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Online platform fees remain part of microbusiness taxable turnover
VID explains gross receipts, withheld commissions and payment timing for single-entry bookkeeping. A net bank credit alone does not capture the whole transaction.
By Taxxa AI OyPublished 6 August 2026
Industry: Across industries
A platform's withheld commission does not reduce turnover subject to Latvia's microbusiness tax.
VID VID's guidance on online transactions explains that the fee forms part of business receipts even where the platform deducts it before transferring the balance to the trader's account.
The distinction matters when the account statement shows only net receipts. The guidance treats the withheld amount as both business income and an expense. Under the microbusiness tax regime, expenses are not deducted from taxable turnover.VID Under the general personal income tax regime, the commission is recorded as income and as a business expenseVID, with the expense deductible in that regime.VID
VID illustrates the general-regime treatment with a €100 payment from a customer, a €3 platform fee and €97 transferred to the business account. The bank receipt and the withheld fee are separate elements of the bookkeeping entry.VID Recording only the cash received would omit the part of the transaction settled by the platform's deduction.VID
The guidance also distinguishes receipt timing by the payment arrangement. Where a system is directly linked to a bank card, it recognises income when money is received in that system. Where the system is not linked to a bank card, it recognises income when the funds reach the bank account.VID VID uses PayPal and Stripe as examples of those respective arrangements.VID
Single-entry bookkeeping follows the cash principle: income is recorded when received and expenses when incurred.VID Entries are supported by external or internal source documentsVID, and bank-account transactions can be recorded from account statements. Amounts in the journal are expressed in euros and cents.
For commissions withheld by the platform, VID requires an internal source document prepared under the Accounting Law.VID The guidance applies that documentation requirement to both personal income tax and microbusiness tax payers.VID It also explains why a permitted exemption from keeping the journal does not make a net-only payment statement sufficient to capture all data needed for calculating the tax.
The legal basis discussed is the Accounting Law, section 11, Cabinet Regulation No. 322 on single-entry bookkeeping and the Microbusiness Tax Law.
Reconcile gross receipts, platform fees and net transfers, retaining the required supporting document.