Starting a business in Belarus is a significant step that requires careful preparation and a clear understanding of various nuances, especially tax obligations. The chosen tax regime not only determines the size of the tax burden but also affects accounting and reporting procedures, as well as the way a company interacts with the tax authorities.
Belarusian legislation offers several types of taxation systems for legal entities. Each of them has its own features, benefits, and limitations, which must be considered during company registration and while choosing a business model. A well-informed choice of tax regime can help optimize costs, improve business transparency, and reduce the risk of tax audits.
In this article, we will explore the primary taxation systems available for legal entities in Belarus, examine the types of businesses they are suited for, the applicable taxes and rates, and the key factors to consider when selecting the right system. This will help you navigate the Belarusian tax environment more effectively and make informed decisions for efficient business management.
General Overview of the Tax System in Belarus
The tax system of the Republic of Belarus is governed by tax laws and regulatory legal acts that define the procedures for calculating, paying, and monitoring compliance with tax obligations by legal entities. These tax regulations aim to create transparent and stable conditions for doing business while ensuring adequate budget revenues.
Key Principles of Taxation
The tax system in Belarus is based on the following core principles:
1. Legality of Taxation
Every tax and levy is established strictly through legal regulations. This means that no tax authority or other government agency may introduce new taxes or alter existing ones without first making the necessary amendments to the relevant legislation.
2. Mandatory Payment of Taxes
All legal entities are required to fulfill their tax obligations in full and on time. Tax evasion entails liability by the law.
3. Equality of Taxpayers
All legal entities operating under similar conditions are subject to the same tax obligations. This principle eliminates unjustified advantages or discrimination among companies.
4. Certainty in Taxation
Legal provisions clearly define taxes, levies, and the procedures for calculating and paying them. Taxpayers must be able to estimate their tax liabilities in advance and plan their financial operations accordingly.
5. Fairness of Taxation
The tax burden is distributed based on the economic capacity of taxpayers. This principle is implemented through differentiated tax rates, exemptions, and special provisions for specific categories of legal entities, such as small businesses or agricultural enterprises.
6. Economic Justification
Taxes should not undermine the financial stability of a legal entity or hinder its operations. Legal norms provide support measures for specific sectors of the economy and emerging types of businesses.
These principles ensure a balance between the interests of the state and the business community, creating a foundation for stable and predictable tax regulation in Belarus.
In the following sections, we will examine the tax regimes available to legal entities and their operational details.
General Taxation System (GTS)
The General Taxation System (GTS) is the default regime applied in Belarus unless a legal entity opts for a different one, such as the simplified taxation system. Under the GTS, businesses are subject to a range of taxes and levies as outlined in tax legislation.
Key Taxes under the General Taxation System (GTS):
The General Taxation System (GTS) requires the payment of several taxes at rates that vary depending on the type of company. As a general rule, companies operating under GTS pay the following main taxes:
1. Corporate Income Tax
The main tax, with a rate of 20%. The income tax rate of 25% applies to Belarusian organizations excluding their branches, to each branch of a Belarusian organization, and to each permanent establishment of a foreign organization whose cumulative taxable profit for the reporting period, starting from the beginning of the tax period, exceeds 25,000,000 Belarusian rubles. Banks and insurance organizations pay corporate income tax at the 25% rate. A tax rate of 30% is set for the profits of commercial microfinance organizations derived from microfinance activities. Scientific and technological parks, technology transfer centers, and residents of scientific and technological parks pay corporate
2. Value Added Tax (VAT)
VAT rates vary depending on the type of activity and goods and can be 20%, 10%, or 0%.
3. Property Tax
The property tax rate depends on the cadastral value of the property. In most cases, the rate is 1%, but local authorities may adjust it slightly.
4. Land Tax
This tax is paid by companies that use land plots. Land tax rates in Belarus are not uniform for all companies and depend on many factors, including the purpose of the land. For example, for land designated for business purposes in cities, the tax rate is 249.63 Belarusian rubles per hectare.
5. Environmental Tax
This tax is paid for certain types of activities, such as emissions of pollutants into the atmosphere, discharge of wastewater into the environment, burial or storage of industrial waste. Tax rates for each type vary depending on the hazard class of the substances. The lower the hazard class, the lower the tax rate. For example, the tax rate for emissions of pollutants of hazard class IV or substances without a hazard class into the atmosphere is 229.78 Belarusian rubles per ton.
6. Other Taxes and Fees
These include so-called “payroll” taxes, such as personal income tax at 13% of employees’ wages, mandatory payments to the Social Protection Fund (34%), and insurance contributions to Belgosstrakh for mandatory employee insurance (approximately 1%).
Depending on the specifics of their activities, legal entities may also pay advertising fees, excise taxes, transport taxes, and income tax for foreign organizations. Income tax at a rate of 10%.
Legal entities under GTS are required to maintain full accounting records and submit tax reports within the established deadlines.
Who is the General Taxation System (GTS) suitable for?
The GTS is applied by legal entities that exceed the revenue limits established by law for using the simplified taxation system. It is also used by those engaged in activities excluded from the simplified system (for example, production of excisable goods, banking, and insurance activities). Additionally, companies that supply goods and services requiring mandatory VAT invoicing (such as foreign economic activities or sales within the EAEU territory) apply the GTS. The GTS is also suitable for companies working with large contractors for whom VAT credit is important.
Advantages and disadvantages of the General Taxation System (GTS)
Advantages of GTS:
- Ability to reclaim VAT on input expenses and receive refunds on exports.
- No restrictions on types of activities (suitable for all legal entities).
- Opportunity to use tax benefits provided by tax laws (for example, investment deductions, VAT exemptions for certain types of activities).
- Transparency of business operations for large clients and foreign partners.
Disadvantages of GTS:
- More complex accounting and tax reporting.
- High tax burden, especially for small businesses.
- Requirement to submit extensive reports (corporate income tax declarations, VAT returns, social fund reporting).
- Additional costs for accounting support.
Thus, the General Taxation System is mainly suitable for large and medium-sized enterprises engaged in diverse activities and actively cooperating with other companies in the market, including international partners.
Simplified Taxation System (STS)
In 2025, the Simplified Taxation System (STS) in Belarus remains a popular choice for small and medium-sized businesses due to its simplicity and reduced tax burden.
Tax Rates and Reporting
Under the Simplified Taxation System (STS), a single unified tax rate is applied. The tax under STS replaces several taxes that companies pay under the General Taxation System (GTS), including corporate income tax, VAT, and others. VAT under STS is only paid upon the import of goods and in a few other cases specified by tax regulations.
Legal entities are eligible to use STS if they meet the following two criteria:
- The average number of employees over the first nine months of the previous year does not exceed 50.
- The cumulative gross revenue for these nine months does not exceed 2,625,000 Belarusian rubles.
- They are not among organizations explicitly prohibited from using STS. For example, insurance and other financial companies, as well as companies resident in the High-Tech Park, are not allowed to apply STS.
The tax rate under STS is 6% of gross revenue. This rate applies to all income received by the organization during the tax period.
Tax reporting under STS is simpler than under GTS: the tax declaration is submitted once a year. Organizations using STS are required to maintain a book of income and expenses, which helps control financial flows and correctly calculate tax liabilities.
Pros and Cons
The Simplified Taxation System (STS) has its advantages and disadvantages that should be considered to make the right choice of taxation system.
Advantages of STS:
- Simplicity of accounting: STS exempts businesses from maintaining full accounting records, reducing administrative burden.
- Reduced tax burden: A unified tax rate simplifies calculations and lowers overall tax payments.
- Simplified reporting: Minimizing the number of reporting documents makes interactions with tax authorities easier.
Disadvantages of STS:
- Revenue limits: Exceeding the established revenue threshold may result in losing the right to use STS.
- No deductions: The inability to account for expenses when calculating the tax base can be disadvantageous for businesses with high costs.
- Restrictions on types of activities: Certain types of activities are not eligible to apply STS.
Thus, in 2025, STS offers businesses the opportunity to simplify tax administration and reduce tax burden, but it requires careful compliance with established limits and application conditions.
Taxes for High-Tech Park Resident Companies
Residents of the High-Tech Park (HTP) are IT companies and enterprises operating in the high-tech sector, registered in Belarus, and have submitted their business projects for review by the HTP Supervisory Board. To gain approval, the company must justify the project’s significance and its contribution to the development of the IT sector or the advancement of new technologies.
Taxation Features for High-Tech Park (HTP) Residents
HTP residents either do not pay certain taxes or pay them at reduced rates. To benefit from the preferential tax regime, companies must comply with HTP conditions—engaging exclusively in IT and/or high-tech activities.
Corporate Income Tax
HTP residents are exempt from paying corporate income tax, except in cases where they act as tax agents and pay income to foreign companies. In some situations, they pay income tax at a reduced rate of 9%. For example, this applies to sales of shares in the authorized capital, sale of a business as a property complex, sale or redemption of securities, and interest on loans.
If a resident sells its own property more than one year after acquisition, the standard 20% corporate income tax rate applies.
Value Added Tax (VAT)
HTP residents are exempt from VAT on the sale of services, work, goods, and property rights within Belarus. This exemption also covers certain services and rights provided by foreign partners, including:
- Intellectual property rights
- Advertising, marketing, and consulting services
- Data processing and software development
- Hosting and website management services
- Database creation and access
- Searching and transferring information about potential clients
When importing equipment necessary for their activities or investment projects, HTP residents do not pay customs VAT.
However, residents must pay VAT in certain cases, such as exports, leasing real estate, sale of property more than one year after acquisition, and sale or use of equipment imported without customs VAT within the first two years of import.
Tax on Income of Foreign Companies
Foreign companies owning HTP resident companies may benefit from a preferential income tax rate of 0% or 5%.
Offshore Tax
HTP residents are exempt from offshore tax when paying for advertising, marketing, and intermediary services, as well as dividends or profit distribution to company owners. For other companies, the standard offshore tax rate is 15%.
Personal Income Tax for Founders
Individuals who are founders of HTP residents pay personal income tax at a rate of 9%. Depending on the profit distribution period, this rate can be reduced to 6% or 0%.
Tax on Income of Foreign Organizations
HTP residents can apply a zero tax rate on payments to foreign organizations in certain cases, such as the sale of shares, stocks, and stakes owned by a foreign company for at least 365 days, as well as for providing various services including data processing, advertising placement, hosting, and other IT-related activities.
Dividend Tax for Foreign Companies
The dividend tax rate for foreign companies is set at 5%, with the possibility of reduction according to international treaties.
Property Tax
Property owned by HTP residents that is not leased out is exempt from property tax.
Land Tax
HTP residents are exempt from land tax on HTP territory for up to three years if construction related to their activities is underway. This exemption does not apply if no construction is taking place.
Customs Duties
A zero customs duty rate applies to the import of equipment necessary for the activities of HTP residents.
Conclusion
Choosing the right taxation system for a legal entity is a crucial step that directly affects business efficiency in Belarus. Each taxation system has its own advantages, disadvantages, and specific application conditions that must be taken into account when planning a company’s operations.
Our experienced lawyers are ready to analyze the details of your business and select the optimal taxation system based on the specifics of your activities. We will conduct a thorough assessment and offer solutions that help you legally reduce your tax burden and increase business profitability. Contact us for a consultation — we know how to find the best solution tailored specifically for you!
