Which interest received is exempt from income tax
Which interest received is exempt from income tax
Interest which is exempt from personal income tax regardless of the amount received:
- interest received from Lithuanian companies for non-equity securities, such as bonds (other than non-equity securities issued by persons linked to a resident through employment relations or the equivalent thereto, if persons linked to a resident through employment relations or the equivalent thereto pay the resident for these non-equity securities higher interest rates than other holders of the same non-equity securities), if these non-equity securities were acquired before 31 December 2013, and their redemption commenced not earlier than 366 days after the date of issue of these securities;
- interest on deposits held with Lithuanian commercial banks and other credit institutions contracted before 31 December 2013.
Interest exempt from personal income tax when the total amount thereof does not exceed EUR 500 per calendar year:
- interest received on deposits from Lithuanian commercial banks and other credit institutions, if the deposits are contracted after 1 January 2014, and interest received from Lithuanian companies (other than interest on government securities) for non-equity securities, such as bonds (other than non-equity securities issued by persons linked to a resident through employment relations or the equivalent thereto, if persons linked to a resident through employment relations or the equivalent thereto pay the resident for these non-equity securities higher interest rates than other holders of the same non-equity securities), if these non-equity securities were acquired after 1 January 2014.
Important: the tax credit of EUR 500 also applies to interest (if any) received in foreign countries on deposits contracted after 1 January 2014, and interest on non-equity securities acquired after 1 January 2014.
Interest exempt from personal income tax when the total amount thereof does not exceed EUR 500 per calendar year:
- interest on consumer credit granted through a peer-to-peer lending platform in accordance with the procedure laid down in Republic of Lithuania Law on Consumer Credit, and interest on funds granted through a crowdfunding platform in accordance with the procedure laid down in Republic of Lithuania Law on Crowdfunding.
Important: the tax credit of EUR 500 also applies to interest from foreign companies on consumer credit granted through a peer-to-peer lending platform, and/or interest on funds (if any) granted through a crowdfunding platform, if the credit/funds were granted in accordance with the laws of a Member State of the European Economic Area, analogous to Lithuania Law on Consumer Credit or Republic of Lithuania Law on Crowdfunding.
Please note that interest payers withhold income tax on the amount of interest paid from the first euro, without applying the tax credit of EUR 500. You can claim the tax credit of EUR 500 when submitting your tax return.