Running a restaurant (fast food, buffet, café, bar, pub) business in Armenia
What is legally required for running a restaurant business in Armenia?
In order to run a restaurant business, one must have:
Registered company or sole proprietorship
What form of incorporation should a restaurant have?
Restaurants can operate under any form of incorporation available in Armenia.
What permits are required for running a restaurant business?
Permission to operate a restaurant and sell food (mandatory)
Permission to sell alcoholic beverages and/or tobacco products (required only if alcoholic beverages or tobacco are to be sold)
Permission to operate after midnight (required only if the place stays open after midnight)
Who issues the permits?
All of the above-mentioned permits are issued by the head of the community (mayor or head of the village).
How much is the local duty for obtaining the above-mentioned permits?
The duties are calculated on an annual or quarterly basis. The amount varies depending on the area that the restaurant occupies and its location. The exact amount is set by the Council of Elders of each community.
The local duties for permissions are as follows:
The duty for the permission to operate a restaurant and sell food may range from AMD 1000 per quarter if the area is smaller than 26 m2 to AMD 25 000 per quarter if the area exceeds 500 m2,
The duty for the permission to sell alcoholic beverages and tobacco products may range from AMD 10 000 per quarter if the area is smaller than 26 m2 to AMD 100 000 per quarter if the area exceeds 500 m2,
The duty for the permission to stay open after midnight may range from AMD 25 000 up to AMD 100 000 per annum.
For a detailed list of fees in Yerevan click here.
What regulations does a restaurant have to comply with?
A restaurant must have:
Appropriate equipment and furniture
Tested measuring devices
A menu that is presented to customers
Employees of a restaurant must:
Have a badge signed by the employer and containing the employee’s photo, name, surname and position
Cooks and confectioners must possess qualifications.
Is it allowed to sell street food in Armenia?
Selling street food (selling food on the streets) is not allowed (although in some locations the ban is not strictly enforced). It is only permissible to sell ice-cream, water and soft drinks upon permission by the local authorities (mayor, village head).
In addition, restaurants have to comply with requirements of the RA Law "On Food Safety" (No. ՀՕ-135-Ն adopted on 21.06.2014) as well as sanitary and hygiene regulations (Decree No. N 302 of the Minister of Health of 02.05.2003).
Restaurants can opt for either one of the following tax regimes:
Income (18%) tax and VAT (20%) or
Turnover tax. The rate of turnover tax for restaurants is 6% for operating revenue and 20% for non-operating revenue. Limitations for exceeding the turnover threshold of AMD 115 million do not apply to restaurants.
If the company wants to avail itself of special taxation systems, such as turnover tax, it must submit a statement indicating its desire to become a turnover taxpayer on a special form prepared by the tax service within 20 days following the registration. Missing that deadline would mean that the company is going to operate under the VAT regime. This statement is also submitted every year before 20 February, if the taxpayer wants to continue being considered as a turnover taxpayer (Articles 59 § 1 (1,2), 254 § 1 (1,2) of the Tax Code).
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