One of the most positive aspects of Lithuania's 2011 budget legislation is the revision to the Law on Immovable Property Tax. For the purposes of tax calculation, it allows an individual valuation based on the impairment of immovable property value, rather than a mass valuation of the property. This allows companies to respond to ongoing market fluctuations by reducing the taxable base value of their property, which is a significant factor in improving the business environment. The amendments include provisions on:

  • the identity of the taxpayer;
  • tax benefits for property under public-private partnership;
  • determination of taxable value; and
  • tax calculation.

The immovable property tax on acquired real estate (under a financial lease contract that provides for the transfer of title, or an instalment-based purchase and sale contract or hire-purchase contract) is paid by the party that acquires the property, not the formal owner (eg, not by a leasing company), provided that the information on the property in question is publicly registered.

Real estate in which an interest is created or acquired through public-private partnership (eg, through a concession arrangement), and which is used in accordance with its contractual purpose, is not considered a taxable object for these purposes for the duration of the contract.

Requests to assess a property on the basis of individual valuation may be filed during every tax period (within three months of the beginning of such period), irrespective of whether a new mass valuation of the property has been carried out. Such requests will be considered if the taxable value of the property differs by at least 20% from that determined by individual valuation.

Legal entities may stop calculating tax from the month during which:

  • title to a property is transferred;
  • title to an acquired immovable property is assigned or lost; or
  • a property is returned to a former title holder.

Natural persons may stop calculating tax on a property from the month during which they cease to use it for economic or personal use.

For further information on this topic please contact Vitas Vasiliauskas or Gintaras Balčius at LAWIN Lideika Petrauskas Valiūnas ir partneriai by telephone (+370 5 268 1888), fax (+370 5 212 5591) or email ([email protected]).


(1) Law on Amendments and Supplements to Articles 2 to 4 and 6 to 12 of the Law on Immovable Property (145 -7415; 154).