Armenia Corporate Tax - Guide for International Expansion

Are you planning to expand your business to Armenia? Understanding the country’s corporate tax system is key to navigating its growing economy and ensuring full compliance with local regulations.

Armenia offers an increasingly attractive business environment in the Caucasus region, with competitive tax policies and a strategic location bridging Europe and Asia. Whether you’re establishing a new company or expanding existing operations, knowing how corporate tax works will help you plan effectively.

If you're looking for smart ways to manage international payments and handle cross-border transactions, we'll also show you how Wise Business can help simplify your financial operations in local currency.

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This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Wise Payments Limited, its subsidiaries or affiliates, and it is not intended as a substitute for obtaining business advice from a tax advisor or any other professional.

Armenia Corporate Tax Rate in 2025

The standard corporate income tax rate in Armenia is 18% for most businesses. This rate applies to the worldwide income of Armenian resident companies and to Armenian-source income of non-resident companies. Armenia’s rate is competitive within the region and aligns with many European countries.¹

However, Armenia offers preferential tax treatment for certain activities. From 1 January 2025 companies engaged in government-defined IT/high-tech activities and qualifying for the turnover tax regime may benefit from a 1% tax on turnover (gross revenue) rather than the standard profit tax.² Other certified IT startups may also qualify for additional tax incentives under Armenia’s state support programs.³

Corporate tax is levied on taxable profits under the general system (income minus deductible expenses). Companies under the general system should also consider that Armenia has introduced enhanced R&D-salary deductions.⁴

Read more about Corporate Tax Planning best practices

How to Pay Corporate Tax in Armenia

Corporate tax payments in Armenia are administered by the State Revenue Committee (SRC), which serves as the country's tax authority.⁵ Companies must register with the SRC and obtain a taxpayer identification number before commencing operations.⁶

Corporate taxes in Armenia are paid in Armenian drams (AMD). If your company's functional currency differs from AMD, you'll need to convert amounts using the official exchange rate set by the Central Bank of Armenia on the transaction date.

Armenian companies must file annual corporate income tax returns by April 20 of the year following the tax year. The tax year in Armenia runs from January 1 to December 31. Companies are also required to make quarterly advance payments based on the previous year's tax liability or estimated current year profits.⁷

Payment methods include bank transfers to designated government accounts, and larger companies may be required to use electronic filing systems. Late-payment interest and penalties apply under the State Revenue Committee (SRC) regime; companies should check the Tax Code and SRC guidance for the current daily rate.⁸

Let's consider a practical example: if your company has an annual turnover of £1.5 million (approximately AMD 750 million) with a profit margin of 15%, your taxable profit would be AMD 112.5 million. At Armenia's standard corporate tax rate of 20%, your annual tax liability would be:

AMD 112.5 million × 20% = AMD 22.5 million (approximately £45,000)

When expanding your business to Armenia, the right financial tools will make the process smoother. Using a platform like Wise Business makes it easy to manage international finances. A multi-currency account allows businesses to pay for incorporation costs, registration fees, and government taxes in local currency without paying high exchange rate fees.

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Tax Compliance in Armenia

Businesses and individuals must follow key tax and reporting rules to stay compliant with Armenia’s corporate tax policy.

Residency and Income Tax

Under the 183-day rule, anyone spending 183 days or more in Armenia during a year is a tax resident. Residents pay a flat 22% tax on worldwide income, including salaries, business profits, and capital gains.⁹ Non-residents are taxed only on Armenian-sourced income.

Social Security Contributions

Employees contribute 5% of their salary toward pensions, while the government adds 10%. Employers may owe additional social insurance payments.

Reporting and Filing

Tax residents must file annual returns by April 20. Businesses should maintain records and comply with transfer pricing rules, ensuring related-party transactions reflect market value to avoid fines.¹⁰

International Tax Compliance

Armenia has tax treaties with 35 countries, enabling foreign tax credits. Companies with foreign accounts exceeding USD 10,000 must file FinCEN Form 114 to report them.

Accurate documentation and updating Armenia’s corporate tax policy ensure smooth, penalty-free operations.¹⁰

International Expansion to Armenia

Armenia has recently grabbed the attention of investors looking to expand globally. Factors like a stable economy, favourable tax incentives, and broad access to major regional markets enhance the appeal of setting up a business here.

In 2023, the country’s GDP grew by 8.7%, driven by trade, construction, and a thriving ICT sector. With a GDP of USD 24.2 billion, Armenia’s services industry, especially tourism, continues to strengthen, making it the third fastest-growing economy in Europe.¹¹

Armenia’s investment climate is notably open to foreign participation. There are virtually no restrictions on foreign ownership, and business registration procedures are quite straightforward. Investors can register their businesses through a one-stop-shop system managed by the State Register Agency, receiving a registration number, taxpayer ID, and social payment account within days.¹²

The government has actively supported investors through trade and economic partnerships. Armenia is a Eurasian Economic Union (EAEU) member, granting access to a market of over one billion consumers with 0% or reduced customs duties. It also maintains Free Trade Agreements with countries including Vietnam, Singapore, Serbia, and Iran, and enjoys GSP regimes with the U.S., Japan, and several European nations.¹³

Armenia’s tax system is also attractive for expanding companies. The government offers generous exemptions from VAT, profit tax, and customs duties for businesses in border areas, healthcare, and export-oriented sectors. Large projects worth over AMD 2 billion (around USD 5 million) in the Tavush region receive extra tax benefits.¹³

If you plan to establish your business in this region, take the following steps:

1. Conduct market research to understand the local business environment.
2. Prepare a clear business plan aligned with your target market.
3. Choose your business location and legal structure.
4. Select and register your business name.
5. Register your business through the State Register Agency’s one-stop-shop system to obtain your registration number, taxpayer ID, and social payment account.
6. Open a local business bank account.
7. Set up proper record-keeping and compliance systems.

Acknowledge yourself with the Armenia corporate tax rate and work with an experienced corporate tax consultant to ensure you meet legal corporate obligations.

Discover the top 5 best Corporate Tax softwares

Incorporation of Business in Armenia

To incorporate a business in Armenia, you must register with the State Register Agency of Legal Entities. The process is straightforward and can be completed online via e-register.am using an Armenian e-signature. Provide the following documents:¹⁴

• Request form for company name: Reserves your business name to ensure it’s unique in Armenia.
• Statement on real beneficiaries: Declares the ultimate beneficial owners (UBOs) for AML compliance.
• Charter of the legal person (Articles of Association): Defines the company’s purpose, capital, and governance, approved by all founders.
• Founders’ decision: A resolution confirming the company's establishment, founder contributions, and appointment of directors.
• Application form (LLC): This is the official registration form containing company details such as name, address, activities, and share capital.
• Identification documents: Passports or national IDs of founders, directors, and authorised signatories.
• E-Signature and ID card reader: Required for digital submission and signing of incorporation documents.
• Agreement with the State Revenue Committee (SRC): Registers the company for taxation and issues a Taxpayer Identification Number (TIN).
• Application for employee registration: Filed when hiring staff to record them for tax and social security contributions.

Business Entity Types in Armenia

Armenia’s company law, governed by the Civil Code of Armenia and the Law on Business Entities, allows several types of business structures:¹⁵

• Private Entrepreneurship (PE): The simplest structure for individuals. The entrepreneur is personally liable for all obligations.
• Limited Liability Company (LLC): The most common business type. Shareholders’ liability is limited to their contributions, and an LLC may have up to 49 participants.
• Joint-Stock Company (JSC): A company whose capital is divided into shares.
  • Open JSC: Shares can be publicly traded.
  • Closed JSC: Shares are privately held among limited shareholders.

Once registered, businesses receive a state registration number, taxpayer ID, and social payment account.

International Corporate Tax Best Practices

Managing corporate tax obligations across multiple jurisdictions requires a strategic approach that balances compliance with efficiency. Here are key practices that can help international businesses navigate Armenia's tax landscape effectively.

Maintain comprehensive documentation of all business transactions, especially those involving related parties. Armenia's transfer pricing regulations require detailed documentation to support the arm's length nature of intercompany transactions. This includes maintaining local files and master files as prescribed by OECD guidelines.

Leverage double taxation agreements (DTAs) to minimise tax burdens. Armenia has signed DTAs with over 40 countries, including the UK, which can help prevent double taxation on the same income. These agreements often provide reduced withholding tax rates on dividends, interest, and royalties.

Consider the timing of income recognition and expense deduction to optimise tax efficiency. Armenia follows international accounting standards, but there may be differences between book and tax treatment that require careful planning.

Take the complexity out of international expansion with Wise Business

Researching corporate tax is a crucial step when expanding your business into a new country. The next step is setting up the financial infrastructure to handle the complexities of operating across borders, from managing multi-currency cash flow to mitigating FX risk.

The Wise Business account provides the financial tools to make your international expansion to Armenia efficient and simple. It's the one account for managing your money globally.

With a Wise Business account, you can:

• Pay suppliers and initial fees: Pay suppliers, global payroll, and one-off incorporation costs in the local currency.

• Get paid like a local: Use local account details for 8+ major currencies to easily receive payments from customers or investors.

• Manage your money across borders: Hold and exchange 40+ currencies in one account, always with the mid-market exchange rate and low, transparent fees.

• Streamline your accounting: Integrate with tools like Xero or QuickBooks to simplify tracking your company's international finances.

• Empower your team: Provide multi-user access for your finance team and issue expense cards for international spending.

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FAQs - Corporate Tax in Armenia

Who is liable for corporate tax in Armenia?

All Armenian resident companies are liable for corporate tax on their worldwide income. Non-resident companies are subject to Armenian corporate tax only on their Armenian-source income. A company is considered resident if it's incorporated in Armenia or if its place of effective management is in Armenia.

Are there any tax incentives for businesses in Armenia?

Yes, Armenia offers several tax incentives. IT companies can benefit from a 10% corporate tax rate and exemptions from profit tax on software exports. Companies operating in free economic zones may qualify for various tax benefits. Additionally, small businesses with turnover below AMD 24 million can opt for a simplified 1% turnover tax.

What is the tax treatment of dividends in Armenia?

Dividends paid by Armenian companies to residents are generally subject to 5% withholding tax. However, dividends paid to non-residents may be subject to different rates depending on applicable double taxation agreements. Some DTAs reduce this rate to 0% or 5% under certain conditions.

What is the process for registering for corporate tax in Armenia?

Companies must register with the State Revenue Committee within 15 days of incorporation or commencing business activities in Armenia. The registration process involves submitting incorporation documents, obtaining a taxpayer identification number, and selecting the appropriate tax regime.

What are the common pitfalls to avoid regarding corporate tax in Armenia?

Common mistakes include failing to maintain proper transfer pricing documentation, missing quarterly advance payment deadlines, incorrectly applying double taxation agreement benefits, and not properly converting foreign currency transactions to Armenian drams using official exchange rates. Additionally, companies should ensure they understand the distinction between accounting profits and taxable profits under Armenian tax law.

Sources used in this article:

1. PwC Tax Summaries: Armenia Taxes on Corporate Income
2. Armenian Lawyer: New 1% Turnover Tax for IT (2025 Implications)
3. PwC Tax Summaries: Armenia Tax Credits and Incentives
4. EY: Armenia Tax Alerts - March 2025
5. State Revenue Committee (SRC): Tax Information
6. E-Register: Armenia State Register of Legal Entities (Registration Portal)
7. PwC Tax Summaries: Armenia Tax Administration
8. SRC: Legal Acts and Information
9. Pebbles Day: Tax Residency - Armenia
10. Nomad Offshore Academy: Tax Guide Armenia
11. U.S. Department of State: 2024 Investment Climate Statements - Armenia
12. e-Regulations Armenia: Registration with the State Register of Legal Entities
13. Enterprise Armenia: Tax and Customs Incentives
14. Lawgratis: Business Law in Armenia
15. PwC: Guide to Doing Business in Armenia (PDF)
    Sources last checked 29/10/2025