Eur

Cash registers are required to be trained to work on the cash register (including the completion of a technical passport and registration of the cash registers in the territorial State Tax Inspectorate and the proper programming thereof) and its users to work with the cash register. Most cash registers also offer their services. The said works are usually included in the sales price of the cash register. You can read more about cash registers on the VMI page.

Business forms and fees

Here you will find information about applicable taxes by business forms. Abbreviations used:

  • VSD – state social insurance contribution
  • PSD – Compulsory Health Insurance Fee
  • GPM – Personal Income Tax
  • VAT – value added tax
  • PM – profit tax
  • NPD – non-taxable income
  • PNPD is an additional NPD
  • MMA – the minimum monthly salary

Details of business forms and fees are available here

UAB
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.
  5. Taxes of the workplace:
    • Personal income tax – 20 % (if the income doesn’t exceed 84 average wages, which are EUR 104,278 per year, 32 % (if the income does exceed 84 average wages).
    • Unemployment Social Insurance – 1,31 % (employment contract with indefinite duration). Fixed-term employment contract – 2,03 %.
    • Social insurance against accidents at work and occupational diseases – 0,14 -1,40 %.
    • State social insurance – 8,72 % (additional pension contribution 2,1 % or 3,0 %).
    • Compulsory health insurance – 6,98 %.
    • Sickness Social Security – 2,09%
    • Maternity Social Security – 1,71%
    • Contribution to the long-term employment fund – 0,16 %

Find out more about the establishment, comparison, and comparison with other business forms here.

Small partnership
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.

Personal withdrawals by Small Partnership member:

  • Personal income tax – 20 % of the number of funds withdrawn for personal needs.
  • State social insurance contributions are paid from 50 % of the number of funds withdrawn for personal needs.

State social insurance contribution rates:

  • 13,83 %;
  • 15,93 % if a partner of small partnership participates in the supplementary accumulation of pensions (2,1 %);
  • 16,83 % if a partner of small partnership participates in the supplementary accumulation of pensions (3,0 %);
  • Compulsory health insurance – 6,98 % from 50 % of the number of funds

withdrawn for personal needs.

The income of the small partnership manager, who is also a small partnership member:

  • Personal income tax – 15 %.
  • Pension insurance tax and compulsory health insurance tax do not need to pay.

The income of a non-small partnership member for the manager services:

  • Personal income tax – 20 %.
  • The state social insurance contributions for the heads of small partnerships, which are not partners of these small partnerships according to the Law on Small Partnerships, are paid to the pension social insurance under the same procedure as they are paid for persons who have an employment relationship or another type of relationship equivalent to employment at the following rate:
  • 15,70 % (8,72 % for the pension insurance, 6,98 % for the health insurance);
  • 17,80 % if the pension is accumulated voluntarily 2,1 % (8,72 % for the pension insurance, 6,98 % for the health insurance, 2,1 % additional pension contribution).
  • 18,70 % if the pension is accumulated voluntarily 3,0 % (8,72 % for the pension insurance, 6,98 % for the health insurance, 3,0 % additional pension contribution).

More about MB, its establishment and comparison with other business forms can be found here.

Individual enterprise
  1. Corporate Income tax – 15 %. Taxable profits of entities whose average number of employees on the staff list does not exceed 10 and whose income during a tax period do not exceed EUR 300 000 shall be taxed at a rate of 0% during the first tax period, and at a rate of 5% during other tax periods, except for the cases specified in the law.
  2. The Standard Value added tax (VAT) rate is 21%. Taxable persons engaged in the provision of goods or services in Lithuania must register as VAT payers and calculate and pay VAT to the state budget. However, a taxable person of the Republic of Lithuania does not have to register as a VAT payer and does not have to calculate nor pay VAT on the goods and/or services supplied, provided that the aggregate amount received from the goods and/or services supplied as part of routine business activities does not exceed EUR 45,000 during the last 12 months. Registration as a VAT payer is not mandatory where the aggregate value of all goods purchased from the other EU Member States does not exceed EUR 14,000 (excluding VAT). There is an opportunity for voluntary registration as a VAT payer in cases where the aforesaid limit amounts are not exceeded.
  3. Real Estate Tax (if the legal entity has registered immovable property) – 0,30% – 3,00% (depends on immovable property value).
  4. Dividends and other income from distributed profits shall be taxed at a rate of 15 %.

Personal withdrawals by Individual Enterprise owner:

  • Personal income tax – 20 % of the number of funds withdrawn for personal needs.
  • State social insurance contributions are paid from 50 % of the number of funds withdrawn for personal needs.

State social insurance contribution rates:

  • 13,83 %;
  • 15,93 % if a partner of small partnership participates in the supplementary accumulation of pensions (2,1 %);
  • 16,83 % if a partner of small partnership participates in the supplementary accumulation of pensions (3,0 %);
  • Compulsory health insurance – 6,98 % from 50 % of the number of funds withdrawn for personal needs.

More about Individual company, its establishment, and comparison with other business forms can be found here.

Individual activity by certificate

Personal income tax

  • The personal income tax (gyventojų pajamų mokestis or GPM in Lithuanian)
  • 5%-15% tax is applied for persons performing individual activities. Non-residents are taxed at the same rate as residents (for income obtained in Lithuania).

Compulsory health insurance 

  • Mandatory health insurance (Privalomasis sveikatos draudimas or PSD in Lithuanian) gives access to free health insurance services (to the majority of them). If the person is not insured with PSD s/he has to pay for medical services.
  • The Compulsory health insurance (PSD) size is 6,98 percent. It is calculated from the income, from which the social insurance contributions are calculated from, meaning – 90 percent of taxable income (without deducting VSD and PSD payables).

Social security tax

  • The main goal of the state social security system is to guarantee income for the insured when they are not able to work due to sickness, maternity, age, disability or other reasons. The social security tax has to be paid also by self-employed persons, athletes, artists, and others.
  • The contributions (payables) to “Sodra” are paid from the 90 percent of the taxable income from the individual economic activity (without deduction of State social insurance (VSD) and Compulsory health insurance (PSD).

VSD contributions rate:

  • 12,52 percent.
  • 14,62 percent if the person saves for a supplementary pension (2,1 percent);
  • 15,52 percent if the person saves for a supplementary pension (3 percent).

Value-added tax (VAT)

VAT is a general, broadly based consumption tax assessed on the value added to goods and services. It applies more or less to all goods and services that are bought and sold for use or consumption. It is a tax paid by consumers. The standard VAT rate in Lithuania is 21 %. The reduced VAT rates are as follows: 0%, 5 %, and 9%.

More information on the individual activity certificate, its registration, and comparison with the business certificate can be found here.

Marketing

Marketing – A system of measures involving a product or service path from its idea to the user. Traditionally, marketing is considered to consist of four elements. This is the idea of ​​a product or service, its development, pricing, distribution, and the design and implementation of sales promotion actions. All four factors are important in marketing activities.

More information here.

Permits required to start a business

Business forms and fees

UAB

Small partnership

Individual enterprise

Individual activity by certificate

Accounting

Accounting Requirements for Individual Enterprise

Accounting requirements for AB, MB and UAB

Accounting management with customised activity statement

Accounting management with a business license

Cash registers and their prices

Business forms and fees

UAB

Small partnership

Individual enterprise

Individual activity by certificate

Marketing