What are the IT support measures in Armenia?

Armenia supports the development of the IT sector at the legislative level. In 2014, the law "On state assistance in the field of information technology" was adopted. For IT business there are tax benefits:

• The income tax rate is reduced from 20% to 0%;
• VAT is reduced from 20% to 0%;
• The tax rate on the wages of employees (at least one) is reduced from 23-36% to 10%;
• 5% income tax (PIT) on dividends.

Not all IT companies are eligible for tax incentives. Only companies that are engaged in:

• Software development;
• Creation of databases, websites, content, technical instructions;
• Consulting activities in the field of IT;
• Computer systems management;
• Data processing, placing databases on the network;
• Actions related to web portals and search engines;
• Educational and research IT programs.

In addition to a certain area of activity, the company must:

• Have a staff of no more than 30 people;
• Have a legal address:
• Have active bank accounts (the movement of funds must be visible);
• Be registered less than 3 months ago.

To pay taxes at reduced rates, a company must be certified.

In order to be certified to operate, a company must:

1. Register on the territory of Armenia;
2. Open an account in an Armenian bank;
3. Develop a business plan;
4. Apply. Documents are sent in paper form to the certification commission under the Ministry of Economy of Armenia.
5. Full-time defend your project before the commission;
6. Get a positive response from the commission;
7. Submit information about the certificate to the tax office;
8. Once every 6 months, report to the Ministry of Economy on the implementation of the business plan.

The decision of the commission will be negative if you do not meet the requirements from the previous paragraphs.
There are other reasons too:

• applied late;
• engage in activities other than those permitted;
• previously lost the certificate;
• the owner of the company or another person who makes the decision has already violated the requirements of the law;
• company - a subsidiary of another legal entity;
• the company is formed by reorganization of another legal entity.

For the same reasons, the Ministry may revoke a certificateif it reveals violations after the issuance of the document.

Important!

Tax credits can only be used on income earned abroad.

Information sources: Law "On state assistance in the field of information technology"