International Taxation

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International Taxation

In the course of globalization, our country signs bilateral interstate and intergovernmental international treaties, joins to the multilateral agreements: both economy and taxpayers are not able to follow them. The reasons are not only quick reforms, but also the complexity of newly formed relations. A vivid example is the membership of Armenia to the Eurasian Economic Union since January 2, 2015. We understand the importance of free motion of capital, goods and services, people and ideas from country to country, from region to region and we try to help investors, international organizations, and the government in those issues. Assessment of tax consequences of the international transactions and planning in accordance with RA laws and international agreements is one of the professional axis of our company.

Scope of field related natural and legal entities
  • subsidiary companies: direct investments, future financing schemes, taxation of dividends, repatriation
  • branches or representations: accounting with headquarter organization, share of expenses and incomes, fill-in of declaration in Armenia, reference on paid taxes, possibility of application of agreements on exclusion of double taxation

• reconciliation of accounting entries
• assistance in set-off of taxes paid abroad
• Consultancy on application of agreements on exclusion of double taxation combining with other economic agreements

  • Foreigners working in certain projects
  • Privileges of employees of foreign organizations
  • Passive income

Correlation of requirements of immigration and labour codes

  • Peculiarities of application of double taxation agreements of Armenia
  • Assistance in set-off of taxes paid abroad.
International taxation consultancy includes:

Observations of this kind are important for implementation of major investment projects. Main points are accuracy of tax consequences of foreign transactions from the point of Armenian national tax legislation and tax treaties. Problems usually arise in the application of international agreements and in such cases all components are examined: combination with national clause, international project budget lines, implementation of works under the nature and scope of the project, the accuracy of administrative information and preparation of tax reports, etc…

Tax consultancy on international transactions is most demanded among our international tax services, because local companies, even medium and sometimes small enterprises, also carry out transactions with foreign companies. Our consultancy refers to application of VAT 0% rate in Armenia, the mechanism and possibility to use the international treaty, the degree of complexity of document administration, taxes and custom duties paid at the border during import of goods into Armenia (including the leasing or those realized by factoring mechanism), specifics of transaction tax with entities in Eurasian Economic Union member states and so on.

Essential peculiarities are defined on tax declaration and related statements used by non-residents. This concerns especially the profit tax, as for other taxes it is necessary to take care of onetime package and registration system in advance reconciling it with the requirements of accounting legislation (e.g. accounting policy, the description of the projects implemented in RA, and preparation of materials with tax authority for determination of taxable profit in RA and choice of direct or indirect method for discussion, etc.).

“Paradigma Armenia” claims to be one of the leading organizations and centers in Armenia that can provide maximal and integral services on tax treaties in Armenian, English, Russian and French.

  • Information on tax treaties of RA on evasion of double taxation
  • Professional clarifications on clauses of OECD (Organization of Economic Cooperation Development) և UN (United Nations) model tax conventions
  • consultancy on the article of the treatywith a certain country
  • Extracts and/or analytical references according to the fields, income types, etc.
  • Application of tax treaties in certain transactions or invest projects

Existence of international informational database, as well as experience of services rendered to foreign legal entities operating in different spheres, afford an opportunity to extend activity field and, besides the tax and accounting services, enter the related sphere: that is application of other international economic treaties-investments, field regulations, agreements of free economic zone, Agreements of World Trade Organizations and other bilateral and multilateral agreements.

Within international consulting we find this more complicated and responsible, at the same time more interesting sector. The problem is that national tax legislation of Armenia, especially its administrative users are not ready to accept the institutes and tools used in international tax practice. Optimal scheme of the investments in Armenia and/or projects implementation includes numerous factors, comparison and combination of different transactions, in particular

  • planning usage of threshold norm terms defined by law and other opportunities keeping neutrality and optimality against business decisions
  • use of international tax agreements in the framework of business decisions neutrality and optimization
  • planning usage of threshold norm terms defined by law and other opportunities keeping neutrality and optimality against business decisions
  • combination / association of some economic agreements, some services, tax treaties of several countries for economy of tax and administrative expenses permitted by law taking into consideration customs of international business circulation and other restrictions.

Eurasian Economic Union provides free movement of products, services, capital and labor, as well as maintenance of systematic, coherent or consistent policy in the circumstances of united economy. The member states of European Economic Union are Republic of Armenia, Republic of Belarus, Republic of Kazakhstan, Kyrgyz Republic and Russian Federation.

“Paradigma Armenia” is specializing in the consultancy of the entrepreneurs of the member states of this organization, as well as participates in the consideration of issues, obstacles and regulations, as well as other normative acts in various platforms, including the platform of Advisory Committee of EEU Commission, the platform of the Union of Manufacturers and Businessmen of Armenia.

Special workshops are held on the application of EEU legislation, on customs, technical regulations, licenses and subsidies, application of indirect taxes, etc.)

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