MYTH: Upon regaining taxes paid in another country, you may have to pay more in Lithuania
Income received in a foreign country, with which Lithuania has signed a double tax agreement, is not taxed if taxes have already been paid off of this revenue to the foreign country. Even upon regaining a part or all paid taxes, for example from the United Kingdom, Lithuanian citizens do not have to pay anything in Lithuania.
MYTH: Upon regaining taxes paid in a foreign country, it will no longer be possible to work there legally, receive a pension from it, social benefits and other social guarantees
There are two main tax types in a tax system: social taxes and income taxes. It is only possible to regain overpaid income taxes. Thus, social guarantees – retirement pension or benefits – are under no risk; they are always linked solely to social taxation. You can only ever work in a foreign country legally, as per what the law outlines and it has nothing to do with the tax system.
MYTH: Regained taxes are such a small amount, it’s not worth to even bother
Based on our company’s experience, we can say that the average sum of overpaid tax is around 804 euro. What part of paid taxes returns can only be judged after analysing every individual situation. There are cases, where 100, 80 or 45% of paid taxes are returned, but there are also cases, where there are no overpaid taxes, and there are no returns available.
MYTH: The recouping of paid taxes is interpreted as avoiding to pay taxes because upon reclaiming the overpaid taxes, a situation emerges as if the taxes weren’t paid anywhere.
Tax returns cannot be viewed as tax evasion. Not all, just overpaid income taxes are returned. And if the foreign country returns all overpaid taxes, this means that the income was not larger than unpaid income.
MYTH: To reclaim taxes, it is necessary to work abroad for several years.
It does not matter how long you may have worked abroad. If a person works even two weeks and paid taxes, the overpaid part is returned.
Tax reclaiming specialists remind that from January 1, it is possible to start filling in tax declarations and reclaim overpaid taxes in most foreign countries.
