As of October 6, 2022, Industra Bank has introduced an economic activity revenue account (SDI account) for economic activity performers-microenterprise tax payers.
Using an SDI account, a self-employed person who is a payer of micro-enterprise tax (MUN) will no longer need to submit a MUN declaration, as well as calculate and transfer the amount of tax to be paid to the state budget. The client must credit all his economic activity revenues to this SDI account, and further actions will be carried out automatically by Industra Bank in cooperation with the SRS.
“As a bank formed by entrepreneurs, we know what the everyday life of business people is like and how much time and care it can take to deal with bureaucratic and administrative issues, which otherwise an entrepreneur could devote to developing his business. Economic operators are an essential element in the blood circulation of the Latvian economy, so I am pleased that in cooperation with the SRS and the Financial Industry Association, we have been the first in the industry to introduce an SDI account and we very much hope that it will be a good helper for small entrepreneurs and relieve their everyday life. On the other hand, the SDI account will provide the State Revenue Service with a simple and understandable tax administration process, allowing the use of SRS human resources in other for streamlining processes in order to make the business environment in Latvia truly business-friendly,” comments Industra Bank board member Uģis Vorons.
“The introduction of the economic activity revenue account is a highly anticipated event that can significantly ease the everyday life of many economic activity performers, regardless of the sector in which the economic activity performer operates. I know that many people working in the creative industries, who do not have this type of income on a regular basis, are also waiting for the introduction of this account , so it is not profitable for them to start companies or hire accountants. Open an account, work and be sure that you have settled your obligations with the state. It is also important to know that 80% of the taxes paid in this way are calculated as social contributions,” says the Finance advisor to the minister, music publisher and musician Guntars Račs.
“Joint work on the regulation and technical development of the SDI account has resulted in a solution that ensures automatic tax deduction for a self-employed person from his account, which significantly reduces the administrative burden. We are pleased with the initiative and support shown by Industra Bank, a member of the Financial Industry Association, in the implementation of such a solution, we very much hope that this solution will be the basis for further innovations in simpler tax collection”, emphasizes Sanita Bajāre, chairman of the board of the Financial Industry Association.
According to the current legal framework in Latvia, the SDI account can be used by economic operators who are micro-enterprise tax payers, but are not VAT payers, if they have no tax debts and are not employers of other employees. If the economic operator already has an account with Industra Bank, which he wants to use in the future as an SDI account, then he only needs to submit an SID EDS application for registering an SDI account, then the SID will contact the bank about the received application and inform the client when the account has been switched to SDI mode. The process will take approximately five working days from the moment the MUN payer’s application is received by the SRS EDS.
When choosing to use a pre-opened account, it is important to make sure that there are no credits attached to it and that it is not used to receive other payments not related to economic activity, because then tax amounts will also be reserved from these funds and transferred to SID according to the conditions of the SDI account.
