Every business is based on an idea. Delusional to think that a business idea is always something new and unique. On the contrary, unique ideas occur rarely. Often, the business idea stems from your skills. You have skills or knowledge transformed into a business idea. For example, you are an automechanic and create your own car service. The idea may come from thinking about the opportunities you miss in your region or, better still, in the global market. State aid for assessing and developing the viability of ideas shall be provided by the Latvian Investment and Development Agency.

How do you know my business idea is good?

In order to assess the potential of the idea, it is first of all desirable to tell others about it – relatives, friends and colleagues. The more you talk about it, the more valuable information you get. The next step is to understand market opportunities and explore potential competitors. To evaluate your business idea, you should answer two questions:

• what problem does this idea solve?
• will anyone be willing to pay for it?

Useful links

Latvian Investment and Development Agency Support for Business Ideas – Ideas Cup.

Data that can be useful for creating your business – Open Data Portal.

A business plan that is properly created and described will be useful for evaluating business opportunities, risks, and investments needed. Moreover, if you want to attract investment, without a serious business plan to live.

A business plan is not just a formality – it is a road map that includes the entire business implementation process from A to Z, from a description of the idea to an estimate of potential profits. This plan allows you to be safe and to take the right steps in different situations.

The business plan must be as realistic as possible, based on verified facts. It must be as short as possible, concrete, clearly worded, easily discernible and understandable. It should be assured that the funds allocated will be used purposefully and effectively.

The business plan should include the following points:

• business idea;
• description of the product or service;
• the necessary equipment and equipment, the possibilities for purchasing or renting them;
• the justification for the number of employees required for the operation of the undertaking, their qualifications;
• planned labour costs, including taxes;
• market assessment;
• the assessment of competitors;
• pricing principles, price policy for goods (service);
• marketing channels;
• planned marketing activities;
• a plan for repayment of the credit (if any);
• calculation of profit or loss (justification of revenue and costs).

The saying, “As ships will be called, it will swim”, is a big part of the truth. Draw attention to the fact that the name does not only reflect the scope of the business and instill confidence, but also stands out among competitors and is well-spoken. The name is the first thing your potential customers and partners know about your business or brand.

Understandably, a company can use different trademarks. Sometimes we know the name of a shop or salon, but we don't know the name of the company that owns it. The brand name you'll use in public business communication is the most important.

It's important to remember!

The selected name must be stated in the same way in all documents to be submitted.

The name of the company selected cannot coincide with any of the names of the company, association, etc. already registered in the Enterprise Register (ER) or registered for registration. A trade mark belonging to another undertaking may not be used in the name of the undertaking. A trade mark and a service mark is a designation used to distinguish the goods and services of an undertaking from the goods and services of other undertakings.

Useful links

Verification and registration of the name of the company.

Check the name of the company the RE information website.

Check the name of the Patent Office in the search for registered trade marks.

Find out, how to register a trademark.

Before starting a business, it is necessary to decide what form of business will be most appropriate. This depends on a number of factors: the amount of capital capital, potential turnover, types of activity, number of employees, etc. If a private individual – a performer of economic activity – has to register with the State Revenue Service (SRS), while the legal person – individual merchant, company with limited liability (SIA), peasant farm or company – should be registered both in the Enterprise Register (UR) and in the SRS, in which the VAT payer should register.

Regardless of the selected form of business, when starting an economic activity, the SRS must provide information on the type of operating activity.

The forms of business differ from one another on a number of relevant criteria:

• a legal or natural person;
• registration;
• number of owners;
• profit/loss distribution;
• minimum share capital;
• the management of the undertaking;
• liability (personal or business);
• procurement of funding.

It's important to remember

• In the case of domestic production or the provision of individual services, the most appropriate forms of business shall be the self-employed or individual merchant.
• If the business is related to your farm, such as a production facility or guesthouse, the individual (family) company is a good choice.
• Farms of farmers and fishermen are a separate form of business which is intended for the entrepreneurs of these sectors.
• The most popular form of business is a limited liability company (SIA). Unlike other forms of business, the liability of the owners of SIA is limited – they are not responsible with their personal property for the company's obligations. It is necessary to establish a core capital of EUR 2800, but it is also possible to register a small capital company with a share capital of even one cent.

Information for young entrepreneurs

Compare different business forms.

Get more information about small Capital Ltd.

A natural person may carry out a comercial activity.

In order to register a legal person, it is necessary to submit documents to the Enterprise Register (UR).

• Registration can be carried out electronically on the portal Latvija.lv, where an e-signature-signed application for the entry of a capital company in the commercial register can be submitted.
• An application for registration of a business may be prepared in a free form, including all the information specified in regulatory enactments necessary for registration. In order to facilitate the preparation of applications, a description of the services is available on the UR website, as a step by step, to draw up the necessary documents for the establishment of the company to be submitted for the purposes of the UR registration records.
• In paper format, documents can be submitted by sending UR by post.

For a newly established company, which is required to set up and pay down fixed capital in accordance with regulatory enactments, it is necessary for the UR to open a temporary current account (except for a company whose share capital is less than EUR 2800,00) in order to make a share capital contribution of the company.

IMPORTANT
From January 1st 2023  e-addresses use for companies, etc. legal entities registered in registers will be mandatory. This means that all communication with public and local authorities will be possible by electronic means  e-address or the e-services provided by the authorities.

Choose the most convenient way to register your business:

• open e-service Registration of the registers kept by the Enterprise Register, complete it and submit it;

• write an application, sign with secure signatures  electronic signature and send to RE  e-address or to pasts@ur.gov.lv;
• on-site in the register of companies.

Useful links
Registration of the company in Latvia and abroad

Register your business in the register of companies. Find out what it is  e-address and how to create it.
Creates your own business  e-address.
Step by step – favourites how to create an SIA.
Step by step – favourites how to start a small capital company.
Receives information about business opportunities in EU countries.
Data that can be useful for creating your business open data portal.

If you want to act as a natural person in your field, you must register with the SRS as a taxpayer - the performer of economic activity before commencing the activity, indicating the area in which you will perform the economic activity. Such a form of action is appropriate if you don't have plans to build a serious business, hire employees, buy, sell or produce something, not only to fill your personal budget, but to a wider extent. As a performer of economic activity, you can operate in almost every area with a few exceptions.

Important!

Favorites before recording! Areas in which only economic operators registered in the Enterprise Register can operate, so legal persons:

• brokers;
• commercial agents;
• carriers;
• dealers of motor vehicles and other light-duty vehicles;
• commercial operators with excisable goods.

If you want to operate in these areas, you must register as an individual merchant or establish an SIA.

It is noted that when you register as a performer of economic activity, you must certify the right to pursue the profession in question if it is determined by the regulatory enactments regulating the scope of professional activity. Consequently, if the pursuit of a professional activity requires adequate qualifications, it shall also apply to economic operators.

If the business activity takes place outside the declared address, it is necessary to register a unit that can be both an office, a website, a mobile application, an Internet platform, and an outward service or activity abroad.

In addition, the SRS should be registered as a VAT payer if:

• you will carry out VAT transactions, namely marketing goods or providing services;
• you will receive services from another Member State or a third country or a third-area taxable person for which VAT is to be paid by the recipient of the service itself (i.e. all services except those referred to in Articles 20 to 30 of the VAT Act);
• will purchase goods on the territory of the European Union for an amount exceeding EUR 10 000.

Useful links

Registration and information of economic activity

Register economic activity in the SRS Electronic Declaration System.

Watch the video guide – how to register as a performer of economic activity.

Read the SRS prepared guide for future businesses.

Get acquainted with the taxpayer procedures for Registration.

Find your industry statistical classification Catalogue.

Where the economic activity takes place outside the legal or declared address registers it in the SRS as a unit.

Learn more about Value Added Tax on the SRS website.

Read more information and find answers to key questions on the SRS website.

Attracting investment is a strategic decision. We recommend that you do this to develop or expand your business, while starting your business is safer to do with your own resources. However carefully calculated, real life can make adjustments in the plans.
In order to acquire additional knowledge, contacts and support, it is recommended to go to the Investment and Development Agency of Latvia (IDAL), which grows and breeds hundreds of small businesses in business incubators. There will help you prepare your business for investment and attract it later. Moreover, the experience that can be gained in daily communication with other entrepreneurs is invaluable.

Investors can also be looked for permanently – there will be a good business plan for the rain.

Serious Links
Information on investment opportunities in

Use the Investment and Development Agency of Latvia (IDAL) programmes implemented
Learn about Ministries of Economics support measures for young entrepreneurs.
Receives advice on funding raising to the IDAL in customer service departments.
Find out about support for young entrepreneurs in the IDAL business incubators.
Apply for advice AS "Development Finance Institution Altum" by completing the application "Apply for counselling".
Reveals AS Development Finance Institution "Altum" start-up and development support programmes.
Learn about aid for the processing of agricultural and fishery products provided by the Rural Support Service.
Receives IDAL support for start-ups on informational platforms Good of Latvia and Start up Latvia.

Different programmes are available to support entrepreneurs, assisted by knowledge, experience and funding. Specific national programmes are targeted at both farmers and business start-ups, investment seekers and technology companies. Various mentoring and support programs are also offered by private investors and business-support associations.

Useful links

Information on access to State aid

Meet the establishment of the Latvian Centre for Digital Innovation digital development guide for Latvian companies.
Take advantage of the opportunities provided by National Platform for Business Development.
To be completed by the Latvian Information and Communication Technology Association (AT) Digital maturity test.
Acquire knowledge and find comrades – join IDAL for Business Inhibitors.
Learn more about Altum Support for Business Start, designed to encourage the involvement of citizens in business.
Visits the Latvian Investment and Development Agency to take action free seminars and conferences.
Learn more about “Altum” for Business Services.
Learn the different support programmes for rural entrepreneurs Rural Support Service.

Business activities often require different authorisations and licences. They may relate both to the nature of the company's activities and to other factors, such as obtaining a public performance license for music to be able to play music publicly, including radio transmissions in a shop or cafe. So, before starting a business, you should get acquainted with list of licences and authorisations issued by national authorities.

Useful links
Most common special permits (licences) and their issuing authorities

State Revenue Service shall issue special permits (licences) for excisable goods for commercial activities of with excisable goods.
Akka/LAA issues Music Public Performance Licenses in to enable the company to use copyright-protected works in public events and public places.
The Food and Veterinary Service shall register or recognise food establishments in which are involved in any stage of the food chain.
The Health Inspectorate (VI) shall perform the registration of medical treatment institutions in, evaluating the compliance of the medical treatment institution with the mandatory requirements.

More information on the registration of medical treatment institutions is available at on the Health Inspectorate website.
The Ministry of Economy shall perform registration of real estate intermediaries; and issue licences for the production of electricity.
The Health Inspectorate shall issue permits for the provision of beauty services.
The website of the Register of Undertakings shall be available on the website of the national authorities list of licences and licences.

The Register of Enterprises (RE)

The Patent Office (PO)

The State Employment Agency (SEA)

The State Revenue Service (SRS)

The State Labour Inspectorate (SLI)

The Investment and Development Agency of Latvia (IDAL)

The Central Statistical Bureau (CSB)

The Rural Support Service (RSS)

Starting a business

Employment of foreigners, adolescents and disabled persons