Foreign permanent residents of Lithuania pay taxes to the Lithuanian government just like Lithuanian citizens. There are several types of taxes in Lithuania. Here's a breakdown of the key taxes and contributions you need to know about if you're living in Lithuania. 

Taxes related to working in Lithuania 

State Social Insurance - SoDra Taxes

known as PSD and VSD 

• Rate: Compulsory Health Insurance 6.98%; Pension Insurance - 8.72%; Sickness Insurance - 1.99%; Maternity Insurance - 1.81%; Unemployment Insurance - 1.31%. 
• Contributors: Both employers and employees contribute. Self-employed individuals also contribute, however their rates depend on the type of individual activity.  
• Coverage: Provides benefits like sickness, maternity, disability, and more.  

Personal Income Tax

known as GPM 

• Rate: Pay 20% if their wage is up to 60 average annual wages, or 32% if it exceeds that amount. 15% rate for sickness, maternity, paternity, childcare, and long-term employment allowances, as well as dividends. Individual Activities are taxed at 5-15%. 
• Contributors: shall be paid by an individual who has received income.  

You can find more information on the website of the State Tax Inspectorate.

Tier II Pension

known as pensijų kaupimas 

• Rate: 3% of your income goes to pension savings, with an additional 1.5% of the country’s average salary contributed by the State budget. 
• Contributors: Starting January 2 each year, all Lithuanian citizens and foreigners with residence permits aged 18 to 40 are automatically enrolled in the pension accumulation scheme, with the option to withdraw funds. 

If you are an employee with a contract, you don’t need to worry about paying taxes directly — your employer handles this on your behalf. However, if you are self-employed, you are responsible for paying taxes yourself. 

Other taxes 

Corporate Income Tax

known as pelno mokestis

• Rate: 16% on the taxable profits.  
• Contributors: Lithuanian entities and foreign entities' permanent establishments. 
• Exemptions: Entities with fewer than 10 employees and income under €300,000 are taxed at 0% during their first tax period.  

You can find more information on the website of the State Tax Inspectorate.

Value Added Tax - VAT

known as pridėtinės vertės mokestnis - PVM

• Rate: Standard rate is 21%. Reduced rates of 0%, 5%, and 9% apply to certain goods and services. 
• Application: Applies to most goods and services bought and sold for use or consumption.  

You can find more information on the website of the State Tax Inspectorate.

Property Tax

known as nekilnojamo turto mokestis

• Rate: 0.5% (for property valued €150,000- €300,000); 1% (for property valued €300,000 - €500,000); 2% (for property valued over €500,000). 
• Contributors:  natural and legal persons of Lithuania and foreign states. 

Tax shall be paid after expiry of the year until 15 February of the next year.  

You can find more information on the website of the State Tax Inspectorate.

Land Tax

known as žemės mokestis

• Rate: from 0.01 % to 4 % of the tax value of land. The specific rates of land tax are set individually by each municipality 
• Contributors: owner of the land – a natural and legal person 
• Tax shall be paid each year by 15 November. 

You can find more information on the website of the State Tax Inspectorate.

Inheritance Tax

known as paveldėjimo mokestis

• Rate: 5% (when value of inherited property does not exceed €150,000), 10% (when property value exceeds €150,000). 
• Contributors: both permanent and non-permanent residents of Lithuania who have inherited property. 
• Exemptions: When a spouse dies, the surviving spouse inherits property tax-free. Children, parents, guardians, grandparents, grandchildren, and siblings also inherit property without any tax. For all others, the inheritance is tax-exempt up to €3,000. 

You can find more information on the website of the State Tax Inspectorate.

Estimate your taxes

You can estimate your taxes using the tax calculators available here.  

The State Tax Inspectorate in Lithuania

VMI in Lithuania is the State Tax Inspectorate. It oversees taxation matters in Lithuania, offering tax services to employees, employers, contractors, and freelancers. VMI also assigns taxpayer identification numbers to foreigners working and living in Lithuania.