Latvian Management Fee: How It Is Calculated and Whether VAT Applies

The short answer. The fee for managing a house is set by the owners' community. If the owners have not agreed their own arrangement, Cabinet Regulation No. 408 applies: the fee is a euro amount per square metre of the house's useful floor area per month, it must be notified by 15 October, and the owners have six weeks to approve or reject it. Latvia's standard VAT rate is 21%, but how it applies to a particular management fee is a question for the State Revenue Service (VID) or an accountant.

Who sets the fee: the community or the regulation

Art. 13 of the Law on Apartment Property (Dzīvokļa īpašuma likums) says an apartment owner pays, in proportion to the co-ownership share that belongs to their apartment, the expenses the community has decided on for the obligatory management activities, and the remuneration the community sets for the manager if the management contract provides for one. Art. 16 reserves the procedure for setting and paying management expenses to the community itself.

If the owners have not agreed, art. 50(4) of the privatisation law has the Cabinet set the procedure by which a manager calculates the fee, draws up the work estimate, notifies owners and prepares the annual report. Cabinet Regulation No. 408 was issued for that purpose. It is not a universal Latvian rule: it is issued under the privatisation law and covers houses whose owners have not set up their own arrangement. In a house where the community has taken over management and agreed a procedure, the community sets the fee.

How the fee is calculated under Regulation No. 408

The manager's estimate includes a payment for the management service, made up of the obligatory expenses and the remuneration for management, and a payment for maintenance works to be carried out in later periods (repair, renewal or reconstruction). Point 8 of the regulation gives a formula whose result is euro per month per square metre of useful area. Its variables:

• P — management payments, euro per month per square metre of useful area
• I — management expenses for the next calendar year, euro per year
• A — remuneration for management
• U — payment for maintenance works to be carried out in later periods, euro per year
• Pl — the house's useful area in square metres, per the cadastral survey file

The price of each service must be shown separately in the estimate, and the obligatory expenses go into the estimate of each individual house. The manager also does the settlement with service providers for each house separately — point 6 of Cabinet Regulation No. 1013, issued under the same regime. Latvian law does not require a separate bank account for each house, and it does not require charges to be paid cashlessly.

The calendar: 15 October, six weeks, 1 January, 1 April

In the default regime of Regulation No. 408:

1. By 15 October the manager notifies each owner in writing of the calculated management fee for the next calendar year and says where the estimate and the maintenance work plan can be read (for example the house file, a website, a notice board).
2. On an owner's written request the manager sends the estimate and the work plan within one week.
3. Within six weeks of the date named in the notice, the community decides whether to approve or reject the plan and the fee. The community cannot refuse to have the obligatory management activities carried out.
4. If the general meeting was not quorate or no decision was taken, the plan and fee take effect on 1 January of the next year, or on another date set by the manager.
5. By 1 April each year the manager tells owners where to read the previous year's income-and-expenditure report.

So the accurate description of this regime is "about two and a half months' written notice and a six-week window to object" — not a generic "30 days". Separately, art. 15 of the Law on the Administration of Residential Houses requires the manager to present the work plan to the owner in writing at least once a year and to give a written report on what was done and how funds entrusted to it were used; the report must show owners' total arrears for each service separately.

Utilities: directly to the provider by default

The management fee is not the same as utility payments. Art. 17.3 of the Law on the Administration of Residential Houses says that for the services needed to maintain the house the owner settles with the service provider by direct payments. The owner may decide to have an authorised person, who can be the manager, collect the payments; the manager must then pass on what it receives from the owner to the provider immediately and in exactly the amount the owner paid (art. 14(4²)).

A savings fund exists only on a community decision: the owner pays into it on the strength of that decision, and the community sets how the money is used. The law sets no obligatory minimum accrual rate. A manager may not use owners' savings to cover its own losses or another owner's arrears.

The invoice and the debt notice

The law is precise about the debt notice (art. 17.6). It must state: the make-up of the debt, with principal, default interest and contractual penalty shown separately; the total debt; the deadline for payment; the place of payment and the payment details. The payment deadline cannot be shorter than the last working day of the following calendar month. An invoice also counts as a debt notice if it contains all of that information — so it is worth building those fields into the invoice template.

Default interest is owed by operation of law, without any contract clause; where a consumer is a party it is six percent a year unless the contract sets another rate (arts. 1759 and 1765 of the Civil Law).

VAT: what to know and what to check

Art. 41 of the Value Added Tax Law sets the standard rate at 21 percent. The exemption list in art. 52 names residential rent among services supplied to residents. The law also has specific rules for those who provide residential-house management services: the option to apply the tax-payment and input-tax regime of art. 137 (where the previous year's transaction value was between €100 000 and €2 000 000), and input-tax rules for an intermediary who passes the tax it receives on in full to the actual supplier (art. 92(3¹)). The domestic registration threshold is €50 000 a year excluding tax (art. 59).

What we do not say: whether and how exactly 21% applies to the management fee of a particular house. We have not used VID guidance on that question, so ask VID or your accountant before you put VAT on an invoice or in a management contract.

How Unitify handles it

Unitify's billing module (Easybilly) applies each building's own rules: charges can be per square metre, per apartment, per resident or a flat amount, and every invoice line says where its number came from. The invoice can reach residents in the resident app as a PDF with a QR code. Card payments run through Unitify's integrated Stripe acquiring; residents already pay by SEPA bank transfer, and Unitify's billing reconciles it. Unitify integrates no other Latvian payment rail — in Latvia those are market context, not our integrations.

Unitify does not apply tax law for you: set VAT with your accountant. See the pricing page for prices and the free plan, and Unitify in Latvia for how we work there.

Related reading

• Latvian house file and BIS: what goes in and who keeps it
• General meeting and written survey of apartment owners: how to convene and vote

Based on arts. 13, 15.2 and 16 of the Law on Apartment Property (redaction from 29 May 2026), arts. 14, 15 and 17.3–17.6 of the Law on the Administration of Residential Houses (redaction from 16 July 2025), Cabinet Regulations No. 408 and No. 1013, arts. 1759 and 1765 of the Civil Law, and arts. 41, 52, 59, 92 and 137 of the Value Added Tax Law, as published on likumi.lv. Latvian laws are amended often — check the current redaction before you rely on this. This is not legal or tax advice.

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