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Can any goods be acquired from a taxpayer citizen with a purchase act?
Can any goods be acquired from a taxpayer citizen with a purchase act?
One of the controversial issues among our colleagues is related to the types of goods acquired through the "Goods Purchase Act." Some believe that only the purchase of goods listed in Article 3.5 of the Law of the Republic of Azerbaijan on "Cashless Payments" can be formalized with the "Goods Purchase Act." Others, however, argue that there are no restrictions on the purpose of the goods purchased from a citizen; it could be scrap metal or a vehicle.
On July 7, 2020, the Cabinet of Ministers approved Decision No. 243, which established the "Rules for the Implementation, Accounting, and Use of Electronic Purchase Acts." These rules define the electronic purchase act. The definition states that the electronic purchase act is an initial accounting document prepared and approved in electronic form when a taxpayer purchases goods from an individual not registered with the tax authority, in accordance with these rules. As indicated in the definition, the restriction regarding the electronic purchase act applies only to individuals registered with the tax authority. In other words, the person from whom the taxpayer is purchasing goods must be a citizen not registered with the tax authority. The differing approaches regarding the types of goods are related to tax withholding at the source, which we will elaborate on in the following pages.
It should be noted that on the new portal, new.e-taxes.gov.az, when registering an electronic purchase act, both the list of goods specified in Article 3.5 of the Law on "Cashless Payments" and a subsection for "other product receipts" are also provided.
One of the controversial issues among our colleagues is related to the types of goods acquired through the "Goods Purchase Act." Some believe that only the purchase of goods listed in Article 3.5 of the Law of the Republic of Azerbaijan on "Cashless Payments" can be formalized with the "Goods Purchase Act." Others, however, argue that there are no restrictions on the purpose of the goods purchased from a citizen; it could be scrap metal or a vehicle.
On July 7, 2020, the Cabinet of Ministers approved Decision No. 243, which established the "Rules for the Implementation, Accounting, and Use of Electronic Purchase Acts." These rules define the electronic purchase act. The definition states that the electronic purchase act is an initial accounting document prepared and approved in electronic form when a taxpayer purchases goods from an individual not registered with the tax authority, in accordance with these rules. As indicated in the definition, the restriction regarding the electronic purchase act applies only to individuals registered with the tax authority. In other words, the person from whom the taxpayer is purchasing goods must be a citizen not registered with the tax authority. The differing approaches regarding the types of goods are related to tax withholding at the source, which we will elaborate on in the following pages.
It should be noted that on the new portal, new.e-taxes.gov.az, when registering an electronic purchase act, both the list of goods specified in Article 3.5 of the Law on "Cashless Payments" and a subsection for "other product receipts" are also provided.