🇱🇹 Tax26 Jun 2025
Lithuania raises corporate income tax to 17% from 2026 to fund defence
Lithuania's Seimas adopted amendments to the Law on Corporate Income Tax in June 2025, raising the standard rate from 16% to 17% and the reduced rate from 6% to 7% from 1 January 2026, as part of a package creating a Defence Fund. The 0% rate for newly registered small companies now lasts two years and depends only on taxable income of up to EUR 300,000.
The tax changes were adopted with the Defence Fund Law.
What changed from 1 January 2026
- Rates: standard corporate income tax rises from 16% to 17%, and the reduced rate for small companies from 6% to 7%.
- Start-ups: the 0% rate for newly registered small companies is extended from one year to two, and the cap of 10 employees is removed. Taxable income must not exceed EUR 300,000.
- Investment: companies can deduct certain fixed assets immediately, if the asset stays in use for at least three years.
- STEM scholarships: up to EUR 2,500 a year per student can be deducted.
Who is affected
Lithuanian companies and their finance teams, including for deferred tax.