STUDENT LOAN

How to receive a refund of paid tuition fees from income tax.

This information is for advisory purposes.

Purpose

For reimbursing tuition fees of individuals who are salaried employees, solely for obtaining one specialty.

Who is it intended for

For students who are citizens of the RA and are employed as salaried workers, studying in full-time (on-campus) programs at accredited higher education institutions in the RA, in master’s, postgraduate, or residency programs, in the specialties listed below.

List of specialties.

How is the reimbursement calculated and what is the amount?

For the purpose of reimbursing tuition fees, an amount equal to the income tax calculated on the student’s salary and equivalent payments over one year is refunded, but not exceeding the amount paid for tuition.

The starting date for calculating the refundable income tax amount is 01/09/2020.

How does the student receive the reimbursement amount?

The refunded amount is transferred to the student’s bank account.

What is required to receive the reimbursement?

It is necessary to submit the following documents to the tax authority:

• application in the form prescribed by the tax authority for income tax refund*
• copy of the contract concluded with an accredited higher education institution in the RA
• student’s identity document: passport of the RA or identification card
• student’s Public Services Number or a reference confirming the absence of a Public Services Number
• reference issued by the head of the educational institution*.

Standard certificate template

_{* The specified documents must be submitted each time an application is made, while the remaining documents are required only for the first application.}

_{The documents described above must be submitted to the tax authority within 3 months after the end of the academic year.}

_{If all required examinations are passed after the end of the academic year in order to consider the academic year successfully completed, the documents must be submitted to the tax authority within 6 months after the end of the academic year.}

_NOTE

_{The application for income tax refund is rejected if:} 

The application for income tax refund is rejected if: 

• at the time of submission of the application, the tax obligations declared in the monthly (simplified) calculation of income tax and social contributions for salary and equivalent payments have not been fully fulfilled for all months of the academic year during which the student was considered a salaried employee with the given employer.
• the required documents have not been submitted.
• the student has already, in accordance with the procedure established by this decision, once exercised the right to a refund of income tax amounts for the purpose of tuition fee reimbursement for another specialty at the same level of education.
• Based on the information available to the tax authority, it is determined that during the academic year the student has in fact exercised the right to receive an income tax refund provided for under Article 160 of the Tax Code.

Required documents:

• Applicant’s identity documents
• Public Services Number or a reference confirming the absence of a Public Services Number (if required)
• Copy of the student’s identity document
• Reference from the educational institution

A decision on the loan application is made and the customer is notified within a maximum of 1 banking day after the required documents are submitted.

In case of a positive decision on loan disbursement, the loan is provided within a maximum of 1 banking day.

NO PENALTIES ARE CHARGED IN CASE OF EARLY LOAN REPAYMENT.

• Example of loan interest calculation:
• Loan amount: AMD 220,000
• Annual nominal interest rate: 18%
• Loan term: 9 months
• In this example, the monthly loan repayment amount will be AMD 26,314
• The annual effective interest rate will be 19.64%
• Daily interest amount is calculated as: Loan amount (outstanding balance) × loan interest rate ÷ 365 = (220,000 × 18% ÷ 365) = AMD 108.49

_{*the repayment amount may vary depending on the number of days in the given month}

NOTE: LOAN INTEREST IS CALCULATED BASED ON THE NOMINAL INTEREST RATE, WHILE THE ANNUAL EFFECTIVE INTEREST RATE SHOWS HOW MUCH THE LOAN WILL ACTUALLY COST YOU, PROVIDED THAT ALL INTEREST PAYMENTS AND ALL MANDATORY PAYMENTS RELATED TO LOAN DISBURSEMENT AND SERVICING ARE MADE WITHIN THE SPECIFIED TIMEFRAMES AND AMOUNTS. YOU CAN FIND THE CALCULATION OF THE EFFECTIVE INTEREST RATE HERE.

Fill out the student loan application directly on the website:
Student loan online application

Learn more:

Student loan calculator

In case the borrower fails to fulfill their obligations on time, a penalty of 0.13% is charged for each overdue day (applicable penalties)

Loan repayments are made in the following order (when settling overdue obligations):

• Penalty/fine
• Interest
• Principal amount

The borrower of a student loan may be the student of the educational institution, as well as the student’s parents, spouse, the spouse’s parents, sisters, brothers, the spouse of a sister or brother, the siblings of the student’s parents and their spouses and children, as well as the student’s grandparents.

• The loan amount is provided in non-cash form. The loan amount is transferred to the educational institution’s bank account.
• Within the framework of cooperation agreements concluded with educational institutions, other terms for granting student loans may be established.
• Factors for a positive loan approval decision include the assessment of the customer’s creditworthiness,
• Factors for loan rejection include insufficient financial indicators identified through analysis, the customer’s poor credit history, insufficient or lack of necessary security, the professional opinion of a business consultant, and the professional opinion of the credit committee.
• During the term of the agreement, statements are provided via email every thirty days, unless the customer chooses another method of communication.

During the term of the agreement, the loan account statement and other information that are subject to mandatory disclosure under the legislation of the RA are provided free of charge. Statements not subject to mandatory disclosure under the legislation of the RA, as well as duplicate statements, are provided as follows:

• For statements with a period of up to 6 months (inclusive) – free of charge
• For statements with a period of 6 to 12 months (inclusive) – AMD 2,000 (including VAT)
• For statements with a period of more than 1 year – AMD 3,000 (including VAT).

YOU HAVE THE RIGHT TO COMMUNICATE WITH THE FINANCIAL INSTITUTION IN YOUR PREFERRED WAY, EITHER BY POSTAL MAIL OR THROUGH DIGITAL CHANNELS. RECEIVING INFORMATION DIGITALLY IS THE MOST CONVENIENT OPTION. IT IS AVAILABLE 24/7, ELIMINATES THE RISK OF LOSS OF PAPER DOCUMENTS, AND ENSURES CONFIDENTIALITY.

The Bank may unilaterally change the interest rate specified in the agreement by notifying the Borrower at least 7 calendar days in advance in the event of misuse of the loan, as well as failure to fulfill the obligations set out in the loan agreement.

NOTE: WHEN APPLYING FOR A LOAN, THE LENDER WILL PROVIDE YOU AND THE GUARANTOR(S) (if any) WITH AN INDIVIDUAL INFORMATION SHEET ON THE ESSENTIAL TERMS OF THE CONSUMER LOAN.

Information provided to the Credit register:

NOTE: IN CASE OF YOUR FAILURE OR IMPROPER PERFORMANCE OF YOUR OBLIGATIONS, THE LENDER WILL, AFTER 3 BUSINESS DAYS, SUBMIT SUCH INFORMATION TO THE CREDIT BUREAU, WHERE YOUR CREDIT HISTORY IS FORMED. YOU HAVE THE RIGHT TO OBTAIN YOUR CREDIT HISTORY FROM THE CREDIT BUREAU FREE OF CHARGE ONCE A YEAR.

NOTE: A POOR CREDIT HISTORY MAY HINDER YOUR ABILITY TO OBTAIN A LOAN IN THE FUTURE.

FOR GUARANTORS:

Please, be informed:

• If the borrower fails to fulfill their obligations, you will be required to pay on their behalf, with negative impact on your credit history, and the possibility to lose your property.
• You will be provided with copies of the loan agreement, the guarantee agreement, and the repayment schedule.
• Communication will be carried out using the method chosen by you.
• You will be notified 7 days in advance of any changes to the terms of the agreement.
• A reminder will be sent 1 day in advance regarding the existing obligation.
• In case of delayed loan repayment, you will be informed no later than one day after the delay occurs.

THE GUARANTOR HAS THE RIGHT TO:

• Request information from the lender at any time regarding the outstanding loan balance.
• Recover from the borrower the amounts paid by you on the loan, as well as any other losses incurred on behalf of the borrower.

You can learn more about the importance of credit history and the use of credit scoring here.

Your financial informant

www.fininfo.am

NOTE: "YOUR FINANCIAL INFORMANT" IS AN ELECTRONIC SYSTEM THAT MAKES IT EASY TO SEARCH FOR, COMPARE, AND CHOOSE THE MOST EFFECTIVE OPTION FOR INDIVIDUALS.