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Cashless Settlements and Payment Procedures for Individuals
Cashless Settlements and Payment Procedures for Individuals
We hereby inform you that, pursuant to Article 3.3 of the Law on Cashless Settlements and taking into account the provisions of Article 3.5 of the same Law, taxpayers registered for VAT purposes and those engaged in trade and/or public catering activities whose volume of taxable transactions exceeds 200,000 manats in any month(s) within a consecutive 12-month period, must make payments exclusively in a cashless manner during a calendar month if the total amount of settlements exceeds 2 percent of the turnover (including VAT) for goods, works, and services provided in the previous calendar month. For other taxpayers, payments exceeding 15,000 manats within a calendar month must also be made in a cashless manner.
In cases where the 2 percent of the turnover (including VAT) from goods, works, and services provided in the previous calendar month is less than 30,000 manats, payments exceeding 30,000 manats in a calendar month must be made in a cashless manner. If the 2 percent exceeds 50,000 manats, then only payments over 50,000 manats must be carried out in a cashless form.
Please also be informed that according to Article 3.3-1 of the Law, for individuals engaged in seasonal work based on civil law contracts related to the direct production of agricultural products, the maximum amount that may be paid in cash per day for each such individual is set at 20 manats. This amount is not included in the cash transaction limit defined in Article 3.3 of the Law.
Furthermore, in cases where individuals who are not registered with the tax authorities and do not provide a Taxpayer Identification Number (TIN) are engaged by a legal entity to perform services (excluding those under an employment contract), payments made to such individuals are subject to withholding taxes under Article 150.1.7 of the Tax Code. Accordingly, 14% shall be withheld on the monthly income up to 2,500 manats, and for income exceeding 2,500 manats, an additional amount of 350 manats shall be added. Furthermore, income tax at a rate of 25% shall be withheld on the portion exceeding 2,500 manats, along with mandatory state social insurance contributions at a rate of 25% of the total payment, and mandatory health insurance contributions at a rate of 2% on income up to 8,000 manats and 1% on the portion exceeding 8,000 manats.
We hereby inform you that, pursuant to Article 3.3 of the Law on Cashless Settlements and taking into account the provisions of Article 3.5 of the same Law, taxpayers registered for VAT purposes and those engaged in trade and/or public catering activities whose volume of taxable transactions exceeds 200,000 manats in any month(s) within a consecutive 12-month period, must make payments exclusively in a cashless manner during a calendar month if the total amount of settlements exceeds 2 percent of the turnover (including VAT) for goods, works, and services provided in the previous calendar month. For other taxpayers, payments exceeding 15,000 manats within a calendar month must also be made in a cashless manner.
In cases where the 2 percent of the turnover (including VAT) from goods, works, and services provided in the previous calendar month is less than 30,000 manats, payments exceeding 30,000 manats in a calendar month must be made in a cashless manner. If the 2 percent exceeds 50,000 manats, then only payments over 50,000 manats must be carried out in a cashless form.
Please also be informed that according to Article 3.3-1 of the Law, for individuals engaged in seasonal work based on civil law contracts related to the direct production of agricultural products, the maximum amount that may be paid in cash per day for each such individual is set at 20 manats. This amount is not included in the cash transaction limit defined in Article 3.3 of the Law.
Furthermore, in cases where individuals who are not registered with the tax authorities and do not provide a Taxpayer Identification Number (TIN) are engaged by a legal entity to perform services (excluding those under an employment contract), payments made to such individuals are subject to withholding taxes under Article 150.1.7 of the Tax Code. Accordingly, 14% shall be withheld on the monthly income up to 2,500 manats, and for income exceeding 2,500 manats, an additional amount of 350 manats shall be added. Furthermore, income tax at a rate of 25% shall be withheld on the portion exceeding 2,500 manats, along with mandatory state social insurance contributions at a rate of 25% of the total payment, and mandatory health insurance contributions at a rate of 2% on income up to 8,000 manats and 1% on the portion exceeding 8,000 manats.