Knowledge base / LLC
Dividends: how to take profit out of an LLC in Armenia
How much tax
Dividend tax in 2026
- Individual participant, Armenian citizen or foreigner: 5%. The company withholds it as tax agent.
- Armenian company as participant: dividends from another Armenian company are exempt.
- Foreign company as participant: 5% withholding. The tax treaties with Russia and Belarus set rates of 5% or higher, so in practice the same 5% usually applies.
- Refund: the withheld tax can be refunded if the participant reinvests the dividend in the charter capital of the same company in the same year.
Dividends are paid out of after-tax profit. Under the general regime the LLC first pays 18% profit tax, then 5% is withheld from the payout. If you are a tax resident of Russia or Belarus, Armenian dividends may also be taxable there, with the Armenian tax credited under the treaty. Check this with an adviser in your country. How Armenian residency works is explained in our tax residency guide.
How to pay dividends step by step
- Check that you are allowed to distribute
The charter capital must be fully paid. The company's net assets must not be below its charter capital plus reserve fund, either before the decision or as a result of the payout. - Calculate the profit
Your accountant closes the period and shows the net profit. Profit can be distributed no more than once a quarter, if the charter allows it. - Adopt a participants' decision
Distributing profit is an exclusive power of the general meeting. A sole participant signs the decision alone. Profit is split in proportion to the shares. - Pay out and withhold 5%
The company transfers the amount net of tax. Payment must be made within one year of the decision. - Remit the tax
The withheld tax is due by the 20th of the month after the payout month and is reported in the tax agent's returns.
Dividends or salary
A director who is also a participant can be paid a salary. It carries 20% income tax and a pension contribution, but salary reduces the company's profit. Dividends are taxed at 5%, but they come out of profit after 18% profit tax. Example under the general regime: from AMD 1,000,000 of profit, 820,000 is left after profit tax, and the participant receives 779,000 after the 5%. Salary taxes are covered in our payroll taxes guide. A small official salary plus quarterly dividends is often a sensible mix.
If the LLC pays turnover tax
Turnover tax replaces profit tax and VAT, but not the tax on dividends. When the company pays profit to an individual participant, it still withholds 5%. Distributable profit is based on the accounting records, so you need proper bookkeeping on this regime too. See our turnover tax guide. If you are still choosing a business form, compare a sole proprietor and an LLC: a sole proprietor pays no dividend tax.
Common mistakes
- Withdrawing money from the LLC account "for yourself" without a dividend decision. Such payments can be reclassified as income with extra tax, and the bank may ask for explanations.
- Distributing profit while the charter capital is unpaid or net assets are negative.
- Paying dividends more often than once a quarter.
- Forgetting to withhold and remit the 5%. The company is liable as tax agent.
- Not declaring the dividends in the country where you are tax resident.
Frequently asked questions
What is the dividend tax rate for an LLC in Armenia in 2026?
Dividends paid to individuals are taxed at 5%, the same rate for Armenian residents and non-residents. The company withholds the tax when it pays out. Dividends from one Armenian company to another are exempt.
How often can an Armenian LLC pay dividends?
No more than once a quarter, if the charter allows it. The general meeting of participants decides, and the dividends must be paid within one year of the decision.
When is an Armenian LLC not allowed to distribute profit?
When the charter capital is not fully paid, or when net assets are below the charter capital plus reserve fund or would fall below it as a result of the payout.
Is dividend tax due if the LLC pays turnover tax in Armenia?
Yes. Turnover tax replaces profit tax and VAT, but not the tax on dividends. The company withholds 5% from payouts to individual participants and remits it by the 20th of the following month.
Want to take profit out of your LLC without mistakes?
We will check net assets, prepare the participants' decision, calculate the tax and file the returns. We work in English and Russian.
Sources: PwC — dividend tax for individuals, withholding tax and treaties, dividends between Armenian companies, 18% profit tax; ARLIS — Law on LLCs, Articles 24–25; Retrieve — tax payment deadline; VitVet — taxation of participants.