Lithuania is a small Baltic country located in Northeast Europe with over 2.8 million people. Managing payroll and operations in Lithuania can be complicated, with mandatory health, social security, and income tax requirements. You need in-country bank accounts to begin paying employees, and must reserve your company name with the Register of Legal Entities.

Here are some labor and payroll considerations in Lithuania:

  • Employment contracts must be in writing, with form 1-SD submitted for new employees
  • Employers are required to register with the Social Security Fund Board
  • Both employers and employees must register with the local tax office
  • Employers must withhold income tax and social security contributions from employee pay
  • Foreign workers from non-EU countries must have a residence permit (national visa D) and a work permit to live and be employed in Lithuania
  • In accordance with the labor laws in Lithuania, payment of sickness benefits in accordance Sick-ness and Maternity are as follows:
    • Sickness benefits paid by the employer during the first two calendar days of absence due to illness will be paid up to 62%, but not more than 100% of the average earnings of the beneficiary calculated by the Government
    • The sickness benefit paid at the expense of the State Social Insurance Fund amounts to 62% of the recipient’s compensation wages
    • The sickness benefit for caring for a sick family member or for childcare paid from the State Social Insurance Fund is 65.94% of the recipient’s compensation wages

To simplify payroll and compliance, Blue Marble has created a cloud-based payroll solution with customized reporting so you can view your payroll in real-time, quickly pay employees in local currency, and track your costs across all countries and currencies. Our hybrid service model gives you a US-based team and direct access to in-country experts to ensure your questions are answered quickly. You can maintain control of your payroll process, view payroll in real-time, and ensure compliance with Blue Marble. Click here to learn more