Accounting and Tax

1. Syria levies corporate tax on all net profits derived from Syria, at progressive rates ranging from 10% to 28%. The specific rates are levied as follows i) 22% for joint stock companies, ii) 14% for joint stock companies that offer more than 50% of their shares to the public, iii) 15% for insurance companies that offer at least 51% of their shares to the public and iv) 25% for private banks and insurance companies;
2. The standard fiscal year runs January 1^st to December 31^st, with tax returns for LLCs and joint stock companies to be filed by May 31^st and all other types of companies by March 31^st. Penalties for late payment of tax are levied at the rate of 10% annually, up to 30% of the tax liability;
3. A local administration tax known as surtax is levied in Syria and ranges from 4% to 10% depending on the region. There is also a temporary reconstruction fee of 5% levied on all direct and indirect taxes in Syria with the exception of payroll tax;
4. Branches are subject to the standard corporate tax rate applicable. There is no branch remittance tax in Syria;
5. VAT is not levied in Syria. However, consumption taxes are levied on certain services and imported luxury goods at variable rates ranging from 1.5% to 40%. Businesses are required to register for consumption tax purposes and tax is withheld by the party providing the service or by Customs in the case of imported goods and paid on a monthly basis to the Ministry of Finance;
6. Capital gains tax in Syria is included in taxable income and taxed at the applicable corporate tax rate. Capital gains derived from sale of real property is subject to tax ranging from 15% to 30% of the registered value;
7. Withholding tax in Syria is levied at a rate of i) 7.5% on interest paid to a non-resident, ii) 5% income tax on royalties paid to a non-resident as well as 2% payroll tax, iii) 7.5% on dividends paid by a non-resident corporation upon distribution and iv) 7% on technical services fees. Dividends paid by a Syrian corporation from previously taxed income is exempt from tax upon distribution;
8. Losses can be carried forward for a period of five years;
9. Tax on real estate ranges from 14% to 60% depending on the type of property. Transfer tax varies according to the type of property and type of ownership transfer;
10. Stamp duty is levied on transactions like formation of corporations, execution of documents, licenses, contracts amongst others at variable rates ranging from 0.4% to 0.7%;
11. Employers must withhold tax from employees’ salaries at variable rates ranging from 5% to 22%. The employer must also make social insurance contributions of i) 14% of the payroll costs to cover old age, disability and death benefits, ii) 3% of payroll for work injury benefits scheme and iii) 0.1% paid to a lump-sum disability benefits fund;
12. Exchange-control regulations exist in Syria whereby it is not permitted to transfer foreign currency outside of Syria unless the currency was originally imported from abroad;
13. Syria has concluded double tax avoidance treaties with 32 countries including China, France, Germany, Italy, Qatar and the United Arab Emirates;
14. Healy Consultants Compliance Department will assist our Clients with i) documenting and implementing accounting procedures ii) implementing financial accounting software iii) preparation of financial accounting records and iv) preparing forecasts, budget and sensitivity analysis;
15. It is important our Clients’ are aware of their personal and corporate tax obligations in their country of residence and domicile; and they will fulfill those obligations annually. Let us know if you need Healy Consultants’ help to clarify your annual reporting obligations.