Freelancing in Armenia has been on the rise, with more professionals turning to remote work and online jobs in Armenia as a flexible and independent way to earn a living. Whether in IT, design, writing, or consulting, freelance jobs in Armenia provide exciting opportunities to work with international clients while staying in the country.
However, many freelancers are unaware that working without proper registration is considered illegal entrepreneurial activity. This lack of awareness can lead to unexpected legal and financial consequences.
To operate legally and sustainably, freelancers must understand their tax obligations, including registration, income declaration, and applicable tax rates. Navigating the tax system might seem complicated, but being informed helps ensure a stable and secure freelancing career.
In this article, we’ll break down the key tax responsibilities for freelancers in Armenia, helping you stay compliant while growing your freelance business with confidence.
So what does the law say? According to Article 2 on Entrepreneurship, any activity carried out independently with the goal of making a profit—whether through providing services, selling goods, or using property—is considered a business. This means that freelancing, whether in IT, design, consulting, or teaching, falls under this category and should be registered accordingly.
Freelancing in Armenia has two options:
We advise you to register as an IE to ensure compliance with local regulations and enjoy these benefits.
Freelancers who continue working “in the black” without proper registration can face serious fines:
These penalties can quickly add up, making it costly to remain unregistered.
Freelancing offers flexibility, but it also comes with responsibilities—one of the biggest being taxes in Armenia. If you’re working as a freelancer, you need to know how freelancer taxes work and what you’re expected to pay.
Freelancers registered as IEs are taxed under the turnover tax system (VAT system can be applied too), which means you pay a percentage of your total earnings instead of calculating complex profit margins. This system does not account for expenses, making it less favorable for freelancers with significant costs and often leading to situations where the business is not actually profitable. The tax rates depend on your type of activity:
This tax system applies to almost all types of income, and freelancers can also reduce their taxable amount if they have business-related expenses.
For most freelancers, especially those in IT, design, writing, and digital services, the 1% tax rate makes Armenia one of the most tax-friendly places for independent professionals.
New freelancers: File your tax application within 20 days of registering as an Individual Entrepreneur. This includes submitting the application for the chosen tax system and any required supporting documents.
Every year: Submit your annual tax declaration (turnover tax report) by February 20 to stay compliant and ensure proper tax reporting based on your earnings from the previous year.
If your annual earnings exceed 115 million drams, you will no longer qualify for turnover tax and will have to pay:
However, if your income comes only from abroad, you can switch to a tax system where you pay 0% VAT, reducing your overall tax burden.
While most freelancers won’t hit this threshold, it’s important to keep in mind if your business grows significantly.
If you want to work legally as a freelancer, you’ll need to register as an Individual Entrepreneur (IE). Luckily, the process is quick, affordable, and straightforward. Here’s everything you need to know about freelance registration in Armenia.
Alternatively, you can also open an IE at post offices, making the process even more accessible for freelancers outside Yerevan.
After registering, you must declare your earnings and pay taxes. You can receive payments through:
As long as you declare your income and pay the necessary taxes, you will remain compliant with Armenian tax laws.
Freelancing comes with a lot of freedom, but it also comes with tax responsibilities. Many freelancers make simple mistakes that can lead to fines, lost money, or legal trouble. Here’s a look at the most common tax issues in Armenia and how to avoid them.
Once you’re registered, you need to submit your tax application within 20 days. If you miss this deadline, you could face penalties or complications when filing taxes.
How to avoid it: Set a reminder and file your tax application right after registering to avoid any delays. Also, remember to submit your tax declaration every year by February 20.
Some freelancers think that if they receive payments through PayPal, Wise, or their personal bank accounts, they don’t have to report them. This is a big mistake—all income must be declared, no matter how you receive it.
How to avoid it: Keep track of every payment you receive, even from international clients, and report it in your tax filings. Armenia’s tax system is simple, and staying compliant will help you avoid trouble down the road.
Many freelancers forget that they can deduct business expenses, which means they end up paying more taxes than necessary. If you’re spending money on software, office supplies, or internet costs for work, you can lower your taxable income by reporting these expenses.
How to avoid it: Keep detailed records of your expenses and save receipts. Deducting business expenses can significantly reduce how much tax you owe.
Handling taxes as a freelancer can feel overwhelming, especially if you’re not familiar with the system. While accounting for freelancers in Armenia is relatively straightforward, mistakes can still lead to fines, overpaying, or unnecessary stress. That’s why many freelancers choose to work with a financial consultant to make tax management easier and hassle-free.
Profin Consulting specializes in tax advisory for freelancers in Armenia, offering expert support for independent professionals. We can assist with business registration, ensuring that you become an Individual Entrepreneur (IE) without complications. We also handle tax calculations and filings, making sure everything is done correctly and on time. If your income exceeds 115 million AMD and you need to navigate VAT and profit tax compliance, Profin Consulting can guide you through the process and help you stay on top of your obligations.
Freelancing in Armenia is an exciting way to build a flexible career, but it’s important to treat it like a real business. Registering properly and staying on top of freelancer tax obligations not only keeps you out of legal trouble but also opens doors to financial stability and professional growth.
Taxes might seem like a hassle, but they’re just another part of being an independent professional. With the right knowledge, they become manageable—and with expert help, they become even easier. If you ever feel lost in the process, Profin Consulting can guide you through every step, from registration to tax filing.
By taking taxes seriously and handling them the right way, you’re not just following the rules—you’re setting yourself up for a long-term, successful freelancing career in Armenia.
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