LAW OF THE REPUBLIC OF ARMENIA

of December 30, 2016 No. ZR-261

About tax benefits of self-employed persons

Accepted by National Assembly of the Republic of Armenia on December 16, 2016

Article 1. This Law governs the relations connected with provision of tax benefits as regards the certain types of activity which are independently performed in the Republic of Armenia by physical persons, including individual entrepreneurs (further in sense of this law - self-employed persons), establishes procedure and terms of issue by tax authority of the certificate on tax exemption for application of tax benefits.

Article 2. Application of the tax benefits provided by this Law means that the self-employed persons corresponding to conditions, the stipulated in Article 3 presents of the Law, and performing only the types of activity established in Appendix 1, being integral part of this Law (further in sense of this Law, types of activity) according to this Law are exempted from the taxes which are subject to payment in the government budget of the Republic of Armenia as regards these types of activity, except for the value added tax and the excise tax which are subject to payment in customs or tax authorities.

Self-employed persons estimate and pay to customs or tax authorities the value added tax and the excise tax for commodity importation on the territory of the Republic of Armenia, and also the land tax and the property tax which are subject to payment in the local authority budget, according to the procedure and the terms established by the law.

Article 3. The tax benefits established by this Law are applied to those self-employed persons:

1) revenue of which for the previous calendar year from the delivered goods, the provided services and the performed works (except for the works performed as hired employee) on all types of activity (further - realization turnover) did not exceed 24 million dram;

2) which for implementation of the activities do not use work of other physical persons who are not individual entrepreneurs;

3) which are not agreement party about joint activities (except for productions of agricultural products);

4) activities of which (except for types of activity which do not take permanent place of activities depending on nature), are performed only on one place. In sense of this Law the residence of self-employed person is not considered the place if the types of activity established in Appendix 1, being integral part of this Law are not performed.

Article 4. To use the tax benefits provided in article 2 of this Law, the self-employed persons corresponding to conditions, the stipulated in Clause 3 Laws submit in tax authority in place of registration the application for receipt of the certificate on exemption of taxes and use of tax benefits (further - the statement). The application form and procedure for its filling establishes tax authority.

Self-employed persons submit the application for any period of activities (for any month or several months chosen within calendar year or for any calendar year, or calendar years) before implementation of type of activity or continuation of this type of activity. In the statement are surely filled:

1) name, surname, series and passport number and number of the social card (in the presence) self-employed person, identification taxpayer number (further - INN) person who is the individual entrepreneur;

2) activities period;

3) type (types) of activities, the location (except for the types of activity which are not taking permanent place of implementation of the activities).

Person who is not the individual entrepreneur in day of filing of application, is registered tax authority, and in the procedure established by the law and terms INN is provided to it.

Within one working day following behind day of filing of application, the tax authority provides to self-employed person, the certificate on tax exemption for application of tax benefits as regards the performed types of activity if it conforms to requirements, the stipulated in Clause 3 presents of the Law. The tax benefits established by this Law are applied since the month including date of filing of application by self-employed person.

Article 5. Self-employed persons who received the certificate on tax exemption in activities are not tax agents, and as regards these types of activity do not draw up tax accounts and can write out other settlement documents according to the procedure, established by the law.

In case of provision of services by the self-employed persons who received the certificate on tax exemption, to the organizations, the individual entrepreneurs who did not receive the certificate on tax exemption and to notaries as tax agents hold (levy) the income tax at source of receipt of the income in the general procedure established by the law.

The self-employed persons who received the certificate on tax exemption as regards types of activity do not submit the reports established by the law in tax authority (calculations, declarations, data).

Article 6. In case of excess of the threshold established in Item 1 of article 3 of this Law, within the current calendar year or any violation of the requirements stated in Items 2-4 of article 3 of this Law (including fixations of violation of the relevant requirement by tax authority according to the procedure, established by the law) as regards the types of activity performed by self-employed persons, the tax benefits established by this Law stop, and from this point taxes are estimated and paid according to the procedure, established by the tax legislation.

In case of violation of the conditions provided in Item 2 of article 3 of this Law, self-employed persons also bear the responsibility established by the law for the employer in lack of registration of hiring of the employee according to the procedure, established by the legislation of the Republic of Armenia.

The individual entrepreneurs who obtained the license for conducting activities with obligatory use of control cash registers in the Republic of Armenia bear the responsibility provided by the law in case of non-compliance with rules of use of control cash registers and cash calculations with use of control cash registers.

In case of registration of the fact by tax authority that the self-employed person who received the certificate on exemption of taxes is engaged in the type (types) of activities which is not specified in Appendix 1 to this Law the physical person from the moment of the beginning of these activities estimates and pays taxes in the general procedure established by the law.

Article 7. This Law becomes effective since January 1, 2017.

Appendix No. 1

to the Law of the Republic of Armenia "About tax benefits of self-employed persons"

The list of types of activity in which implementation tax benefits for self-employed persons are established

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