January-May 2013 In this issue: Government decrees: - Temporary disability benefits - Registration of VAT payers Armenia and the Republic of Serbia on Double Taxation Armenia and the Federal Republic of Germany Armenia and the Republic of Iraq Armenia and the Kingdom of Bahrain Orders of the RA State Revenue Committee: - Submission of tax returns - Notification form for the application of trade discounts - Turnover tax returns - Instruction on the Calculation and Payment of Income Tax Official Clarifications of the State Revenue Committee: - Recognition of income from the alienation of immovable property - Taxation of vacation payments - Instruction on the calculation of salary in certain cases
2 Government Decrees Temporary disability benefits Pursuant to Article 25, part 6, and Article 29 of the RA Law on Income Tax, the RA Government adopted Decree No. 144-N of 21 February 2013, determining the specifics involved in computing average monthly salary for purposes of calculating temporary disability benefits and the procedure for payment of those benefits. The decree applies to relations arising after 1 January 2013. (Published in Official Journal, no. 12 (952), 28 Registration of VAT payers The RA Government adopted Decree No. 336-N of 28 March 2013, supplementing Government Decree No. 1104-N of 4 August 2011 on the Adoption of a Registration Procedure for VAT Payers. According to the supplements: - Persons whose revenue for the preceding calendar year, as declared in turnover tax returns and/or VAT returns, profit tax returns or income tax returns etc., exceeded AMD 58.35 mln do not need to submit a notification form to the tax authorities in order to become a VAT payer and use a VAT payer s identification number; - If a person is not regarded as a VAT payer or has not submitted a notification to become a VAT payer, but was registered as a VAT payer by the tax authorities, such VAT payer should be deregistered based on an application from the taxpayer. (Published in Official Journal, no. 20 (960), 17 April 2013) Republic of Armenia and the Republic of Serbia on Double Taxation RA Law on International Agreements, the RA Government adopted Decree No. 75-A of 31 January 2013, giving consent to the offer for signing the Convention between the Republic of Armenia and the Republic of Serbia for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital. Republic of Armenia and the Federal Republic of Germany Law on RA International Agreements, the Government adopted Decree No. 253-A of 21 March 2013, giving consent to the offer for concluding the Convention between the Republic of Armenia and the Federal Republic of Germany for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital. Republic of Armenia and the Republic of Iraq RA Law on RA International Agreements, the Government adopted Decree No. 447-A of 2 May
3 2013, giving consent to the offer for concluding the Convention between the Republic of Armenia and the Republic of Iraq for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital. Republic of Armenia and the Kingdom of Bahrain RA Law on RA International Agreements, the Government adopted Decree No. 449-A of 2 May 2013, giving consent to the offer for concluding the Convention between the Republic of Armenia and the Kingdom of Bahrain for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital. Orders of the RA State Revenue Committee Submission of tax returns adopted Order No. 445-N of 26 December 2012, amending the contract template for online reporting. According to the amendment, in the absence of an Internet connection or in the case of software failures, taxpayers are to submit tax returns to the tax authorities in hard copy, except for monthly income tax returns and new employee application forms. Notification form for the application of trade discounts In accordance with Article 8, part 6, of the RA Law on VAT, the RA State Revenue Committee adopted Order No. 10-N of 11 January 2013, introducing the notification form for the application of trade discounts stipulated by public agreements and the instruction on its completion. (Published in Official Journal, no. 7 (451), 1 March 2013) Turnover tax returns adopted Order No. 25-N of 23 January 2013, introducing the quarterly turnover tax return form and the instruction on its completion. Instruction on the Calculation and Payment of Income Tax adopted Order No. 22-N of 21 January 2013, amending the Instruction on the Calculation and Payment of Income Tax in order to bring it into compliance with recent changes in the Law on Income Tax. Official Clarifications of the State Revenue Committee Recognition of income from the alienation of immovable property, together with the RA Ministry of Finance, issued Official Clarification No. 30 of 21 December 2012 on the specifics involved in recognizing taxable income from the
4 alienation of buildings, structures (including incomplete and unfinished), and residential or other premises (hereinafter, immovable property ) in cases when: - the land under immovable property is alienated along with the immovable property but the prices for land and immovable property are not separated in the contract; - the land under immovable property is alienated along with the immovable property and the prices for land and immovable property are separated in the contract; - other land is alienated along with the immovable property and land under it, and the prices for that land and immovable property are not separated in the contract., together with the RA Ministry of Finance, issued Official Clarification No. 2 of 25 January 2013 on several issues involved in salary calculation. The clarification concerns approaches that will be taken into account to bring 2013 salaries into line with 2012 salaries after the implementation of the new Law on Income Tax in cases when (i) an employee s salary or part of it in 2012 was calculated as a percentage of remuneration received for work or services performed or (ii) there have been changes in an employee s workload. (Published in Official Journal, no. 7 (451), 1 March 2013) (Published in Official Journal, no. 3 (447), 1 Taxation of vacation payments In order to avoid any confusion in connection with the application of the new Law on Income Tax, the RA State Revenue Committee, together with the RA Ministry of Finance, issued Official Clarification No. 1 of 11 January 2013 on the tax treatment of vacation payments when a vacation started in 2012 and continued into 2013. (Published in Official Journal, no. 3 (447), 1 Instruction on the calculation of salary in certain cases
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