In the previous article, we discussed the certification process established by the law “On State Support for the Information Technology Sector”, which is the main program of state support for the IT sector in Armenia. However, the Government of the Republic of Armenia taking into account the vulnerability of the IT sector in connection with events on the world market in 2022, expanded state support in the tech sphere by adopting decision No. 399-L.
MB Legal’s team answers frequently asked questions about the program.
What kind of state support is provided in the frames of this state support program?
Commercial organizations or individual entrepreneurs who attract 10 new employees will receive state support in the amount of 50 percent of the income tax paid in respect of new employees.
Who can apply for the state support?
Beneficiaries of this state support program can be commercial organizations in the IT sector, separate subdivisions of foreign legal entities registered in the Republic of Armenia, as well as individual entrepreneurs (hereinafter referred to as beneficiaries).
I am a beneficiary of the state support program established by the law “On State Support of the Information Technology sector” and have received a certificate: can I be a beneficiary of this state support program too?
No, business entities that have received a certificate per the procedure established by the law “On State Support of the Information Technology sphere” cannot be beneficiaries of this state support program during the certificate’s validity.
What conditions must be met to be a beneficiary of the state support program?
In order to be a beneficiary of state support the following conditions must be met simultaneously:
- 90 percent or more of the income from activities (sales turnover) is made up of classifiers of economic activities established by the order of the RA economy, and in the absence of income, 90 percent or more of the total number of employees is made up of professional personnel in the field of information technology,
- the number of employees engaged under employment contracts and civil law contracts for the performance of works or the provision of services for the corresponding month of state assistance has increased by at least 10 compared to the number of employees of this beneficiary according to the data taken into account as of March 1, 2022,
- newly hired employees during the 6-month period preceding March 2022 were not employees under civil contracts on labor and performance of works or provision of services in the Republic of Armenia,
- as of the day preceding the day of filing the application, they have no obligations on income controlled by the tax authority exceeding AMD 100,000, with the exception of income tax obligations, which must be fully fulfilled.
Which body provides the state support established by the program?
The state support (appoints and pays) provides Ministry of High-Tech Industry of the Republic of Armenia.
How long is the application being considered?
Ten working days after the submission of the documents, the Ministry examines all the documents, and if all the conditions are met, an agreement is concluded between the ministry and the beneficiary, after which 50% of the paid and calculated income tax is transferred to you.
What are the dates for applying for the state support?
The deadline for applying for state support is May 1, 2023.
Our team will be happy to help you taking advantage of the above-mentioned program of state support in the field of IT.
