Transfer Pricing Initiative

The draft regulation on Transfer Pricing developed by the State Revenue Committee addresses several issues previously raised by the Investment Council of Armenia and discussed during the Sub-Council meeting.

Resolved issues include:

• A list of countries (or geographic areas) with special preferential tax regimes has been established. Previously, in the absence of such a list, businesses had to determine on their own whether their partner's country qualified as preferential.
• In cases where more than 80% of a taxpayer’s business income or expenses arise from transactions with a single partner, the reporting obligation will now apply only to the taxpayer, and not to the counterparty.
• The threshold for the obligation to submit transfer pricing documentation has been increased from AMD 200 million to AMD 600 million.
• The deadline for submitting reports under the Transfer Pricing framework has been postponed from April 20 to June 30.
• Instead of a single uniform penalty for failure to submit documentation on time, differentiated penalties have been introduced, based on the size of the business.