Course code Ekon2135

Credit points 3

Tax Accounting

Total Hours in Course120

Number of hours for lectures16

Number of hours for seminars and practical classes32

Independent study hours72

Date of course confirmation19.06.2019

Responsible UnitInstitute of Finance and Accounting

Course developer

author Finanšu un grāmatvedības institūts

Inguna Leibus

Dr. oec.

Prior knowledge

Ekon2079, Simple-entry Accounting

Ekon2081, Finance and Credit

Course abstract

The study course provides knowledge of the types of tax, the obligations, rights and liability of an undertaking as a taxpayer. During the course, students learn how to calculate taxes, declare and pay the taxes, cooperation arrangements between the company and the tax administration: the right of taxpayers to receive tax allowances and relief, to extend the tax period, to challenge the decisions of the tax administration, as well as the right of the tax administration to impose tax surcharges.

Learning outcomes and their assessment

1) Knows and understands tax calculation, payment and declaration procedure and related terms - independent work, tests
2) Knows and understands the duties and rights of a taxpayer - independent work, tests
3) Knowledge of different tax regimes - test work with calculations
4) Able to carry out tax calculations and preparation of corresponding tax returns - test work with calculations, independent work, presentation
5) Able to apply the tax legal base independently - independent work, presentation
6) Able to plan the tasks responsibly - independent work, presentation
7) Able to select information, present and justify calculations made, proposals made - individual work, presentation
8) Able to apply acquired theoretical and practical knowledge, to link theory with practice - practical work, independent work, tests, presentation
9) Able to make different tax calculations, apply different types of tax breaks and discounts - practical work, independent work, tests, presentation
10) Knows business tax relief - practical work, independent work, tests, presentation

11) Able to forecast tax payments for a newly established company - practical work, independent work, tests, presentation.

Course Content(Calendar)

1) Tax accounting legislation and its application. Laws of the Republic of Latvia and amendments thereto. Cabinet Regulations and amendments thereto. Annotations of legislative amendments. State Revenue Service (SRS) methodological materials. SRS information, requesting and using it. Databases available on the SRS home page and their use. Case law in tax matters. Tax consultations (2 lectures, 1 practical work)
2) Obligations of the company as a taxpayer. Registration procedure with the SRS. Registration of units. Changes in taxpayer details. General procedure for calculation, payment and declaration of taxes. Taxation period. Procedures for the use of strict accounting documents. Procedure for the use of transaction receipts. Declaration of cash transactions (2 lectures, 1 practical work)
3) The rights and responsibilities of the company as a taxpayer. Electronic declaration system. Tax payment deadlines and their extension. Correction of tax returns. Clarification of tax calculations. Recovery of amounts overpaid. Types of SRS inspections. Thematic tests. Tax audits. Tax debts and surcharges. Procedure for appealing and appealing of SRS decisions. Liability for Tax Offenses (1 lecture, 1 practical work)
4) Payroll tax accounting. Recording of workers' movements. Calculation and accounting of payroll tax. Non - taxable income and tax relief. Calculation and accounting of payroll tax benefits. Payroll tax declarations. Calculation of state social insurance contributions. Compulsory social security contributions for the employee and the employer. Payroll related tax and informational reports. Earnings equal to wages and salaries. Remuneration to members of the board of directors of commercial companies. Loans treated as income. Seasonal Farm Worker Income Tax (1 lecture, 3 practical works)
5) Calculation and accounting of state social insurance contributions. Compulsory socially insured persons and their insurance arrangements. Reports on State Social Insurance Contributions (1 lecture, 3 practical works, test)
6) Withholding of personal income tax from expenses to individuals. Object of personal income tax, rates and procedure for their application. Personal income tax calculation and tax reports. Eligibility rules and their application. Personal Income Tax Income and its Accounting (1 lecture, 2 practical works)
7) Micro-enterprise tax accounting. Micro-enterprise tax calculation and payment procedure. Micro-enterprise tax rates. Restrictions on micro-enterprises. Micro-enterprise tax return. Micro-enterprise tax distribution arrangements. State Social Insurance in Micro Enterprises (1 lecture, 1 practical work)
(8) Procedure for calculating and paying the company car tax. Object and amount of the tax. Taxpayers. Tax payment procedure. Exemptions. Lending and Hire Passenger Car Usage, Accounting Procedure and Tax Calculation (1 lecture, 2 practical works, test)
9) Value added tax (VAT) accounting. VAT registration. Possibility not to register for VAT. Accounting for VAT and non-taxable transactions. Place and time of the transaction. Application of different VAT rates. Exemptions. VAT invoice. VAT input tax accounting. Restrictions on input tax. Withholding tax adjustment on bad debts. Calculation and accounting of VAT. The right to deduct input tax on purchased goods, services received and imported goods prior to the person's registration with the State Revenue Service's VAT payer register. VAT treatment of transactions with EU Member State companies, import and export transactions. Special VAT arrangements. Special tax treatment. Payment of the reverse charge. VAT declaration. Arrangements for the recovery of VAT overpayments. Use of cash register principle. Exclusion from the VAT register. VAT Compensation for Agricultural Enterprises (1 lecture, 5 practical works)
10) Real estate tax calculation and payment procedure. Object and amount of the tax. Tax payment procedure. Exemptions. Company Responsibilities (1 lecture)
11) Procedure for Calculation and Payment of Natural Resources Tax. Object and amount of the tax. Tax payment procedure. Exemptions from tax and the possibilities to use them (1 lecture)
12) Procedure for calculation and payment of excise duty. Object and amount of the tax. Tax payment procedure. Exemptions. Tax reduction for agricultural businesses (1 lecture)
13) Corporate income tax accounting. Calculation of the tax base. Tax on estimated dividends. Non - operating expenses. Corporate income tax relief and rebates. Tax incentives for agricultural businesses. Corporate income tax return. Necessity and Procedure of Transfer Pricing Calculation (1 lecture, 3 practical works, 3rd test – 2 hours)
14) Taxation in the Annual Report. Information in the Balance Sheet, Income Statement, Cash Flow and Notes to the Annual Report (1 lecture).

15) Tax planning for a new company (presentation of independent work 6 hours).

Requirements for awarding credit points

At the end of the course the student receives a credit with a mark, which is a cumulative assessment of the learning outcomes (100%).
Test 1 Calculation and accounting of payroll taxes and self-employed social insurance payments (20%)
Test 2 Duties, rights and responsibilities of the company as a taxpayer. Calculation and accounting of PIT and micro-enterprise tax (20%).

Test 3 Calculation and accounting of value added tax, corporate income tax and other taxes (20%)

Description of the organization and tasks of students’ independent work

During the study course all the required independent work - preparation of tax calculations and declarations (10%), presentation (30%)

Criteria for Evaluating Learning Outcomes

Must be completed for all jobs. Each work is graded. The evaluation of the study course depends on the evaluation of independent work, tests and presentation, 10% corresponds to one point on the 10-point assessment scale.

Compulsory reading

1) Jurušs M. Nodokļi. Rīga: RTU Izdevniecība, 2019. 176 lpp.
2) Leibus I. Uzņēmuma darbības uzsākšana, grāmatvedība un nodokļi. Rīga: Lietišķās informācijas dienests, 2019. 173 lpp.
3) Leibus I. Pašnodarbināto grāmatvedība un nodokļi. Rīga: Lietišķās informācijas dienests, 2020. 148 lpp.
4) Finanšu grāmatvedība. Mācību grāmata. I.Leibus, I.Pētersone, A.Jesemčika, I.Leibus, A.Svarinska, R.Grigorjeva. Rīga, 2020. 319 lpp.

Further reading

1) Ketners K., Lukašina O. Nodokļi ES un Latvijā. Rīga: Merkūrijs Lat, 2008. 237 lpp.
2) Ketners K., Pētersone M. Eiropas Savienības nodokļu politika. Rīga: Rīgas Tehniskā universitāte, 2014. 208 lpp.
3) Ketners K. Nodokļi un nodokļu plānošanas principi. Rīga: Tehnoinform Latvia, 2018. 321 lpp.
4) Kodoliņa-Miglāne I. Nodokļi Latvijā 2007. Rīga: Turība, 2007. 109 lpp.
5) Krogzeme H. Finanses un nodokļi. Rīga: Rīgas Tehniskā universitāte, 2010. 568 lpp.
6) Leibus I. Individuālā uzņēmēja grāmatvedība un nodokļi. Rīga: Lietišķās informācijas dienests, 2008. 260 lpp.

Periodicals and other sources

1) Bilance. Rīga: Lietišķās informācijas dienests. ISSN 1407-5709.
2) Bilances Juridiskie Padomi. Rīga: Lietišķās informācijas dienests
3) Grāmatvedība un Ekonomika Rīga: SIA Grand. ISSN 1691-1172.
4) iFinanses.lv Rīga: Izdevniecība iŽurnāli, 2013 Elektronisks žurnāls. Pieejams: http://www.iFinanses.lv
5) LR likumi un MK noteikumi: Latvijas Vēstnesis. Pieejams: http://www.likumi.lv
6) plz.lv Rīga : Lietišķās informācijas dienests, Elektronisks žurnāls. Pieejams: http://www.plz.lv
7) Valsts ieņēmumu dienesta mājaslapa. Pieejams: http://www.vid.gov.lv
8) Taxation trends in the European Union. Data for the EU Member States, Iceland and Norway. Pieejams: http://ec.europa.eu/taxation_customs/resources/ documents/taxation/gen_info/economic_analysis/tax_structures/2018/report.pdf

Notes

Field theoretical basic course (B2) for the Professional Bachelor's Program "Business and Management"