COVID-19: useful information for businesses in Lithuania
In these trying times, Invest Lithuania continues to co-operate pro-actively with investors. Our team has collected information regarding the challenges and issues faced by investors during the COVID-19 (coronavirus) pandemic, including issues related to migration, state support, or the lack of relevant information provided in English. To provide a clearer picture for our investors and partners we have addressed these questions to the competent authorities and compiled the information gathered. The result is the following FAQ’s, which we will be updating continuously in the coming weeks.
We hope this will be a valuable resource, and if you feel there are any further areas you would like us to cover, please feel free to contact us.
Frequently asked questions
Information last updated on 16th June, 2020
1. Support measures for business
1.1. Financial aid package presented by the Ministry of Finance
The Ministry of Finance has presented an aid package worth EUR 2 billion for companies affected by the coronavirus, who may already apply for additional funding.
The package includes grants, guarantees and other financial instruments.
Companies facing difficulties due to the coronavirus and currently lacking working capital should review their loan repayment schedules and contact financial institutions (banks, leasing or factoring companies, credit unions, crowdfunding platforms, etc.), who will provide them with all the necessary information.
Initiatives adopted by the Ministry of Finance:
- evaluation terms for the issuing of guarantees is to be shortened, new measures and schemes for their implementation are to be developed;
- the concept of revolving loans is to be expanded (loans/guarantees will be granted not only for business development but also for liquidity);
- additional funding activities are to be included;
- no regional restrictions will remain in force;
- measures will be accessible for large companies as well;
- the range of service providers is to be expanded (alternative funders may join);
- the limit of guarantees is to be increased by more than 4 times;
- interest will be reimbursed for 6 months (for loans – from the date of the beginning of quarantine), when a banks grants loan repayment leave.
Currently, all existing measures for business offered by Investment and Business Guarantees (INVEGA), Lithuania Business Support Agency (LVPA), European Social Fund Agency, Agricultural Credit Guarantee Fund are still applicable.
1.2. Financial aid package presented by the Ministry of the Economy and Innovation
Lithuania’s Ministry of the Economy and Innovation has announced an aid package for small and medium enterprises (SMEs), as well as large companies facing difficulties due to coronavirus.
The following initiatives have been adopted by the Ministry of the Economy and Innovation:
- Loans to SMEs in order pay bills to suppliers with whom they have been unable to settle accounts due to the suspension of business activities. For more information, please visit here.
- Loans to maintain liquidity for both SMEs and large companies. For more information, please visit here and here.
- Loans to SMEs from alternative investors. For more information, please visit here.
- Compensation for real estate costs. Businesses whose activities, carried out in leased premises, have been suspended due to quarantine being declared, can apply for partial compensation for lease payments. For more information, please visit here.
For more information regarding the financial measures to support businesses provided by Investment and Business Guarantees (INVEGA), please visit here.
In addition, a further initiative has been announced:
- COVID-19 special fund for medium and large companies, helping businesses to recover more quickly from disruptions resulting from the COVID-19 outbreak. Various financial instruments will be used, including loans, bonds, convertible bonds and shares, as well as funds from other investors. Initially, the Fund plans to allocate EUR 100 million. The Fund will be established once all related legislation has been approved by the competent authorities.
For more information, please visit here (currently available only in Lithuanian).
1.3. Contact details
For more detailed information please contact the Ministry of Finance, the Ministry of the Economy and Innovation or Investment and Business Guarantees (INVEGA).
- Ministry of the Economy and Innovation – firstname.lastname@example.org or (+370) 706 64 845 / (+370) 706 64 868
- Ministry of Finance – email@example.com or (+370) 5 239 0000
- Innovation or Investment and Business Guarantees (INVEGA) – firstname.lastname@example.org or (+370) 5 210 7510
2. Tax payments
2.1. Automatic postponement of tax payments
The State Tax Inspectorate (the STI) announced a list of taxpayers that may have been directly affected by the coronavirus. You can check the list here (currently available only in Lithuanian).
From the 16th of March 2020 until the end of the state of emergency and for 2 months afterwards, all taxpayers listed in this announcement will be automatically exempt from the following (with no additional need to appeal to the STI):
- tax recovery (i.e. the STI and the State Social Insurance Fund Board (SODRA) will not collect reported and unpaid taxes);
- interest payment (i.e. the STI and SODRA will not calculate interests for late payment of taxes).
2.2. Individual requests for the postponement of tax payments
Taxpayers who have not been included in the list, but have also been affected by the coronavirus and would like to postpone tax payments (i.e. conclude a tax loan agreement or use a tax recovery or interest payment), can submit a simplified application to the STI.
The taxpayer needs to:
- fill in an application form (currently available in Lithuanian only);
- indicate the reasons why the applicant should be considered to have been negatively affected by the coronavirus (e.g. due to restrictions directly applicable to economic activities, changes in the market, negative impact caused by the coronavirus to business partners’ economic activities, etc.).
No additional mandatory documents are required when submitting an application form, but STI retain the right to request them in individual cases.
2.3. Tax loan agreements
A tax loan agreement can only be concluded when the taxpayer has an obligation to pay taxes (i.e. has submitted tax return forms and the obligation to pay taxes has occurred before the 16th March).
After the end of the state of emergency, taxpayers on the announced list will have 2 months to enter into a tax loan agreement. When the tax loan agreement has been concluded, tax payment may be postponed until the end of the state of emergency and should be paid according to an agreed timetable (if the taxpayer does not request an increased payment). Those who already have such agreements may submit a request to change their tax loan schedule and terms.
2.4. Other postponed tax obligations
The deadline for declaring and paying annual personal income tax is postponed until the 1st of July 2020. The start of the period for the filling of personal income tax returns was postponed and commenced on the 15th of April.
The term for the repayment of personal income tax overpayments remains unchanged. Taxpayers who have correctly and punctually filed their returns will be refunded by the 31st of July 2020.
2.5. Real estate and land taxes
The Municipality of Vilnius adopted a decision valid from the 16th of March 2020 until the end of the state of emergency and quarantine period:
- to exempt real estate taxpayers (i.e. legal and natural persons whose activities were limited or restricted due to the state of emergency) from the obligations to pay real estate and land taxes;
- taxes will be collected from taxpayers that still operate during the state of emergency e.g. food retailers, pharmacies and etc.
It is important here to note that each municipality retains the right to individually decide whether the real estate and land taxes should be reduced due to the state of emergency or quarantine. For more detailed information, please contact the relevant local municipality.
2.6. Contact details of State Tax Inspectorate
For more detailed information please contact the State Tax Inspectorate or read more information here (currently available in Lithuanian only).
State Tax Inspectorate – email@example.com or (+370) 5 266 8200
3. Social insurance
3.1. Contact details of State Social Insurance Fund
For more detailed information regarding social insurance notifications, issuance of certificates of incapacity for work and benefits, as well as other issues during the quarantine, please contact the State social insurance or read more information here.
State Social Insurance Fund – firstname.lastname@example.org or (+370) 5 250 0883
4. Idle time
4.1. Announcement of idle time
Employers have the right to announce idle time due to the state of emergency and (or) quarantine under Article 47 part 1 (2) of the Labour Code, providing the following requirements are met:
- the employer is not able to provide work to the employee as agreed in the employment contract; and
- the employee is not able to work remotely due to the nature of the company’s activities or does not agree to perform other work proposed by the employer (if available in the company).
If the employee is able to work remotely or accepts the proposal to perform other work, idle time cannot be announced.
4.2. Idle time in different economic sectors
Regardless of the economic sector, the employer has the right to individually evaluate whether, due to the state of emergency and quarantine, it is necessary to announce full or partial idle time under the norms of the Article 47 part 1 (2) of the Labour Code (i.e. when the employer cannot provide work to the employee as agreed in the contract due to the employee not being able to work remotely because of the specific nature of the work in question).
4.3. Additional conditions once idle time is announced
If idle time is announced due to the state of emergency and (or) quarantine, the following conditions apply:
- the employees must not be required to be at their workplace;
- the employer must pay no less than a minimum monthly salary (i.e. EUR 607 for full-time employees) irrespective of the salary indicated in the contract. Part of the expenses incurred by the employer due to idle time payouts will be compensated. See detailed information about the state subsidies below;
- the employer must submit notification of idle time to the State Labor Inspectorate within 1 business day.
4.4. Partial idle time
The employer has a right to announce partial idle time due to the state of emergency and (or) quarantine. In such cases, an employee’s allocation of working days may be reduced by working days per week (at least 2 working days) or hours per working day (at least 3 hours per day). In such cases, payments should be calculated proportionally: employees should be paid their salary for the time they have worked, and for idle time they should be paid no less than the minimum monthly salary in Lithuania.
4.5. Notification process of the idle time
When idle time is announced, the employer is obligated to notify the State Labor Inspectorate no later than within 1 business day.
The employer needs to fill in this form online (currently available in Lithuanian only).
No additional mandatory documents are required when submitting this special form. The State Labor Inspectorate retains the right to request additional information or additional documents on an individual basis. It is important to note that employers are obligated by law to keep a physical record on site of all the internal documents regarding the announcement of idle time (i.e. internal procedures, decisions of the director, etc.).
4.6. Contact details of State Labor Inspectorate
For more detailed information please contact the State Labor Inspectorate or read more information here.
State Labour Inspectorate – email@example.com or (+370 5) 213 9772
5. Subsidies for wages paid during the idle time
5.1. Request for state subsidies
All employers, regardless of their economic sector, are entitled to state subsidies for their employees’ salaries if idle time was announced due to the state of emergency and quarantine under Article 47 part 1 (2) of the Labour Code.
To qualify for state subsidies, employers also need to fulfill the following additional requirements:
- during the past year the employer and its representatives have not had any administrative penalties for illegal or undeclared work, or violations for employing foreign nationals;
- during the last year the employer’s representatives have not had more than one administrative penalty for violations of labour laws, occupational safety and health regulations, or the terms of commercial activities;
- the employer does not have the status of a budgetary entity;
- the employer must not be bankrupt or in liquidation.
5.2. The amount of state subsidies
An employer has the right to select from two models as regards their eligible amount of state subsidy for idle time:
- 70% of the salary of the employee, but not more than EUR 910.5 gross (for a full month of idle time); or
- 90% of the salary of the employee, but not more than EUR 607 gross (for a full month of idle time).
In the event that idle time is announced for less than a month, the amount of state subsidy will be calculated proportionally.
5.3. The duration of subsidies
State subsidies shall be paid from the date when the idle time was announced due to the state of emergency and quarantine.
Employers must retain at least 50 % of all employee positions (workplace) for which state subsidies were paid for at least 3 months after the end of the subsidy payments. Otherwise, the employer will need to return the subsidy in full amount.
5.4. Application process
In order to claim state subsidies, an application form and additional documents need to be submitted to the Employment Authority. Documents that are submitted electronically should be signed using a qualified electronic signature.
5.5. Submitting an application for the first time
When the employer is applying for state subsidy for the first time, the following documents must be submitted by the end of April or by the 15th of the following month e. g. if idle time is declared for the first time from April, documents can be submitted until the 15th of May:
- an application form for the payment of subsidy for the wages of employees on idle time. Please find the filling instructions here (currently available in Lithuanian only);
- copies of the internal documents stating that idle time has been declared.
5.6. Submitting application for subsequent months
When an employer is applying for state subsidy for subsequent months, the following documents must be submitted by the 15th day of the following month:
- an application form for the payment of subsidy for the wages of employees on idle time (available in Lithuanian only);
- copies of documents confirming that idle time has been declared;
- documents proving that the previous month’s salary for which the subsidy has been granted was paid to employees.
5.7. Applying for a subsidy only once
An employer who applies for a state subsidy only once, or where the payment of the state subsidy is terminated, must submit documents to the Employment Authority confirming that their employees were paid the salary for which the state subsidy was granted. These documents must be submitted within 30 days from the date the subsidy was received.
5.8. Contact details of Employment Authority or Ministry of Social Security and Labour
For more detailed information, please contact the Employment Authority or Ministry of Social Security and Labour or read more information here.
- Employment Authority – firstname.lastname@example.org or 1883 / contact list based on regions
- Ministry of Social Security and Labour – email@example.com or (+370 5) 266 42 01
6. Subsidies for wages paid after idle time and quarantine / emergency situation
6.1. Request for state subsidies after the emergency situation and quarantine
The types of employers listed below will be entitled to state subsidies following declared idle time due to the emergency situation and quarantine:
- Employers who declared idle time during the quarantine, received subsidies to compensate workers’ wages during downtime, and maintained their jobs.
- Employers included in the list of companies affected by coronavirus, compiled by the State Tax Inspectorate (please find the list here).
- Employers who received subsidies prior to quarantine to compensate the wages of supported workers (e.g. employees with disabilities), and who declared downtime during quarantine, received subsidies to compensate for the wages of workers during downtime, and maintained these jobs.
6.2. Amount and duration of subsidies
State subsidies will be paid for up to 6 months after the end of the emergency situation and quarantine. The amounts of subsidies will vary between 30% and 100% of the salary of the employee.
If the employer is included in the list of potential growth companies approved by the Minister of Economy and Innovation (the ‘List of potential growth’), such employers will be able to benefit from a higher level of subsidies.
Subsidies for Months 1 and 2
- Standard: 100% of the employee’s salary, not exceeding the minimum monthly wage (MW), i.e. a maximum of EUR 607 gross.
- If the employer is included in the List of potential growth:
- 70% of salary, not exceeding 2 x MW (i.e. a maximum of EUR 1,214); or
- 100% of salary, not exceeding 1 x MW (i.e. a maximum of EUR 607).
- If the employee has a fixed-term or seasonal employment contract: 100% of salary, not exceeding 0.5 x MW (i.e. EUR 303.50).
Subsidies for Months 3 and 4
- Standard: 50% of salary, not exceeding 1 x MW (i.e. a maximum of EUR 607).
- If the employer is included in the List of potential growth: 50% of salary, not exceeding 2 x MW (i.e. a maximum of EUR 1,214).
- If the employee has a fixed-term or seasonal employment contract: 50% of salary, not exceeding 0.5 x MW (i.e. a maximum of EUR 303.50).
Subsidies for Months 5 and 6
- Standard: 30% of salary, not exceeding 1 x MW (i.e. a maximum of EUR 607).
- If the employer is included in the List of potential growth: 30% of salary, not exceeding 2 x MW (i.e. a maximum of EUR 1,214).
- If the employee has a fixed-term or seasonal employment contract: no subsidy is available.
6.3. Application process
Please note that the Employment Authority is still in the process of preparing relevant information regarding the application process and the List of potential growth.
For more detailed information, please contact the Employment Authority directly using the details below, or visit here.
7. Guidelines for employers
7.1. How to ensure the health and safety of employees
The State Labour Inspectorate has prepared relevant information, recommendations and guidelines for employers, advising them on how to ensure the health and safety of their employees during the COVID-19 (coronavirus) pandemic. For details, please visit here.
Please note that the State Labour Inspectorate regularly updates the recommendations and information it provides for employers based on decisions taken by the relevant authorities in particular fields.
For more detailed information please contact the State Labour Inspectorate.
State Labour Inspectorate – firstname.lastname@example.org or (+370 5) 213 9772
8.1. Migration requirements
As of 17 June 2020, new measures have come into effect with regard to entry into the territory of the Republic of Lithuania, and requirements for isolation.
Internal border controls have been extended from 17 June 2020 to 14 September 2020.
Foreign citizens, arriving in Lithuania from affected countries (where there have been more than 25 cases / 100,000 population in the last 14 calendar days) have to provide a negative result from a COVID-19 test taken within 72 hours prior to arrival.
- The entry of foreign citizens into Lithuania is prohibited, except for citizens of the following countries:
- Member countries of the European Economic Area (EEA);
- the Swiss Confederation;
- the United Kingdom of Great Britain and Northern Ireland;
- persons who lawfully reside in the abovementioned countries, and who arrive from these countries, provided that the rate of coronavirus infection (COVID-19) cases in the country in which they lawfully reside has not exceeded 16 cases per 100,000. The list of such countries shall be approved and made public every Monday by the State Commander of National Emergency Operations. Please find the list here (currently available only in Lithuanian);
- foreigners lawfully residing in countries that have not been listed above, and which are included in the EU-level list of third countries, for the residents of which temporary restriction on non-essential travel to the EU should be lifted at external borders, unless the incidence of COVID-19 in these countries does not meet the incidence criteria specified above;
- persons entitled to reside in the Republic of Lithuania;
- foreigners who are family members of Lithuanian citizens;
- foreigners who have the right to permanent residence in Lithuania;
- drivers and crew members working in the commercial and/or international transportation of goods;
- persons enjoying immunities and privileges as diplomats (under the Vienna Convention on Diplomatic Relations and the Vienna Convention on Consular Relations);
- persons serving in the military units of NATO and of NATO countries (including service personnel and their family members);
- foreigners who, in exceptional cases, shall be allowed entry into the Republic of Lithuania on the basis of individual permission granted by a minister holding jurisdiction in the respective area, and whose entry has been approved by the Government;
- health professionals arriving for the provision of health care services;
- journalists, artists, high-performance athletes and their service personnel, with the permission of the competent authority.
- The entry of foreign citizens into Lithuania is prohibited, except for citizens of the following countries:
8.2. Travel restrictions – Air, road, rail, sea
Most of the flights to and from Lithuanian airports have resumed. For more detailed information about the resumption of passenger flights, please visit here (Vilnius Airport information), here (Kaunas Airport information) or here (Palanga Airport information).
Entry into the territory of the Republic of Lithuania of persons and/or their private passenger cars shall be allowed only at the Medininkai–Kamenyj Log, Raigardas–Privalka, Šalčininkai–Benekainys, Kybartai–Černyševskoje, Panemunė–Sovetsk crossing points, and at all state border crossing points between the Republic of Lithuania and the Republic of Latvia, and between the Republic of Lithuania and the Republic of Poland. The entry of diplomatic transport shall be allowed at all road state border crossing points.
In exceptional cases, the entry of persons and/or their private passenger cars into the territory of the Republic of Lithuania shall be allowed at other international border crossing points, where permission has been granted by the Head of the State Border Guard Service or his authorised personnel.
As of 11 May 2020, domestic travel by train is permitted.
Border crossings for passengers and freight are permitted via Vilnius railway station border crossing point Stasylos – Benjekoni, Kena – Gudagai, Kybartai – Nesterov, Šeštokai – Trakiszki and at all the state border crossing points with the Republic of Latvia. Border crossings for commercial and/or international freight transportation by rail may also be carried out via the Pagėgiai – Sovetsk railway border checkpoint.
For more information, please visit here.
Sea port border crossing checkpoints – Pilies, Malkų įlankos, Būtingė oil terminal and Molo border checkpoint.
8.3. Requirement of isolation
Every week, Lithuania publishes a list of affected countries (with a COVID-19 incidence rate of more than 16 cases per 100,000 population over the last 14 days). All persons, arriving from affected countries, have to self-isolate for 14 days and follow mandatory isolation regulations.
An isolation period is mandatory even if the test results are negative, because the incubation period is longer, and it is hard to tell whether the person will fall ill or not.
Persons returning/arriving from countries that are on the list of countries affected by COVID-19 or persons travelling through the affected countries, except when travelling by air and not leaving the airport transit area, are required to register with the National Public Health Center (NPHC) within 48 hours of returning/arriving in Lithuania. Those travelling by land transport, they are required to register with the NPHC within 12 hours of returning/arriving in Lithuania, as such persons are deemed to have been exposed to the virus.
Foreign citizens who have arrived in Lithuania for the purposes of work, business or study, and who are obliged to undertake 14 days of self-isolation, may apply to the NPHC for permission to leave their place of self-isolation for work, study or for other business purposes. Please find the request form here.
9. Government decisions and other relevant information about COVID-19
9.1. Contact details
For more detailed information about Government decisions and other relevant information about the COVID-19 (coronavirus) situation in the Republic of Lithuania, please visit here.