Taxes - Accounting

Azerbaijan

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Tax Rates | Accounting Rules

Tax Rates

Consumption taxes

Nature of the tax: VAT (Value Added Tax).
Tax rate: 18%
Reduced tax rate: Exports as well as financial and insurance services are exempted from VAT.
Other consumption taxes: Excise duties on alcohol, tobacco products, oil products, light vehicles, leisure and sport yachts and certain floating transports.

Corporate taxes

Tax rate

Tax on profits

20%

Tax rate for foreign companies: A person is considered as a resident if he has stayed for an accumulated period of more than 182 days in a calendar year on the territory of Azerbaijan. Non-residents are taxed on their consumption in the same way as residents.
Capital gains taxation: Long-term capital gains are included in the taxable income and are consequently taxed at 22%.
Main allowable deductions and tax credit: Possible deductions for expenses connected with the obtaining of income, interests on loans, repair expenses, business trip expenses, depreciation, tax paid overseas.
Other corporate taxes: Real property tax, social security contributions, assets tax.

Individual taxes

Tax rate

From AZN 0 to 24,000	14%
More than AZN 24,000	30%

Allowable deductions and tax credit: Some expenses are not included in the taxable income, such as: the reimbursement of business expenses; dividends and interest received by physical persons and previously taxed at the source of payment in the Azerbaijan Republic; and entertainment and meals, employee’s accommodation and other expenses of social nature incurred by the employer for employee.
Special expatriate tax regime: Expatriates are taxed on their Azerbaijani income at the same rate as the nationals.

Double taxation treaties

Countries with whom a double taxation treaty have been signed: List of the fiscal conventions signed by the Republic of Azerbaijan
Withholding taxes: Dividends: 10%, Interest: 10%, Royalties: 14%
Bilateral agreement: Azerbaijan and Tunisia are bound by a double taxation treaty: no

Signed	Ratified	Enforced

Pour aller plus loin dans vos recherches nous vous proposons de connaître les taxes locales connaître les taxes locales qui s'appliquent à votre produit.

Sources of fiscal information

Tax Authorities: Ministry of Taxes of the Republic of Azerbaijan
Other domestic resources: Azerbaijan: website with information on the Republic of Azerbaijan (section on the economy and taxes)

Accounting Rules

Tax year

The financial year begins on the 1st of January and ends on 31st December of the same year.

Accounting standards

The Azerbaijani accounting norms respect the norms by the International Accounting Standards Board.
For more information, visit the website of the Ministry of Finance of the Republic of Azerbaijan (in English and Russian).
To consult the laws on the accounting norms in the Republic of Azerbaijan, click here .

Accounting regulation bodies

Ministry of Finance of the Republic of Azerbaijan

Accounting reports

Certain companies have to use the IFRS norms : financial institutions, big companies, Investment Funds and credit institutions. Other companies have the choice between IFRS and national (NAS) norms. Small companies (whose annual sales turnover is less than 2.5 billion AZM or whose assets value is less than 5 billion AZM) will have the choice between NAS and a simplified method of accounting.

The accounting structure includes the balance sheet, the profit and loss account and the notes to the accounts.

Publication requirements

With the exception of companies operating under a Production Sharing Agreement (PSA), annual accounts should be in Azeri and in the local currency (manat). The Production Sharing Agreement (PSA) exempts certain foreign companies from the form of their accounts. In practice, the majority amongst them use the IFRS norms.

Professional accountancy bodies

The Chamber of Auditors of Azerbaijan Republic
Association of Accountants of the Republic of Azerbaijan

Certification and auditing

Audit is obligatory for companies having foreign capital, for Private Limited companies and companies whose annual turnover is more than 2.5 billion AZM or whose assets value is more than 5 billion AZM.The auditor should be certified by the Chamber of Auditors of Azerbaijan.
The Auditing Services Law 1995 governs the audit rules in Azerbaijan. These are based on the international norms (ISAs).
You can contact an external auditor: Deloitte, Ernst & Young, PricewaterhouseCoopers.

Accounting news

Azerbaijan: general information website on the Republic of Azerbaijan.
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