A proposed amendment to Belarus’s Tax Code was released by the Ministry of Finance, providing businesses advance notice of upcoming changes. The legislation introduces several notable provisions affecting tax treatment.

Management Services Deduction Limits

The draft restricts deductibility of management expenses. Expenses for management services should not be more than eight times the average salary for the company. Amounts exceeding this threshold cannot be deducted for profit tax purposes.

Foreign Company Income Tax Changes

The amendments address challenges faced by IT companies working with foreign platforms. Rather than withholding income tax from foreign service providers’ fees, Belarusian companies may now pay the tax independently as an expense. Tax residency verification procedures will be simplified, allowing electronic certificates posted on company websites rather than requiring hard copies.

Free Economic Zone Incentives

Profits from goods and services sales by free economic zone residents gain indefinite exemption from profit tax. Additionally, land plots within these zones receive unlimited land tax exemptions, regardless of designated use, provided activities align with the zone’s preferential regime.

Reporting Requirements

Tax agents must now provide monthly income reports to authorities for individuals, moving from the previous annual reporting system applicable to foreign nationals’ income.