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Who is exempt from paying tax?
Who is exempt from paying tax?
In the legislation of Azerbaijan, tax exemptions are determined only by the Tax Code. According to the Code:
1. Exempt from income tax:
- incomes obtained directly from the production of agricultural products;
- natural persons working in the field of crafting copper, tin and pottery products, household utensils, horticultural tools, folk musical instruments, toys, souvenirs, household items made of reeds and wicker, artistic processing of ceramic products, artistic embroidery, making household tools from wooden materials income;
- the full value of prizes received in the form of items in competitions and contests. The value of prizes received in the form of money in international competitions and competitions is up to 4,000 manats, and in national, city and district competitions and competitions up to 200 manats;
- annual interest incomes paid on deposits of natural persons by a local bank and a branch of a foreign bank operating in the Republic of Azerbaijan for a period of 7 years from February 1, 2016;
- 50 percent of the income obtained by an individual entrepreneur who received an investment promotion document from the date of receiving that document - for a period of 7 years;
- 75 percent of the income from the entrepreneurial activity of individual entrepreneurs who are micro-entrepreneurs who keep records of income and expenses in the prescribed manner;
- regardless of the degree of kinship, the taxable monthly income of a husband or wife with at least three dependents, including day-time students and students under the age of 23, is reduced by 50 manats.
2. Exempt from income tax:
- gratuitous transfers, membership fees and donations received by non-profit organizations;
- the income of preschool educational institutions and orphanages from this activity for a period of 10 years from January 1, 2014;
- 50 percent of the profit obtained by the legal entity that received the investment promotion document from the date of receipt of that document - for a period of 7 years;
- the rate of profit tax of production enterprises where at least 50 percent of the total number of employees belonging to non-governmental organizations of persons with disabilities consists of persons with disabilities is reduced by 50 percent;
3. Exempt from value added tax:
- a roll or leaflet related to the import and sale of mass media products and books (except for electronic books), as well as textbook sets, and the production (publication) of those goods (products), the list of which is approved by the body (institution) determined by the relevant executive power body import and sale of paper in the form of;
- editorial, publishing and printing activities related to the production of printed mass media products and books (including electronic books), as well as textbook sets (excluding advertising services);
- funeral and cemetery ceremonial services;
- sales turnover of agricultural products produced by producers of agricultural products (including by industrial method) - for a period of 10 years from January 1, 2014;
- provision of paid educational services (except for provision of services related to other activities);
- import and sale of wheat, production and sale of wheat flour and bread - for a period of 7 years from January 1, 2017;
- import and sale of hybrid cars with a production date of more than 3 years and an engine volume of no more than 2500 cubic centimeters - for a period of 3 years from January 1, 2022;
- sale of animal and poultry meat - for a period of 4 years from January 1, 2020;
- import of compressed gas-powered buses designed to carry more than 10 people, including the driver - for a period of 5 years from January 1, 2020.
4. Exempt from excise duty:
- import of 1.5 liters of alcoholic beverages, 200 cigarettes, 20 grams of gold, jewelry and other household items made from it, processed, sorted, framed and fixed 0.5 carat diamonds for individual consumption, as well as those coming to the Republic of Azerbaijan by car the fuel in the tank provided for by the technical passport of that vehicle for persons;
- Goods transported in transit from the territory of the Republic of Azerbaijan.
5. Exempt from property tax:
- trolleybuses and trams used for passenger transportation in cities;
- without creating a legal entity in the field of coppersmithing, tinsmithing, pottery and earthenware, household appliances, horticultural tools, folk musical instruments, toys, souvenirs, household items made of cane and wicker, artistic processing of ceramic products, artistic embroidery, making household tools from wooden materials buildings of craft workshops of natural persons engaged in entrepreneurial activity or parts of buildings where these workshops are located;
- passenger cars that are not used in the entrepreneurial activity of individuals, the main assets used by educational, cultural and sports institutions only for the purposes of these fields; the cost of capital assets used for environmental, fire protection or civil defense;
- legal and natural persons engaged in the production of agricultural products (including by industrial method) for a period of 10 years from January 1, 2014 for the property used in the process of that activity;
- a legal entity and an individual entrepreneur who received an investment promotion document for a period of 7 years for their property acquired (purchased, brought, produced, built or installed) at the expense of investment funds within the framework of the relevant investment project.
6. Exempt from land tax:
- common land of settlements;
- state, forest and water fund lands not involved in production activities;
- a legal entity and an individual entrepreneur who has received an investment promotion document for a period of 7 years for the respective lands owned or used from the date of receipt of that document.
7. Exempt from simplified tax:
- the amount of production obtained by the producers of agricultural products (including by industrial method) from the sale of agricultural products produced by themselves for a period of 10 years from January 1, 2014;
- the part of residential areas in the private ownership of natural persons up to 30 square meters;
- nurseries, nursery-kindergartens, kindergartens, special kindergartens and children's homes for a period of 10 years from January 1, 2014.
In the legislation of Azerbaijan, tax exemptions are determined only by the Tax Code. According to the Code:
1. Exempt from income tax:
- incomes obtained directly from the production of agricultural products;
- natural persons working in the field of crafting copper, tin and pottery products, household utensils, horticultural tools, folk musical instruments, toys, souvenirs, household items made of reeds and wicker, artistic processing of ceramic products, artistic embroidery, making household tools from wooden materials income;
- the full value of prizes received in the form of items in competitions and contests. The value of prizes received in the form of money in international competitions and competitions is up to 4,000 manats, and in national, city and district competitions and competitions up to 200 manats;
- annual interest incomes paid on deposits of natural persons by a local bank and a branch of a foreign bank operating in the Republic of Azerbaijan for a period of 7 years from February 1, 2016;
- 50 percent of the income obtained by an individual entrepreneur who received an investment promotion document from the date of receiving that document - for a period of 7 years;
- 75 percent of the income from the entrepreneurial activity of individual entrepreneurs who are micro-entrepreneurs who keep records of income and expenses in the prescribed manner;
- regardless of the degree of kinship, the taxable monthly income of a husband or wife with at least three dependents, including day-time students and students under the age of 23, is reduced by 50 manats.
2. Exempt from income tax:
- gratuitous transfers, membership fees and donations received by non-profit organizations;
- the income of preschool educational institutions and orphanages from this activity for a period of 10 years from January 1, 2014;
- 50 percent of the profit obtained by the legal entity that received the investment promotion document from the date of receipt of that document - for a period of 7 years;
- the rate of profit tax of production enterprises where at least 50 percent of the total number of employees belonging to non-governmental organizations of persons with disabilities consists of persons with disabilities is reduced by 50 percent;
3. Exempt from value added tax:
- a roll or leaflet related to the import and sale of mass media products and books (except for electronic books), as well as textbook sets, and the production (publication) of those goods (products), the list of which is approved by the body (institution) determined by the relevant executive power body import and sale of paper in the form of;
- editorial, publishing and printing activities related to the production of printed mass media products and books (including electronic books), as well as textbook sets (excluding advertising services);
- funeral and cemetery ceremonial services;
- sales turnover of agricultural products produced by producers of agricultural products (including by industrial method) - for a period of 10 years from January 1, 2014;
- provision of paid educational services (except for provision of services related to other activities);
- import and sale of wheat, production and sale of wheat flour and bread - for a period of 7 years from January 1, 2017;
- import and sale of hybrid cars with a production date of more than 3 years and an engine volume of no more than 2500 cubic centimeters - for a period of 3 years from January 1, 2022;
- sale of animal and poultry meat - for a period of 4 years from January 1, 2020;
- import of compressed gas-powered buses designed to carry more than 10 people, including the driver - for a period of 5 years from January 1, 2020.
4. Exempt from excise duty:
- import of 1.5 liters of alcoholic beverages, 200 cigarettes, 20 grams of gold, jewelry and other household items made from it, processed, sorted, framed and fixed 0.5 carat diamonds for individual consumption, as well as those coming to the Republic of Azerbaijan by car the fuel in the tank provided for by the technical passport of that vehicle for persons;
- Goods transported in transit from the territory of the Republic of Azerbaijan.
5. Exempt from property tax:
- trolleybuses and trams used for passenger transportation in cities;
- without creating a legal entity in the field of coppersmithing, tinsmithing, pottery and earthenware, household appliances, horticultural tools, folk musical instruments, toys, souvenirs, household items made of cane and wicker, artistic processing of ceramic products, artistic embroidery, making household tools from wooden materials buildings of craft workshops of natural persons engaged in entrepreneurial activity or parts of buildings where these workshops are located;
- passenger cars that are not used in the entrepreneurial activity of individuals, the main assets used by educational, cultural and sports institutions only for the purposes of these fields; the cost of capital assets used for environmental, fire protection or civil defense;
- legal and natural persons engaged in the production of agricultural products (including by industrial method) for a period of 10 years from January 1, 2014 for the property used in the process of that activity;
- a legal entity and an individual entrepreneur who received an investment promotion document for a period of 7 years for their property acquired (purchased, brought, produced, built or installed) at the expense of investment funds within the framework of the relevant investment project.
6. Exempt from land tax:
- common land of settlements;
- state, forest and water fund lands not involved in production activities;
- a legal entity and an individual entrepreneur who has received an investment promotion document for a period of 7 years for the respective lands owned or used from the date of receipt of that document.
7. Exempt from simplified tax:
- the amount of production obtained by the producers of agricultural products (including by industrial method) from the sale of agricultural products produced by themselves for a period of 10 years from January 1, 2014;
- the part of residential areas in the private ownership of natural persons up to 30 square meters;
- nurseries, nursery-kindergartens, kindergartens, special kindergartens and children's homes for a period of 10 years from January 1, 2014.