Lithuania

On 10 August 2026, the VMI amended and supplemented the consolidated commentary on multiple subparagraphs of Article 2 of the Corporate Income Tax Law (paragraphs 41, 42, 7, 29, 38, 41). These definitions are foundational for determining taxable income, deductible expenses, and the scope of participation exemption. The update reflects 2025 legislative amendments and judicial […]

On 10 August 2026, the VMI updated the consolidated commentary on Article 55 of the Corporate Income Tax Law, which governs the tax treatment of liquidation, reorganization, and merger transactions. The amendment incorporates the 2025 changes to the tax-neutral merger regime and clarifies the carryover of tax attributes such as tax losses and unused investment

On 10 August 2026, the VMI revised the consolidated commentary on Article 40(3) of the Corporate Income Tax Law, which regulates the thin capitalization and interest deduction limitation rules (aligned with ATAD Article 4). The update provides detailed calculation methodologies for the EBITDA-based interest capacity and the treatment of excess borrowing costs. Key Takeaways EBITDA

On 10 August 2026, the Lithuanian Tax Authority published amendments to provisions 4 and 39 of the Tax Code, accompanied by an explanatory commentary that clarifies the taxable income definition for corporate entities. These amendments aim to eliminate ambiguities in profit calculation and specify procedural steps for filing adjusted tax returns. Effective: 1 September 2026.

On 10 August 2026, VMI issued an amendment to provision 55 of the Tax Code, updating the commentary on targeted tax relief measures. The revision aligns Lithuanian tax incentives with European Union standards, modifies eligibility criteria for deductions, and clarifies the scope of allowable expenses for both corporate and individual taxpayers. Effective: 1 September 2026.

On 10 August 2026, VMI released an explanatory commentary for provision 40(3) of the Tax Code, detailing the revised interpretation of specific tax obligations. This clarification impacts how certain taxes are assessed and aims to prevent disputes between taxpayers and the authority. Effective: 1 September 2026. Key Takeaways Interpretative scope: Defines taxable activities for provision

Lithuania amended the commentary to Corporate Profit Tax Law articles 4(2) and 39 on August 10, 2026, aiming to clarify transfer pricing documentation and permanent establishment criteria for multinational entities. The revision supports enhanced administrative cooperation within the EU. Key Takeaways Transfer Pricing Clarity: Detailed documentation requirements for intra-group transactions exceeding 500,000 euros. Permanent Establishment

Lithuania updated the commentary to Corporate Profit Tax Law articles 2(41,42,7,29,38,41) on August 10, 2026, focusing on tax base adjustments, anti-abuse rules, and reporting obligations for large taxpayers. The revision aims to reduce compliance gaps and improve audit efficiency. Key Takeaways Tax Base Adjustments: New rules specifying add-backs for certain cross-border payments and intangible asset

Lithuania revised the commentary to Corporate Profit Tax Law article 55 on August 10, 2026, addressing the calculation of tax losses carried forward and the treatment of restructuring expenses. The change provides clearer guidance for corporate restructuring and merger & acquisition transactions. Key Takeaways Loss Carry-Forward Rules: Clarified maximum carry-forward period of five years and

On 18 June 2026, the Lithuanian Parliament adopted amendments to the VAT Law (No. IX-751) affecting Articles 4-1, 4-2, 4-3, 5-1, 12, 12-2, 13-2, 78, 88-1, 115-1, 115-6, 115-11 and Annex 2. The VMI announced the changes on 7 August 2026. Notably, Article 4-2 (special scheme for small enterprises) has been repealed effective 1 January