06/07/2021
🧐Are you aware of the new tax updates? We have brought something new for you!
🟢 TRADE-IN IN ARMENIA
✅The Trade-in system have been introduced and will be inforce in Armenia from January 2022. The RA Law on “Trade and services" defines the concept of Trade-in for the purchase of a motor vehicle (incl. agricultural machinery) as a commercial acquisition of a vehicle (incl. agricultural machinery) by a car manufacturer's distributor or dealer from an individual whom the car belongs to, implementation of a retail sale of a vehicle (incl. agricultural machinery) by a car manufacturer's distributor or dealer to an individual during which the refund of part of the sales price is carried out by a motor vehicle (incl. agricultural machinery) purchased from the individual.
✅Trading activities for the purchase of motor vehicles (incl. agricultural machinery) are subject to licensing at the following annual rates of state fee:
- From January 1, 2022, in the amount of 1000 times the basic fee, that is 1,000,000 AMD
- From January 1, 2023, in the amount of 2000 times the basic fee, that is, 2,000,000 AMD.
✅VAT provisions related to Trade-in
In case of sales of a motor vehicle by an organization that is considered as a VAT payer and has a license to Trade in, the VAT base is the positive difference between the VAT tax base calculated for further sales of a vehicle (incl. agricultural machinery) and document-based purchase price of a vehicle (incl. agricultural machinery) in case the vehicle is purchased from a natural individual who is not an individual entrepreneur and a notary, and is sold to a natural individual who again is not an individual entrepreneur and a notary.
✅PIT provisions related to Trade-In
Income received from the sales of a motor vehicle (incl. agricultural machinery) from an organization that is considered as a VAT payer and has a license to Trade in for the purchase of a motor vehicle (incl. agricultural machinery) owned by it on the right of ownership is not subject to taxation of income tax, except in such cases when the income is formed from the sales of a vehicle (incl. agricultural machinery) that is subsequently submitted to the state register by that company.
