Foreign Finance and Financial Facilities Exempt from Taxation in Iran

Nourlaw.com- Tehran- 9 April 2017-  According to the Law of Permanent Rules of the Development Plans of the Country, passed by the parliament on 10/11/1395 (29 January 2017), a particular tax exemption was set for foreigners financing Iranian projects. The incentive was published in the Official Gazette today.

Article 41 of the said law stipulates: “If introduced by the Central Bank of the Islamic Republic of Iran and approved by the Minister of Economic Affairs and Finance, foreign juridical persons residing abroad and granting facilities and finance to Iran, shall be exempt from payment of the tax foreseen in Article 107 of the amendment made to the Direct Taxation Act on 31/04/1394 (22 July 2015)”.

Article 107 stipulates that, depending on the case, the foreign natural and juridical persons residing abroad shall be taxed on the basis of 10% to 40% of the total sums acquired by them within one fiscal year in Iran or from Iran with respect to designing plans for construction and installations, topographical surveying, cartography, supervision and technical calculations, training and technical assistance, transfer of technical know-how, other services and assignment of concessions and other rights as well as ceding of movie profit rights (earned as box office receipts, screening rights, or otherwise).