Taxes in Armenia
Updated on Thursday 03rd May 2018
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1. What is the corporate tax in Armenia?
Armenia has a corporate tax of 20% on taxable profit earned by legal entities. The profit tax return must be filed before 15 April of the following year.
2. What is the VAT in Armenia?
The VAT in Armenia is 20%. Some transactions in different areas are subject to exemption from VAT in Armenia, such as the providing of goods and services related to humanitarian assistance and charity, sales of newspapers and magazines, some specific financial operations and transactions carried out by banks and lending bodies, tuition for secondary, professional, and high schools, education material, sales of veterinary medicines, chemicals used in agricultural production, agricultural plants and seeds, fertilizers, services related to the care of children , insurance and reinsurance operations, operations related to pension insurance.
The VAT can be paid monthly or quarterly, according to preferences. The choice has to be stipulated at registration.
3. How can the VAT be refunded in Armenia?
In case of exporters, there is a VAT refund on goods and services exported. However, the procedure required for applying in order to receive a VAT refund is quite complicated and therefore it can hold you back.
4. What is the dividend tax in Armenia?
When it comes to dividends, the recipients, whether they are from Armenia or not, do not have to pay dividend tax. Anyhow, there are some exceptions for non-residents of Armenia, when the dividend tax is withheld at the source.
5. What are the taxes rates applied on other payments?
Interests and royalties are taxed with 10%, but just like in the case of the dividends, exemptions may be granted based on different signed agreements.
6. Are there any incentives for foreign investors in Armenia?
In order to encourage foreign investments, the government of Armenia has gone through several reforms in economy and infrastructure. Besides, Armenia offers low labor costs and a stable banking system as incentives for foreign affairs. Recently, foreign investments have been focused on transportation and telecommunication, food, retail, mining and engineering, as well as in power and utilities.
The foreign investors are paying taxes only if the earned income is provided by activities performed in Armenia or if the payer of dividends, interests, royalties, insurance and financial services is a resident in Armenia.
The corporate profit or the passive income may be exempt from taxes if the beneficial country gas signed a double tax treaty with Armenia.
7. Why do I need a local accountant for my business in Armenia?
The tax system in Armenia is rather complex and might change in short notice, therefore it is recommended to have a local accountant that is up to date each time law changes. It is more efficient to count on a local specialist, since the experience with the Armenian law is quite important in getting used to the system.
BridgeWest is also able to offer ready-made Armenian companies and VAT registration.
Please contact us for more information and prices.