Lithuania Country Guide 2022

Lithuania

The Republic of Lithuania is a country in the Baltic region of Europe, with almost medieval-looking cities and beautiful nature. It has a abundant public transportation, happy people and is very affordable and safe to live in. The Lithuanian people can be quite reserved; however, once they open up they are very welcoming  – Lithuania has over 60,000 foreigners from all over the world living in the country.

Thanks to the country’s growing economy, more and more jobs are being opened to locals and foreigners alike, from Fintech to tourism. Lithuania has an excellent healthcare system, dynamic work culture and a healthy work-life balance.

  • Capital: Vilnius
  • Spoken Languages: Lithuanian
  • Currency: Euro (EUR)
  • Minimum monthly wage: EUR 730 (Gross)

Entry Visa

Citizens of EU/EFTA Member States and Switzerland can enter Lithuania with an identity card or a valid passport; other foreign citizens may enter with a valid Schengen visa.

Work Permit / Residence Permit

Citizens of EU/EFTA Member States and Switzerland can live and work without a work or residence permit in Lithuania.

Other foreign nationals must apply for a Work Permit, and a visa to enter and stay in Lithuania. Application for the work permit is done by the employer; after it is received, the employee must apply for a National Visa at a Lithuanian consulate. When both visas are received, the individual may enter Lithuania and start working.

Instead of a national visa, some employees may apply for a temporary residence permit instead; however, those are generally only issued for professions that are scarce in Lithuania or employees who will earn more than 1.5 of the average wage in Lithuania.

Social Security Registration

All individuals working in Lithuania should register with the Social Security Authorities (SODRA) and receive a Social Security Number (SSN).

Working Hours

A standard working week in Lithuania is 8 hours/day, or 40 hours/week. However, it is common to have shorter workdays on Fridays, with employees leaving as early as 3:30.

No more than 8 hours overtime is allowed for any 7 consecutive working days, and overtime is paid at 150% normal rate, which  increases to 200% during the night or on a rest day.

Public Holidays

  • 01 January (New Year’s Day)
  • 16 February (Day of Reestablishment of the State of Lithuania)
  • 11 March ( Day of Reestablishment of Lithuania’s Independence)
  • Easter Monday (Not a standard date, usually March/April)
  • 01 May (International labour Day)
  • 24 June (Rasos and St. John’s Day)
  • 06 July (Day of the State (Coronation of King Mindaugas))
  • 15 August (Assumption Day)
  • 01 November (All Saint’s Day)
  • 02 November (Commemoration of all the Faithful Departed (All Souls’ Day))
  • 24 December (Christmas Eve)
  • 25 December (Christmas Day)
  • 26 December (Christmas)

Vacation Allowance

The standard amount of annual leave in Lithuania is 20 days (24 for a 6-day week); after 10 years with the same employer, and extra 3 days is added, and an additional day is accrued every 5 years after that.

Annual leave for the first working year is generally granted after 6 months of continuous employment. One installment of annual leave may not be shorted than 10 working days (12 for a 6-day week).

Sick Leave

Employees in Lithuania are entitled to paid sick leave, the duration of which is dependent on the type of illness. The employer is responsible for paying the first two days of sick leave at a rate of 62.06% – 100% of the employee’s average monthly salary; the rest is covered by the Social Security Authorities  (SODRA) at a rate of 62.06% monthly salary. Some employers may top up SODRA’s contributions to make up the full salary.

Maternity / Paternity leave

  • Maternity: 70 days prior to the birth, and 53 after (an extra 14 days for multiple births). Maternity benefit is equal to 77.58% of earnings.
  • Paternity: 30 calendar days after the birth of the child. Benefit is equal to 77.58% of earnings.

Termination & Severance

After termination of employment, an individual is entitled to severance pay; the amount is dependent on the length of the employment.

Length of EmploymentSeverance Pay
< 1 year0.5 to 1 Month’s Salary
> Year2 Months’ Salary

Notice Period

The standard notice period for an employer is 1 month; if employment lasted less than a year, this is shortened to 2 weeks.

The notice period for an employee is 20 days; this is reduced to 5 days if the employee is resigning for an important reason.

Social Security

Employee social insurance contributions are deducted automatically from the wage, while employer contributions are paid by the employers themselves.

CategoryEmployer (%)Employee (%)
Unemployment *1.31% (2.03%*)0%
Accident coverage0.14%0%
Guarantee Fund0.16%0%
Long-term employment benefit0.16%0%
Pension0%8.72%
Sickness0%1.99%
Maternity0%1.81%
Pension Accumulation 3% **0%3%
Total1.77% (2.49%)12.52% (15.52% **)

* If an employee is on a fixed-term employment contract, the unemployment contributions rise to 2.03% from 1.31%.

** Employees may opt in to the pension scheme to build a reserve for retirement by transferring 3% of their monthly wage  to a private pension fund.

Pension

In Lithuania, an individual is entitled to a state social insurance old age pension provided they have reached the statutory retirement age, and has paid 15 years’ worth of Social Security contributions.

Taxation

The Lithuanian fiscal year runs from January 1 to December 31.

Tax Rates

The following progressive rates apply for 2022.

Taxable Income (EUR)Total Rate (%)
0 – 90,24620%
90,247 +32%

Tax Returns

The annual income tax return does not need to be filed by individuals whose only income is based on an employment salary.

Double Taxation

Lithuania has tax treaties with multiple other countries, which can reduce payable tax on certain incomes. It is also possible to obtain tax relief in Lithuania to avoid double taxation on the same income.

Health Insurance

Even though Lithuania has a good public health system, including dental health care, many companies offer employees private health insurance for additional coverage.

Cost of Living

The cost of living in Lithuania is on the lower side for Europe. The estimated monthly cost for a single person is around EUR 1,000 – 1,200, with 400 – 600 going to rent.


How We Can Help

We provide a full set of services in Lithuania allowing corporate clients, recruitment agencies and professional contractors to operate in an optimal manner while ensuring that all local employment obligations are taken care of.

Access Financial offers the following solution in Lithuania:

  • Self-Employed Solution

If you would like to discuss how Access Financial can help in Lithuania, please contact us.

Disclaimer

WE HAVE PREPARED THIS AS A GUIDE ONLY; IT DOES NOT FORM PART OF AN OFFER. PLEASE REQUEST ILLUSTRATIONS BASED ON YOUR SPECIFIC CASE FROM ONE OF OUR SOLUTION MANAGERS.