VAT looks simple — multiply by 21%. But mixed rates, rounding, the reverse charge and foreign currency complicate the picture fast. Here is how fakts gets it right.
Per line, not per invoice
fakts calculates VAT for each invoice line separately, then groups lines by rate. The reason: a single invoice can mix 21%, 12%, 5% and 0% — and the summary has to show each rate on its own.
The rates
- 21% — standard: most goods and services.
- 12% — reduced: e.g. medicines and medical devices, district heating for residents, public transport, accommodation. Fresh local fruit, berries and vegetables are also 12% (permanent from 2026).
- 5% — reduced: books, press and media.
- 0% — zero-rated: exports, intra-EU supplies, international transport.
The reverse charge is not a “rate”
The reverse charge is a separate mechanism, not a zero rate: the seller issues the invoice without VAT and the buyer accounts for the tax themselves. Domestically it applies to specific categories — timber, construction, scrap metal, certain IT devices, cereals. That is why fakts does not treat it as a “0% rate,” even though the VAT amount on the line is zero.
Rounding
fakts recalculates every figure on the server before saving and rounds to the cent (NUMERIC 15,2). So the total is always consistent and matches what your return expects — no mismatch between what you see and what gets stored.
Foreign currency
If you invoice in another currency, Latvian law requires you to also show the euro equivalent at the European Central Bank (ECB) reference rate at the start of the transaction day. fakts applies that daily ECB rate automatically, so the euro value on the invoice is correct and defensible.