Belarus tax system - taxation of Belarusian companies and individuals: VAT, income tax and capital gains. Tax treaties of Belarus

According to amendments to the Tax Code, the following personal income tax rates were set in 2024:

• 13% - on income received from various sources (including bank deposit interests) not exceeding BYN 200 000 per year;
• 25% - on income exceeding BYN 200 000 per year;
• 26% - on income concealed from tax authorities;
• 26% - on income from illegal business activity;
• 6% - on dividends if during 5 straight years no profit was distributed among Belarusian recipients, and 0% if profit was not distributed during 5 years;
• 4% - on winnings.

The standard profit tax rate in 2024 is 20%.

Since 2024, for organizations where at the end of the reporting period based on the cumulative total method since the beginning of the tax period the profit tax base exceeds BYN 25 000 000, the profit tax rate is set at 25%.

The standard 20% VAT rate applies to most goods and services / work sold in Belarus.

Furthermore, there are reduced VAT rates of 10% and 0%.

Income of non-residents received from sources in Belarus is subject to withholding tax at the following rates:

• dividends – 15%;
• interests – 10%;
• royalties – 15%.

The tax is 0.1% of the cost of one square meter multiplied by the number of square meters of the flat.

In 2024, the cost of one square meter in an apartment building, for example, in Minsk grew to BYN 968.

In 2024, contributions shall be calculated based on the maximum contribution base. It amounts to BYN 2 225 000.

A 30% flat rate also applies in 2024. After exceeding the maximum base, it is 15,1%. In other words, if an employee’s income exceeds BYN 2 225 000 per year, contributions shall be calculated based on the 15,1% rate. Otherwise, they shall be calculated based on the 30% rate.

In legislation of Belarus, there are no provisions regulating the procedure of taxation of controlled foreign companies.

The stamp duty rates are set at:

• 15% - when transferring to international organizations, foreign state authorities and organizations, foreign citizens and persons without citizenship and receiving from them promissory notes and bills of exchange;
• 20% - when issuing copies of promissory notes and bills of exchange, bills of exchange;
• 25% - in respect of a promissory note or bill of exchange made (issued), endorsed or avalized in the Republic of Belarus, its copy and a bill of exchange information on which has not been provided to the Republican Unitary Enterprise "Republican Central Securities Depository".

In Belarus, transfer pricing rules apply as part of tax control over marketness of prices set by payers.

The Tax Code of the Republic of Belarus provides for adjustment of the profit tax base when transaction prices differ from market prices and in this connection the payable tax is understated. In such a case, according to the Tax Code, the transaction price is considered to be at the market level until the tax authority proves otherwise.

The Republic of Belarus has entered into 68 Double Tax Treaties (DTCs) with the following jurisdictions:

68 DTCs: Austria, Azerbaijan, Armenia, Bangladesh, Bahrain, Belgium, Bulgaria, Great Britain, Hungary, Venezuela, Vietnam, Germany, Hong Kong, Georgia, Denmark, Egypt, Israel, India, Indonesia, Iran, Ireland, Spain, Italy, Kazakhstan, Qatar, Cyprus, China, DPRK, Korea, Kuwait, Kyrgyzstan, Laos, Latvia, Lebanon, Lithuania, Macedonia, Moldova, Mongolia, the Netherlands, the UAE, Oman, Pakistan, Poland, Russia, Romania, Saudi Arabia, Serbia, Singapore, Syria, Slovakia, Slovenia, the USA, Tajikistan, Thailand, Turkmenistan, Turkey, Uzbekistan, Finland, France, Croatia, the Czech Republic, Switzerland, Sweden, Sri Lanka, Ecuador, Estonia, South Africa, Japan.

The Republic of Belarus has not yet signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI).

Currency transactions in the Republic of Belarus are made by residents and non-residents in accordance with legal requirements based on currency contracts entered into by them or on other grounds provided by legislation of the country or legislation of foreign states.