Armenia Tax Regimes 2026 — Complete Guide

Table of contents

• Three tax regimes: brief overview
• Microbusiness — 0% tax
• Turnover tax (simplified tax system — STS)
• General tax system (GTS) — for larger businesses
• Tax tables by business type
• Payroll taxes
• Non-resident tax. Paying foreign contractors?
• Need help choosing a tax regime?

Armenia has three tax regimes. Which suits you depends on your type of activity and turnover.

If you have already selected your activity type in the economic activity type finder and registered a sole proprietorship or LLC in Armenia, you have 20 days from the date of registration to apply for one of the preferential tax regimes. Otherwise — the general system applies automatically.

Once a year — from January 1 to February 20 — you must file an application to choose your tax regime for the current year.

Three tax regimes: brief overview

Microbusiness — 0% tax

This is a special regime exempt from taxes; only the military fee is paid. There are restrictions on activity types and turnover.

Conditions

Turnover for the previous tax year across all activities does not exceed 24 million AMD (~62,000 USD).

To confirm whether your activity qualifies for micro regime, consult an accountant: the list of permitted activities has nuances. There is also a list of sectors that clearly do not qualify. Read more in the microbusiness article.

Turnover tax (simplified tax system — STS)

This is a special regime where the main tax is calculated on turnover, and the profit tax is replaced by a fixed minimum payment. Less paperwork and simpler calculation than under the general system. The regime is split into several rates by the main turnover tax.

Although the profit tax is replaced by a fixed payment, it is often still called “profit tax.” Legally that is not entirely correct. For simplicity, we will use this term as well.

Conditions

• The enterprise’s activity is on the permitted list (see below)
• Turnover for the previous year does not exceed 115 million AMD (~290,000 USD)
• If the enterprise used STS but annual turnover exceeded 115 million AMD, then from the quarter of that excess it must pay taxes under the general system (GTS).

Taxes under STS

• Turnover tax — 1–12% (rate selection explained below)
• Military fee — 12,000 to 120,000 AMD/year (depends on turnover)
• Social fund contribution (fixed) — 60,000 AMD/year
• Profit tax (fixed) — 60,000 AMD/year
• Health insurance (fixed) — 129,600 AMD/year (if turnover in 2025 exceeded 2.4 million AMD)

Fixed taxes do not depend on turnover but are not charged for months when the sole proprietorship was suspended or closed by application.

STS rates by activity type

Tax is calculated on turnover but may be reduced by documented expenses. The tax may not be lower than the minimum percentage of turnover.

Tax Code art. 285 — law text

General tax system (GTS) — for larger businesses

This is the standard tax system and applies automatically when registering a sole proprietorship or LLC. Sometimes called “standard system” or “VAT system.” Advantageous when expenses are high — you pay only on the difference between income and expenses.

This system is mandatory if turnover exceeds 115 million AMD or by choice.

Taxes under GTS

• Profit tax — 18%
• VAT — 20% (VAT on expenses can be deducted)
• Dividend tax — 5% when withdrawing profit from an LLC
• Additional taxes depending on activity, e.g. environmental levy or quarterly profit tax.

Tax tables by business type

Sole proprietorship on simplified system (STS)

If you have employees — pay payroll taxes monthly.

Fixed taxes do not depend on turnover and are not charged for months when the sole proprietorship was suspended/closed by application.

LLC on simplified system (STS)

If you have employees — pay payroll taxes monthly.

Sole proprietorship on general system (GTS)

If you have employees — pay payroll taxes monthly.
Advance adjustment: if the previous year’s return is filed before the quarterly advance deadline — the actual amount applies.
Excess advances: overpayments may be credited to future payments or refunded as set out in the Tax Code (credit is more common in practice).
Advance obligation: mandatory for all taxpayer entities (except special cases under the Tax Code).

Fixed taxes do not depend on turnover and are not charged for months when the sole proprietorship was suspended/closed by application.

LLC on general system (GTS)

If you have employees — pay payroll taxes monthly.
Advance adjustment: if the previous year’s return is filed before the quarterly advance deadline — the actual amount applies.
Excess advances: overpayments may be credited to future payments or refunded as set out in the Tax Code (credit is more common in practice).
Advance obligation: mandatory for all taxpayer entities (except special cases under the Tax Code).

Sole proprietorship on micro regime

If you have employees — pay payroll taxes monthly.

Fixed taxes do not depend on turnover and are not charged for months when the sole proprietorship was suspended/closed by application.

LLC on micro regime

If you have employees — pay payroll taxes monthly.

Payroll taxes

If you have employees, you withhold from their salary and remit to the budget monthly:

Income tax on salary

Social contribution on salary

Mandatory for employees born after January 1, 1974. Those born before 1974 may participate voluntarily.

Military fee (stamp duty) on salary

Why is the fee lower for salaries under 1 million AMD than last year? We assume the state offsets the lower military fee because such employees already pay health insurance (10,800 AMD).

Art. 12 — law text

Mandatory health insurance (MHI) on salary

From January 1, 2026, Armenia has a universal mandatory health insurance system that makes healthcare more accessible to citizens. MHI premium cost is an additional burden on business.

The employer withholds from salary and remits to the budget.

Non-resident tax. Paying foreign contractors?

If you pay for services from a company or individual in another country, you may be required to pay non-resident tax.

Rate: 20% of the payment amount.
Deadlines: by the 20th of the month following the month in which payment to the non-resident was made (per bank)

Check whether there is a double tax treaty with that country — list

If there IS a double tax treaty

You do not pay non-resident tax.

1. Request a tax residency certificate from the contractor for the current year. If payment was in 2026, the certificate must be for 2026.
2. The certificate must reference the double tax treaty between the countries

With countries WITHOUT a double tax treaty

You pay non-resident tax.

The non-resident contractor pays tax in their country, and you pay in yours, so the amount is taxed twice. For example, when working with the USA, Turkey, Azerbaijan, offshore jurisdictions (Hong Kong, Taiwan, Macau) etc., tax is paid in any case.

Tax residency certificate

This is a document confirming that the contractor is a tax resident of another country. As a rule, the certificate is requested from the tax authority where the non-resident is located. It can often be requested remotely through the taxpayer’s online portal.

Note that this is not a certificate of company registration or tax registration; it is a separate document requested additionally from the tax authority and issued on the basis of the treaty, for example between Georgia and Armenia.

The certificate is issued to companies, sole proprietors, self-employed persons or freelancers. If the non-resident you pay for services is an individual and does not pay tax — you will have an obligation to pay non-resident profit tax.

Need help choosing a tax regime?

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• choose the most advantageous regime for your business
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👉 Go to EasyTaxes tax regime calculator