When Can Citizens Take Advantage of Income Tax Refunds? - SCS

The State Revenue Committee informs citizens about the conditions for receiving income tax refunds on mortgage loans.

1. Under What Conditions Can Citizens Benefit from Income Tax Refunds?

Income tax refunds are applicable to individuals who have purchased (or are purchasing) a residential apartment or individual residential house with a mortgage loan in the following cases:

• If the apartment is purchased from a developer constructing residential buildings in Armenia.
• If the apartment is acquired within the framework of state or community housing programs from the state, community, immediately from an organization or individual entrepreneur acting as a developer.
• If an individual residential house is acquired or constructed within the territory of Armenia.

2. How is the Income Tax Refunded?

Income tax related to mortgage loans is refunded based on the income tax withheld from the salaries and equivalent payments of individuals who are employed. The income tax is refunded in the amount of the mortgage loan interest payments on a quarterly basis. It's important to note that individuals receiving income from civil contracts for services cannot benefit from this tax refund.

3. What Conditions are Required to Benefit from the Income Tax Refund?

• The borrower and co-borrower can benefit from a tax refund for only one mortgage loan contractafter January 1, 2018.
• The contractual value for purchasing a residential apartment or individual residential house with a mortgage should not exceed 55 million drams.
• The total amount of income tax eligible for refund for the borrower and co-borrowers should not exceed 1.5 million drams per quarter.

4. Under What Conditions is the Income Tax Not Refunded?

The income tax will not be refunded if the apartment or individual residential house is located, being constructed, or to be constructed in the following zones defined by government decisions:

• For mortgage loans obtained after July 1, 2022, within the first zone of Yerevan's administrative territories.
• For mortgage loans obtained after January 1, 2023, if the real estate is in the second zone of Yerevan.
• For mortgage loans obtained after July 1, 2023, if the real estate is in the third zone of Yerevan.
• For mortgage loans obtained after January 1, 2025, if the real estate is in areas not mentioned in the previous points.

It should be noted that zoning restrictions do not apply to apartments in multi-apartment residential buildings or individual residential houses constructed based on permits obtained before January 1, 2022.

5. How to Apply for the First Time for an Income Tax Refund?

Citizens who have acquired an apartment with a mortgage must submit applications for tax refunds exclusively in electronic form. However, first-time users must submit the necessary documents to any office of the State Revenue Committee either in person or by mail. Necessary documents include:

• A personal identification document (passport or ID card) of the borrower.
• The borrower's public services number (or a certificate of non-existence), and TIN (if available).
• An original or notarial copy of the mortgage agreement, loan repayment schedule, and document of state registration of the mortgage property.
• A certificate from the developer stating that the apartment or individual residential house was acquired from the developer.
• The purchase agreement for the apartment or residential house.

After confirmation of the application for income tax refund eligibility, borrowers must register on the “Personal Accounts Information Portal” and submit the electronic application for tax refund.

6. How to Utilize the Electronic Platform?

To submit an application online for income tax refunds, borrowers must register in the “Personal Accounts Information Portal” by:

Option 1: If the borrower has an electronic signature, they must log in to the portal, complete the registration application, download the filled application, sign it electronically, and then upload it to register in the system.

Option 2: If the borrower does not have an electronic signature and wishes to apply electronically without obtaining one, they can visit any tax service office to submit a registration request with an active email and necessary documents.

7. How to Fill Out the Electronic Income Tax Refund Application?

After registering in the “Personal Accounts Information Portal,” the borrower must log in to their profile and create a new request in the “Income Tax Refund Applications Register.” The electronic application must include the phone number, reporting period, and current bank account number, along with an agreement in the relevant section.

8. When Will the Borrower Receive the Tax Refund?

After submitting the electronic application, the borrower can expect the income tax refund within hours or a maximum of 3 working days. For this, the employer must have already submitted and paid the income tax and the bank provided the required data about the paid interest on the mortgage loan. If any of these data are not transmitted to the State Revenue Committee, the system will notify the borrower. There is no specified deadline for submitting the income tax refund application.