This article applies only to Iran.
An economic code is a 12-digit ID assigned to real and legal persons after making a case and determination of the department by the Organization of Taxation and Economic Affairs of the country.
According to the trade law, all companies are required to obtain an economic code within two months of their registration.
Cases which require an economic code are:
- Obtaining a Commerce card
- Obtaining a value added certificate
- Participating in auctions
- Issuing official receipts for trades
- Bounding official contracts with real, legal and executive parties
- Presenting yearly revenue and quarterly value added declaration
Necessary documents for obtaining economic code
- Receiving the pamphlet and completing it (office of information and services of the department of finance)
- Receiving respective forms and completing them (office of registration and identification of department of finance)
- Copy of birth certificate and national ID card of all managing board members
- 2 Copies of company establishment add and registered changes
- Copy of company Statute
- Copy of company declaration (or company letter or request in non-stock companies)
- Copy of latest official company journal and changes
- Copy of exploitation or establishment license (if available)
- Copy of proof of ownership of company’s legal location mentioned in the advertisement, or in case the place is leased, rental leas confirmed by the tax unit of the location of the estate.
- Letter of start or failure to start the activity of the company and its copy after being registered at the secretariat
- Payment of tax of stamp to the department of finance
Old and new economic code
According to the declaration of the department of tax and customs: “In order to expand electronic services and execute the general tax and customs plan, in order to encourage and develop self-declarations regarding electronic registration and obtaining economic codes in order to facilitate tax affairs and benefitting from tax facilities, general electronic registration must be done.”
Registering for receiving a new economic code is obligatory for all legal persons because this “new economic code” will replace the previous one in the country’s tax, customs, and economic systems.
This code is different from the 12-digit code which is currently issued by the department of taxes upon the making of cases and defining the areas of companies.
In order to obtain a new economic code, a case must be made at the department of finance. Then, registration must be done through the system in 3 steps and the code can be obtained.
Difference between old and new code
Both codes are 12-digit codes issued by the department of finance. In fact, with the old code, the financial case would be made and the tax region would be defined. The new economic code is designed to be more appropriate and in accordance with the general tax system, however, no codes have been issued yet. Only the registration process is done and tracking codes are being provided.
Cases which need new economic code is as follows:
- Pre-requisite for presenting tax return declaration
- Obtaining a commercial card
- Obtaining a value added certificate
Considering that taxpayers’ declarations are done solely done electronically through the website, taxpayers wishing to present their declarations must obtain a new economic code in order to do so and to access the electronic tax system. Given that they do not proceed to obtain a new economic code, their declaration data will not be accepted by the system and they will not be able to pay their taxes electronically.
According to plans and calculations, all those who have economic activities in foreign trades with Iran’s customs (product owners, customs clients, and etc.) are required to obtain the new economic code along the old one.
Steps for obtaining a new economic code
- Initial registration
- Getting a username and password
- Final registration
The process of obtaining an economic code, same as all other paperwork in Iran is a very long, tiring, and professional task. Therefore, our advice is to use the help of expert attorneys in the field. Feel free to contact us at Sarasa Law Office.