Liability of the tax administrator

 

Administrative liability

Taxpayers, third persons and/or the management and other responsible staff of a legal person non-fulfilling or improperly fulfilling duties under the Law on Tax Administration of the Republic of Lithuania shall be held liable in accordance with the  Code of Administrative Offences of the Republic of Lithuania or Criminal Code of the Republic of Lithuania.

Legal information

Article 143 of the Law on Tax Administration of the Republic of Lithuania.

Code of Administrative Offences of the Republic of Lithuania

Code of Administrative Offences of the Republic of Lithuania grants the right to the tax administrator to complete protocols of administrative offences to a natural person having committed the offence.

Exemption from late payment interest

A taxpayer (withholding agent, hereinafter - the taxpayer) may be exempted from penalties and/or late payment interest during the approval of calculation, declaration and payment correctness inspection results or a tax dispute.

Pursuant to Articles 100 and 141 of the Law on Tax Administration, the tax administrator shall have the right to exempt the taxpayer solely from unpaid and unrecovered penalties and late payment interest.

LEGAL INFORMATION

Articles 100 and 141 of the Law on Tax Administration of the Republic of Lithuania.

Order No. VA-144 of the Chief of the State Tax Inspectorate under the Ministry of Finance of 26 July 2004 "On the Approval of the Rules for the Exemption from Penalties and Late Payment Interest" (version of Order No. VA-89 of the Chief of the State Tax Inspectorate under the Ministry of Finance of 1 October 2012).

Penalties

Article 139 of the Law on Tax Administration establishes that a taxpayer (withholding agent, hereinafter - the taxpayer) shall be imposed an economic sanction (penalty), if during an inspection the tax administrator determines that the taxpayer failed to calculate a tax not subject to declaration or failed to declare a tax subject to declaration, or illegitimately applied a lower tax tariff, and illegitimately reduced the tax payable for these reasons. The amount of tax underpayment shall be calculated in respect of the taxpayer and a penalty equal to 10-50% of the said amount shall be imposed, unless the relevant tax law provides for otherwise.

Penalties for violations of tax laws shall be imposed in accordance with legislation effective at the time when the violation was committed, except for the cases specified in Article 142 of the Law on Tax Administration.

 

Legal act

Penalty amount

Article 139 of the Law on Tax Administration

10-50% of tax underpayment

Article 123 of the Law on Value Added Tax

From 10 to 50% of the calculated VAT amount.

Article 16 of the Law on State Social Insurance

A penalty of 50% of the missing amount of reduced contribution amount

 

LEGAL INFORMATION

Articles 139, 140 and 142 of the Law on Tax Administration of the Republic of Lithuania

Article 123 of the Law on Value Added Tax of the Republic of Lithuania

Article 16 of the Law on State Social Insurance of the Republic of Lithuania

Order No. VA-25 of the Chief of the State Tax Inspectorate under the Ministry of Finance of the Republic of Lithuania of 28-03-2007 "On the Approval of the Methodology for Imposing Penalties and Calculating Late Payment Interest".

Criminal liability

Taxpayers, third persons and/or the management and other responsible staff of a legal person non-fulfilling or improperly fulfilling duties under the Law on Tax Administration of the Republic of Lithuania shall be held liable in accordance with the  Code of Administrative Offences of the Republic of Lithuania or Criminal Code of the Republic of Lithuania.

Legislation

Article 143 of the Law on Tax Administration of the Republic of Lithuania

Criminal Code of the Republic of Lithuania

Pursuant to Article 127 of the Law on Tax Administration, where the tax administrator, in the course of a tax inspection, establishes any acts having signs of a crime or any other offence, he shall inform the relevant law enforcement authorities thereof.

The following acts having signs of a crime or any other criminal offence are most usually established in the course of a tax inspection:

Crimes and criminal offenses against property, property rights and property interests

Article 182. Swindling.

Crimes and criminal offenses against economy and business order

Article 202. Unauthorised engagement in economic, commercial, financial or professional activities.

Article 203. Unlawful activities of a legal entity.

Article 209. Criminal bankruptcy.

Crimes and criminal offenses against financial system

Article 219. Failure to pay taxes.

Article 220. Provision of inaccurate data on income, profit or assets.

Article 221. Failure to file a tax return.

Article 222. Fraudulent management of accounts.

Article 223. Negligent management of accounts.

Crimes and criminal offenses against government order relating to forgery of documents or measuring devices

Article 300. Forgery of a document or the use or sale of a forged document.

Late payment interest

Article 96 of the Law on Tax Administration establishes that late payment interest shall be calculated in respect of the taxpayer:

  1. for taxes declared by the taxpayer but not paid or not paid on time to the budget, or for taxes calculated by the taxpayer (in cases specified in the relevant tax law, by the tax administrator) but not subject to declaration;
  2. for taxes subject to declaration but not declared and not paid, or not paid on time as determined by the tax administrator in the course of a tax inspection, or for non-calculated taxes not subject to declaration;
  3. for a tax overpayment refunded (credited) without due grounds at the request of the taxpayer (except for the cases where an undue tax overpayment is refunded (credited) in error by the tax administrator).

Pursuant to Article 99 of the Law on Tax Administration, the amount of late payment interest and the procedure of its calculation shall be established by the Minister of Finance, taking into account the weighted average of the annual interest rate for the Treasury bills of the Republic of Lithuania, issued in litas by auction in the previous quarter. The amount of late payment interest shall be established by increasing the said interest rate by 10 percentage points.

Late payment interest amounts in 2011-2016

LEGAL INFORMATION

Article 96, 97, 98 and 99 of the Law on Tax Administration of the Republic of Lithuania

Order No. VA-25 of the Chief of the State Tax Inspectorate under the Ministry of Finance of the Republic of Lithuania of 28-03-2007 "On the Approval of the Methodology for Imposing Penalties and Calculating Late Payment Interest".