Under the current legal framework, all employees and self-employed individuals registered in Armenia are required to make cumulative pension payments. These contributions, which range from 5% to 10% of income depending on the amount earned, are automatically deducted from salaries or business income and directed to the pension fund. This system, while beneficial for long-term social security, can present a financial burden for foreign workers who may not plan to retire in Armenia or benefit from its pension system.
The Armenian government has proposed that, starting from July 1, 2025, foreign nationals who are employed in Armenia and hold a valid residence permit, as well as those registered as self-employed, will have the option to apply for exemption from the obligation to contribute to the accumulated pension system. This proposed change reflects Armenia's commitment to making its regulatory environment more appealing and accessible to foreigners, particularly for those who may otherwise face higher financial obligations due to mandatory pension contributions.
Harutyun Martirosyan
Attorney
