Income tax for employees in scientific research and experimental development programs reduced to 10%
In Armenia, the income tax rate for employees involved in Scientific Research and Experimental Development (R&D) programs has been set at 10% instead of the previous 20%.
Within the framework of the new law, organizations can also utilize an accelerated depreciation mechanism for fixed assets acquired under R&D programs, allowing for a faster return on investments.
Additionally, when calculating corporate income tax for the salaries of employees engaged in R&D programs, organizations can benefit from an additional 200% deduction. Furthermore, certain transactions are exempt from VAT (Value Added Tax), and expenses incurred on R&D activities reduce the corporate income tax base.
If a researcher simultaneously benefits from other income tax refund programs, such as the mortgage interest tax refund, it does not interfere; the employee will benefit from both the 10% preferential rate on their salary and the mortgage tax refund.
To date, 80 R&D programs have been implemented across 67 organizations, with the 10% income tax rate already applied to approximately 900 involved employees.