Regulatory updates affecting business in January – March 2020

We are pleased to present a brief overview of the main regulatory changes affecting the business environment in Belarus in January – March 2020.

Minimum salary and basic value

As from January, 1st, 2020:

• Minimum monthly salary is set at the amount of 375 BYN (Regulation of Council of Ministers of Belarus № 582 dd. 08.2019);
• The basic value comprises 27 BYN (Regulation of Council of Ministers of Belarus № 861 dd. 12.2019).

Significant changes in labour regulations

As from January, 28th, 2020:

• The Law № 219-Z dd. July 18, 2019 introduced amendments to the Belarus Labour Code in regulation of following spheres:
  • Employment,
  • Dismissal,
  • Employment agreement (contract),
  • Labour leave & Social leave,
  • Remote work,
  • Changes of significant working conditions,
  • By-work,
  • Temporary transfer,
  • Disciplinary liability & Material liability,
  • Business trips.
• The new template form of employment agreement (contract) has been approved (The Regulation of Council of Ministers of Belarus № 882 dd. 20.12.2019).
• The template form of employment agreement and the Model Internal Labour Regulations have been changed (The Regulation of the Ministry of Labour and Social Security of Belarus № 60 dd. 21.11.2019).
• The order of employment records maintaining has been revised (the Regulation of the Ministry of Labour and Social Security of Belarus № 1 dd. 10.01.2020).

Military registration

As from March, 1st, 2020:

• The Instruction about order of organization and maintaining of military register of military obliged persons approved by Regulation of Defense Ministry of Belarus № 21 dd. 31.05.2011 become invalid.
• New forms of receipt in acceptance form of a personal document of the military register, personal cards, information about the employment of citizens who are required to be on military registration, about their dismissal from work, about changes in military registration data are established.

Major tax changes

Main changes, provided for in the Decree of President of Belarus № 503 dd. 31.12.2019, came into force since January 1st, 2020 and are as follows:

• Limits for recognition of freight forwarding expenses for CIT purposes

Fuel costs for vehicles, vessels, machinery and equipment are included in the engineered costs within the following limits:

• • limits established by the Head of the Company independently, or
  • limits developed by an accredited laboratory (e.g., Research Institute “Transtehnika»).

• Personal income tax payment

Foreign companies operating in Belarus through permanent establishments (PE):

• • are obliged to transfer to the budget the amounts of calculated and withheld personal income tax no later than the 22nd day of the month following the month in which it expires:
    • 180 days (the place of provision of works/ services other than construction site);
    • exceeding 180 days (construction site)
    • or other period specified in the Double Tax Treaty;
    • for the period from the beginning of the activity via PE till the end of such activity.

• Modified order of accounting for exchange rate differences

CIT payers are now entitled to choose when to recognize exchange rate differences arising during the calendar year as non-operating income and (or) expenses for CIT purposes: to report these on quarterly basis or as a lump sum in the annual CIT return. The chosen procedure should be specified in accounting policy and cannot be changed during the year. The Decree of President of Belarus № 504 dd. 31.12.2019 applies to relations that have arisen since 01.01.2019.

Limits of consumption of fuel and energy approval has been changed

• Regulation of Council of Ministers of Belarus № 65 dd. 01.02.2020 reviewed procedure for approving the standards of energy efficiency and approval of preproject (preinvestment) documentation for the construction of thermal energy sources. The corresponding changed will come into force since 06.05.2020.