On January 1, 2010, amendments to the law “On personal income tax” came into force.

Starting from January 1, 2010, NORVIK BANKA will automatically withhold the 10% income tax from the dividends and interest on deposits (term deposits, savings accounts, settlement accounts) paid to customers (individuals - both residents and non-residents), and transfer the tax to the state budget.

Tax from the interest on deposits and disbursement of dividends will be withheld at the moment of pay-out of the income.

At the same time we would like to remind You, that the 10% income tax is withheld only from the interest income, rather than from the whole deposit amount. For example, if the client has placed a deposit in NORVIK BANKA for the amount of 1000 LVL at the annual interest rate of 10.75%, and pay-out at the end of deposit term, then, at the end of deposit term, the interest income will be calculated as follows:

Accumulated interest income 107.50 LVL
“Minus” personal income tax 10% of 107.50 LVL= 10.75 LVL
After-tax income 107.50 LVL – 10.75 LVL = 96.75 LVL

However, the 15% capital gains tax from the income of realization of capital assets (bonds of other issuers, fund shares and other securities, real estate, intellectual property, parts of the business) customer must calculate and transfer to the state budget by himself.

This message is for information purposes only. Complete information about amendments to the law "On personal income tax" you should ask to your tax adviser or look in www.likumi.lv (in Latvian).