New regulations: Cash payments of wages must be reported in the employer's reports.
The Cabinet of Ministers Regulation No. 827 has been supplemented with a new requirement that will affect all employers who pay wages to employees in cash. This change stipulates that from 1 July 2025, employers must make precise annotations regarding this type of payment in their employer's reports.
What does the new point stipulate?
The new point 33.2 of the CM regulations No. 827 stipulates:
Payment of wages in cash: If an employer pays an employee's income in cash, this must be noted in column 16 of the employer's report.
Transition period: Although the amendments are effective from 12 October 2024, this specific requirement becomes binding from 1 July 2025.
Why are these changes important?
This change promotes transparency, reduces the risks of the shadow economy, and improves tax administration. It will help the State Revenue Service (SRS) better monitor the types of income payments and ensure that appropriate tax payments are made on all income.
What does this mean for employers?
Additional information recording: Employers will need to ensure that accurate information on the type of wage payment is included in employer reports.
Opportunity to prepare in advance: Although the requirement comes into effect in mid-2025, employers are advised to adjust their accounting systems now.
How to prepare for these changes?
Review payment processes: If you pay wages in cash, ensure that you can easily record and annotate them in reports.
Update accounting systems: Ensure that the systems used allow for easy completion and submission of accurate reports.
Consult with specialists: Ensure that your business meets all SRS requirements to avoid potential penalties in the future.
How can the Unified Account help?
Vienotais Konts SIA provides full-cycle accounting services to facilitate companies’ daily operations and prepare them for new legislative amendments:
Modernisation of accounting systems: We help implement digital solutions that comply with all new requirements.
Consultations on new regulations: We provide accurate information and practical assistance to ensure that your company’s documentation complies with the legislation.
The Cabinet of Ministers Regulation No. 827 has been supplemented with a new requirement that will affect all employers who pay wages to employees in cash. This change stipulates that from 1 July 2025, employers must make precise annotations regarding this type of payment in their employer's reports.
What does the new point stipulate?
The new point 33.2 of the CM regulations No. 827 stipulates:
Payment of wages in cash: If an employer pays an employee's income in cash, this must be noted in column 16 of the employer's report.
Transition period: Although the amendments are effective from 12 October 2024, this specific requirement becomes binding from 1 July 2025.
Why are these changes important?
This change promotes transparency, reduces the risks of the shadow economy, and improves tax administration. It will help the State Revenue Service (SRS) better monitor the types of income payments and ensure that appropriate tax payments are made on all income.
What does this mean for employers?
Additional information recording: Employers will need to ensure that accurate information on the type of wage payment is included in employer reports.
Opportunity to prepare in advance: Although the requirement comes into effect in mid-2025, employers are advised to adjust their accounting systems now.
How to prepare for these changes?
Review payment processes: If you pay wages in cash, ensure that you can easily record and annotate them in reports.
Update accounting systems: Ensure that the systems used allow for easy completion and submission of accurate reports.
Consult with specialists: Ensure that your business meets all SRS requirements to avoid potential penalties in the future.
How can the Unified Account help?
Vienotais Konts SIA provides full-cycle accounting services to facilitate companies’ daily operations and prepare them for new legislative amendments:
Modernisation of accounting systems: We help implement digital solutions that comply with all new requirements.
Consultations on new regulations: We provide accurate information and practical assistance to ensure that your company’s documentation complies with the legislation.