We are pleased to present a brief overview of tax changes for HTP residents resulting from Presidential Decree № 4 dd. July 16, 2019.
6 month delay for VAT payment
Instead of the previous 12-month deferred payment of import VAT on technological equipment and spare parts imported to Belarus on which import duties are 0% (certain commodity items under the EAEU Unified Commodity Nomenclature, for example, computers and their blocks, parts, and accessories except for covers and cases (codes TN 8471, 8473), and terminals for electronic payment (code TN 8472), etc), HTP residents are entitled to apply for a delay in payment of import VAT for up to 6 months. The deferral is granted without any interest or other mechanisms to ensure proper fulfillment of VAT liabilities.
Reduced personal income tax rate on certain types of income
Prior to the adoption of Decree No. 4, personal income in the form of dividends received from HTP resident companies was subject to personal income tax at a 9% rate, in accordance with paragraph 32 of the HTP Regulation approved by the Decree of the President of Belarus № 12 dd. 22.09.2005.
Currently, if individuals have received dividend income beginning from January 1, 2019 and have withheld and paid income tax at the 9% rate, it is possible to apply preferential tax rates of 6% or 0%, as provided for in the Art. 214 (5, 6) of the Tax code of Belarus.
This made it possible for individuals, who are shareholders in HTP resident companies, to recalculate their personal income tax using preferential rates and offset the amount of tax on dividends accrued and paid beginning January 1, 2019.
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