The main advantages of High-Tech Park in the field of taxation
The Decree of the President of the Republic of Belarus “On the Development of the Digital Economy” added a number of tax benefits for the residents of the Park of High Technologies. Thus, HTP residents are exempt from value added tax when purchasing intellectual property from foreign organizations that are not registered in Belarus.
Other tax incentives for Hi-Tech Park residents are as follows:
– no corporate income tax;
– no value added tax;
– no real estate tax;
– no land tax.
Taxes paid by employees at the HTP
Employees of the HTP, as well as employees of organizations that are not part of the HTP, pay income tax. Earlier, the rate of income tax on wages was lower than the general rate obligatory for all employees and was equal to 9%. This tax is currently calculated at 13%.
HTP employees are also obliged to pay income tax under work contracts, as well as contributions to the Social Security Fund.
The question often arises of how to calculate the payroll tax for employees if the organization entered the HTP in the middle of the month. So, if, for example, an organization became a resident of the HTP on the 5th day, then salaries from the 1st to the 5th day of the month will be taxed at the rate of 13%, and in the period from the 6th to the 30th (31st) day of the month – at the rate of 9 %.
Let’s calculate the income tax on wages for an employee of an HTP resident using the following example. For example, an employee’s wages are equal to 2,228.2 Belarusian rubles per month. From 1 to 5 November, the tax rate is 13%, i.e. the tax will be equal to 67.7 rubles (536.14 rubles – we multiply the wages received during this period by 13%). Payroll tax from 6 to 30 November is 152.28 rubles (1692.06 × 9%).
Taxes paid by employers at the HTP
The employer – a resident of the Park of High Technologies – is obliged to pay 1% of his proceeds to the budget. Tenants also pay real estate tax when renting property, and they are exempt from paying general real estate tax. It should be noted that the lease tax is calculated and paid only for the period of the actual lease of the property.
Employers also pay tax on dividend income if the source of dividends is an HTP resident, in the amount of 5%, unless a more preferential treatment is provided for by international law.
HTP residents are not exempt from paying rent for land, despite the fact that they are exempt from paying land tax.
Increase in income tax from 9 to 13%: when it happened and how much is in effect
In December last year, the Ministry of Finance of the Republic of Belarus came up with a proposal to increase the payroll tax for “IT specialists” (employees of the High Technologies Park residents). This proposal was driven by the need to minimize costs in connection with the spread of coronavirus infection.
On January 1, 2021, the updated Tax Code came into force, which established a tax of 13% paid on the salaries of employees of residents of the Park of High Technologies. This rule is valid until January 1, 2023.
Insurance for employees of an HTP resident
HTP employees, in accordance with the Presidential Decree “On the High-Tech Park”, are subject to compulsory state social insurance. At the same time, there is a special privilege for them, which the HTP resident organizations have the right to apply at their own discretion.
Thus, contributions to the social fund are not payable for incomes that exceed the average wage in the republic for the previous month.
Sick Leaves Payments for employees of HTP residents
As mentioned above, employees of HTP residents are entitled to insurance benefits. In this regard, when applying this benefit, payments for sick leave to employees of HTP residents will be made with some peculiarities.
Disability certificates are paid to employees of the Hi-Tech Park, depending on the average wage in the country. Thus, the data of the Belarusian Statistical Committee on the average wages of employees are taken as a basis. The first 12 calendar days of sick leave are paid to them in the amount of 80% of the salary in the country, and the following days – in the amount of 100% of this value.
Below is a comparative table (HTP – not HTP)
|Incometax for civil contractors
|Social Security Fund Payments
|Sick Leaves Payments
|13% from 01.01.2021 until 01.01.2023
|Yes, but if the income exceeds one average earnings in the republic for the previous month, then deductions are not made
|The average salary in the country is taken into account (the first 12 days – 80% of the salary, the next – 100% of the salary)
|The salary at work at the employer is taken into account for 1 calendar year