Starting from December 1, 2023, the tax code of the Republic of Armenia will undergo certain modifications concerning the taxation of non-transparent real estate rental transactions, as reported by NEWS.am.

The news agency states that failure to comply with the tax code requirements regarding the rental of non-transparent real estate will result in a fine of 5 percent of the property’s market value, determined through official appraisal, with a maximum limit of 500,000 drams.

If a repeated violation occurs within a year, a fine of 10 percent will be imposed, not exceeding one million drams.

However, the committee clarifies that this penalty does not apply under two circumstances: when the taxpayer’s rights involved in the non-transparent real estate rental transaction have been registered with the state or when the taxpayer’s rights involved in the rental transaction have not been registered, but the tax on the income derived from the rental of non-transparent real estate has been calculated according to the provisions of the tax code established by the official appraisal.

It should be noted that in the absence of state registration of taxpayers’ rights involved in non-transparent real estate rental or failure to register a fine announcement in accordance with the tax code provisions, the calculation of tax liability for the rental income of non-transparent real estate or the fine announcement related to non-transparent real estate rental cannot serve as a valid basis for recognizing the taxpayer’s rights or the validity of the rental transaction.

Source: News from Armenia – NEWS.am