What Global Companies Need to Know About Lithuania Payroll

Companies looking to expand will find Lithuania to be a promising country for their business. It was recently ranked 16th on the "Ease of Doing Business" ranking from the World Bank Group.

It is fairly easy to get your company registered here, and the majority of the work can be done online. Companies will need an in-country bank account, which generally takes only about a day to complete (providing you have the appropriate capital to get started.) You will need to visit the Centre of Registers for an electronic signature and the Register of Legal Entities to reserve your company name. Companies may be asked to show the partnership or incorporation agreement, the deed of incorporation, or the articles of association as a means of legitimizing the business.

Registration for payroll purposes

Nowadays it is common practice when a foreign legal entity employs a Lithuanian resident, whose working place is Lithuania. Usually the foreign legal entity does not wish to have any legal establishment in the country (e.g. limited liability company, branch or other).

In case there are no obligations to register a permanent establishment due to the performed functions of the employed resident, the foreign entity shall be registered as a Tax Payer in Lithuania and pay social security contributions to Lithuanian budget.

The main documents required for the registration:

- employment contract;

- copy of the passport or ID card of the employee;

- copy of the passport or ID card of the Head of the Entity;

- extract from the Commercial Register.

What kind of information is required:

- Information on the Head of the Entity (e.g. address, email address, phone number)

- Information on the Accountant

Registration the Tax payer takes approximately 3-5 working days.