Is your company ready for the upcoming changes?

From January 1, 2026, the minimum monthly wage (MMA) in Lithuania will increase.
For employees – this is good news. For businesses – it is essential to review budgets, employment contracts, and salary systems in advance.

To ensure a smooth transition, it is important to understand how this change affects your accounting and financial planning.

How much will the minimum monthly wage increase?

According to the Government’s planned decisions, from January 1, 2026, the minimum monthly wage (MMA) will be €1,153 (gross), and the minimum hourly rate will be €7.05 (gross). This represents an increase of about 11% compared to 2025.

It is worth following precise data on the VMI and Sodra websites – they are the first to update information on new rates and contributions.

What does this change mean for businesses?

When the minimum wage increases, it affects more than just salaries:

the wage fund and social security contributions increase;
employment contracts and accounting systems need to be updated;
some salary calculation parameters change (e.g., vacation pay, overtime);
the salary threshold that determines per diem taxation also changes – from 2026, this threshold will be €1,902.45 (MMA × 1.65);
the company budget must be adjusted in advance.

With proper preparation, these changes become an opportunity to optimize processes and avoid errors.

How will the increase in minimum wage affect per diem taxation?

The increased minimum wage also impacts business trip per diem taxation thresholds.

According to current regulations, non-taxable per diem amounts depend on the employee’s set salary compared to the minimum monthly wage:

If the salary specified in the employment contract is equal to or higher than MMA × 1.65 (i.e., from 2026 – at least €1,902.45 gross), then per diems not exceeding the established limits are non-taxable under GPM.
If the set salary is lower than MMA × 1.65, then only up to 50% of the employee’s monthly salary is non-taxable – any excess is treated as employment-related income and taxed.

The maximum per diem rate for business trips within Lithuania remains €28 per day.

Therefore, when planning budgets for 2026, businesses should consider whether employee salaries will reach the MMA × 1.65 threshold – as this determines whether additional taxes will be required on per diems.

3 steps to help you prepare for the changes:

Evaluate your company’s situation – review how many employees receive minimum wage or salaries close to it – this will help assess the real impact of the change.
Recalculate the payroll budget – include increasing costs in planned budgets and financial forecasts. This step is especially important for small and medium-sized companies, where the increase in minimum wage may have a larger relative impact.
Update documents and accounting – check whether all employment contracts, contract appendices, payroll calculators, and accounting systems align with the new rates.

An Increasing minimum wage – not just a cost increase, but an opportunity to:

better evaluate your company’s compensation system;
strengthen relationships with employees;
show that you care not only about numbers but also about your team.

Clear, open communication with your team builds trust – and trust builds a strong business.

UAB “Germalita Accounting & Consulting” – when numbers become peace of mind

Our team works with businesses of all sizes – from small companies to large organizations.
UAB “Germalita accounting & consulting” provides accounting and bookkeeping services that help you plan your future with confidence.

We will take care of:

recalculating salaries according to the new MMA;
updating employment contracts and documentation;
practical advice on how to manage expenses and taxes more efficiently.

Our goal is simple – to let you focus on business growth while we handle your accounting.

Prepare for 2026 together with UAB “Germalita Accounting & Consulting”

Changes are inevitable, but preparation is in your hands.
If you want the increase in minimum monthly wage to be clear, organized, and stress-free for your business – contact us.

+370 5 203 1024
info@germalita.com

UAB “Germalita Accounting & Consulting” – a reliable accounting partner for your business.