At a glance
- Computer-game publishing (NACE J58.21.0) is on the qualifying high-tech activity list in Government Decision GD 142-N of 13 February 2025, which opens the door to the 1% turnover tax.
- Qualifying activity is one test. The company must also keep total annual sales within AMD 115,000,000 and file its election on time.
- The turnover-tax election is due by 20 February, or within 20 days of registration for a new company. The Court of Cassation has held that this deadline cannot be restored.
- Operators of casinos, games of chance, totalizators and lotteries are excluded from turnover-tax status at the level of the entity, so a wagering feature can cost the whole company its 1% rate.
- Developer output does not belong to the studio automatically. Employees transfer economic rights by statutory default, while a contractor needs a written assignment.
A game studio registered in Armenia can tax its publishing revenue at 1% of turnover, because computer-game publishing (NACE J58.21.0) sits on the qualifying high-tech activity list in Government Decision GD 142-N of 13 February 2025. That listing starts the analysis. The company must still qualify as a turnover-tax payer in its own right, and one wagering feature can strip that status from the entire entity.
Choosing and registering the entity
Most studios are built on a limited liability company, and the form of the vehicle matters less than what happens in the twenty days after it is registered. The turnover-tax election is filed by 20 February for a company already trading, or within 20 days of registration for a new one. A studio that misses the window spends its first year on the general regime, at 18% corporate income tax and 20% value added tax. Registration mechanics are covered in our guide to company formation in Armenia.
The Court of Cassation treats that deadline as a substantive one. In State Tax Committee v. KEMJI Consulting LLC (2022) it held that the turnover-tax declaration deadline cannot be restored even where the failure to meet it was justified, and an accountant’s illness was held insufficient. A studio incorporating in December should treat the election as part of the registration paperwork.
Staff and contractor agreements: IP assignment for developers
Copyright in Armenia arises automatically when a work is created, with no registration step, and the author is always the natural person who created it. Paying for the work, owning the repository and supplying the hardware transfer nothing by themselves.
For an employee, the economic rights in a work created in the course of employment duties belong to the employer by statutory default, unless the employment contract says otherwise. Moral rights, meaning attribution and integrity, stay with the author and cannot be assigned away. For contractors, freelancers and outsourced vendors, that default should not be assumed to apply at all. The studio needs a separate written assignment of the contractor’s transferable economic rights, effective at the moment of creation.
What the developer agreement has to carry
A workable agreement defines Work Product widely enough to catch code, art, audio, design documents and build scripts. It deals expressly with pre-existing, third-party and open-source material and the licences attached to each. It also carries confidentiality, warranty and post-termination cooperation terms, so that a departing contractor can still be required to sign what a buyer asks for. Our IP ownership audit sets out what an investor looks for in that paper trail.
The hiring decision also moves money. HO-498-N, as amended by HO-221-N in force on 30 May 2026 and applying to reporting periods from 1 January 2026, reimburses 60% of personal income tax on qualifying new high-tech hires. It requires an employment contract, and civil-law and service contractors are excluded from it. A contractor-heavy studio therefore gives up the support and carries the assignment burden described above. A studio not yet ready to employ directly can look at an employer of record arrangement, and developers relocating to Yerevan from abroad will need work permits.
The 1% turnover tax and the payroll support can run alongside each other, since the support is open to businesses on the turnover-tax system for the 2025 to 2031 period. Each regime is tested on its own conditions, and continuing the support beyond the third year requires the general tax system.
Publisher agreements and revenue classification
Appearing on the GD 142-N list does not by itself make a company a turnover-tax payer. Two further conditions apply. Total annual sales must stay within AMD 115,000,000 (about USD 317,000 at the official Central Bank of Armenia rate of 362.83 on 30 September 2026), and the company must fall outside the excluded categories.
The ceiling is measured on total sales turnover from every activity, including revenue with no connection to games. A studio that publishes its own titles, runs a work-for-hire pipeline for other publishers and licenses its engine on the side aggregates all three streams against the same AMD 115,000,000 figure. Crossing it in the middle of a year belongs in the revenue model before the publishing contracts are signed.
Publisher and platform agreements should settle classification in writing before money starts moving: what counts as a royalty, what is a service fee, what is a recoupable advance, and which party reports each item for tax. The eligibility and timing rules for the rate itself are set out in our guide to Armenia’s 1% IT turnover tax.
Where the gambling line starts
The exclusion that bites here operates at the level of the company. Operators of casinos, games of chance, totalizators including internet totalizators, and lotteries are excluded from turnover-tax-payer status altogether, and the same exclusion applies to the microbusiness regime. A studio that bolts a wagering feature onto an otherwise ordinary game loses turnover-tax status for the entire entity and moves to 18% corporate income tax and 20% value added tax across everything it earns, including the parts of the business that never touched a wager.
Structurally, any wagering or player-funds component belongs in a separate legal entity, formed before the feature ships. The cost of moving it later is a full year of the group’s Armenian revenue taxed at general-regime rates.
Gambling activity is also licensed in its own right. The Ministry of Economy currently administers gaming licensing and the State Revenue Committee supervises licensed operators. The annual state duty for organising lotteries is AMD 600,000,000 (about USD 1.65 million at the same rate), and the duty for internet games of chance is set at the same amount. Both are annual duties charged per activity and not one-time capital requirements, and casino duties are set separately and vary by location. Armenia’s business licensing framework covers the procedure in general terms.
The precise boundary between ordinary publishing royalties and licensable wagering or player-funds handling is not settled in published guidance, so no bright-line test can be given from current sources. Free-zone permitted-activity lists do not currently extend to game publishing, so free-zone treatment should not be assumed for this activity.
One further feature of Armenian law shapes the commercial risk. Disputes about the winners and the conduct of risk-based games fall outside court jurisdiction and attract no judicial protection, except where fraud, coercion, threats or bad-faith collusion is alleged. The Court of Cassation applied that rule in ArmenTel CJSC v. Khachaturyan (2008). A studio running real-money mechanics cannot rely on the courts to settle an ordinary dispute with a player.
Frequently asked questions
Does computer-game publishing qualify for the 1% turnover tax?
Does the studio need to join a high-tech register to get the 1% rate?
What happens if we add a real-money wagering feature?
Who owns the code, the studio or the developer who wrote it?
Can we use contractors and still claim the 60% payroll reimbursement?
When is the turnover-tax election due, and can the deadline be extended?
Does the AMD 115,000,000 ceiling count only game revenue?
Who licenses gambling activity in Armenia?
What changes next
The licensing procedure described above is the one in force now. A replacement regime has been adopted, and its commencement is tied to a trigger that had not elapsed as of late September 2026, with the administering body and the procedure both inside the scope of that change. A studio planning a real-money feature for 2027 should confirm which procedure applies on the date it files, because the answer may differ from the one that applies today.
Last updated: 1 October 2026
