Private limited company (UAB) taxes
A shareholder of a Lithuanian private limited company (UAB) may receive payments on different legal grounds. Dividends and salary serve different purposes and are taxed differently.
Dividends paid to an individual: 15% PIT withheld by the Lithuanian company. Employment-related VSD and PSD are not charged on dividends. Payments are reported in GPM313 by the 15th of the following month and in GPM312 by 15 February of the following year. PIT is remitted by the 15th or last day of the payment month, depending on the payment date. [S7, S10]
Dividends require a profit-distribution resolution and supporting financial information. Shareholder status does not itself permit unrestricted use of company funds.
Salary: employee social contributions are 19.5%, plus 3% for additional pension saving. Employer contributions depend on contract type and accident-risk category; common rates for risk group I are 1.77% for an indefinite contract and 2.49% for a fixed-term contract. PIT follows the general annual scale and applicable tax-free allowance. [S8, S3]
Example: EUR 2,000 gross salary, no tax-free allowance or additional pension saving, 20% PIT, employer rate 1.77%: PIT EUR 400, employee contributions EUR 390, net pay EUR 1,210, total employer cash cost EUR 2,035.40. Annual PIT reconciliation may change the final result.
Corporate income tax and dividends combined
Assume accounting profit equals taxable profit of EUR 10,000, all after-tax profit can legally be distributed to an individual, and there are no reserve or other restrictions.
| Corporate tax rate | Corporate tax | Profit after tax | 15% dividend PIT | Net to recipient | Overall tax burden |
|---|---|---|---|---|---|
| 0% | EUR 0 | EUR 10,000 | EUR 1,500 | EUR 8,500 | 15% |
| 7% | EUR 700 | EUR 9,300 | EUR 1,395 | EUR 7,905 | 20.95% |
| 17% | EUR 1,700 | EUR 8,300 | EUR 1,245 | EUR 7,055 | 29.45% |
This arithmetic model uses sources S1 and S10. The same amounts may arise on an MB profit distribution, but PIT payment procedures differ. Simply adding 17% and 15% is incorrect: the second tax applies to the reduced after-tax amount.
Information prepared on 14 October 2026. General guidance, not individual tax advice. Verify eligibility and rates for each case.