en
Tax exemption on shares and bonds
Tax exemption on shares and bonds
We inform you that according to Article 102.1.22-2 of the Tax Code, starting from February 1, 2023, for a period of 5 (five) years, dividends, discounts (the difference resulting from bonds being placed below their nominal value), and interest income paid on shares and bonds publicly offered and admitted to trading on a regulated market within the territory of the Republic of Azerbaijan, as well as outside the country by resident legal entities, are exempt from income tax.
Accordingly, dividends paid on shares publicly offered and admitted to trading on a regulated market by resident legal entities both within and outside the Republic of Azerbaijan are exempt from income tax.
Additionally, according to Article 100.1 of the Civil Code, a joint-stock company whose shares are distributed only among its founders or a predetermined group of individuals is considered a closed joint-stock company. Such a company is not allowed to conduct a public subscription for its shares or otherwise offer them to an unlimited group of individuals.
Furthermore, the issuance, state registration, public offering, post-trade and depository systems of investment securities, the circulation of securities and derivative financial instruments, the organization, management, and liquidation of licensed entities in the securities market and the central depository, the principles and procedures governing these processes, as well as the protection of investors' rights and the legal and economic framework for regulation and supervision of the securities market, are defined by the Law of the Republic of Azerbaijan "On the Securities Market" (hereinafter referred to as the Law).
According to Article 1 of the Law, a regulated market is a system organized and managed by a stock exchange that reflects the trading interests of third parties in securities and derivative financial instruments admitted to trading in accordance with the internal rules of the stock exchange.
According to Article 8 of the Law, a public offering of investment securities is the offering of such securities to an indefinite number of individuals, via mass media, or to more than 50 persons. The public offering of investment securities (excluding shares of joint-stock companies created through the privatization of state-owned enterprises) is carried out through the stock exchange.
We inform you that according to Article 102.1.22-2 of the Tax Code, starting from February 1, 2023, for a period of 5 (five) years, dividends, discounts (the difference resulting from bonds being placed below their nominal value), and interest income paid on shares and bonds publicly offered and admitted to trading on a regulated market within the territory of the Republic of Azerbaijan, as well as outside the country by resident legal entities, are exempt from income tax.
Accordingly, dividends paid on shares publicly offered and admitted to trading on a regulated market by resident legal entities both within and outside the Republic of Azerbaijan are exempt from income tax.
Additionally, according to Article 100.1 of the Civil Code, a joint-stock company whose shares are distributed only among its founders or a predetermined group of individuals is considered a closed joint-stock company. Such a company is not allowed to conduct a public subscription for its shares or otherwise offer them to an unlimited group of individuals.
Furthermore, the issuance, state registration, public offering, post-trade and depository systems of investment securities, the circulation of securities and derivative financial instruments, the organization, management, and liquidation of licensed entities in the securities market and the central depository, the principles and procedures governing these processes, as well as the protection of investors' rights and the legal and economic framework for regulation and supervision of the securities market, are defined by the Law of the Republic of Azerbaijan "On the Securities Market" (hereinafter referred to as the Law).
According to Article 1 of the Law, a regulated market is a system organized and managed by a stock exchange that reflects the trading interests of third parties in securities and derivative financial instruments admitted to trading in accordance with the internal rules of the stock exchange.
According to Article 8 of the Law, a public offering of investment securities is the offering of such securities to an indefinite number of individuals, via mass media, or to more than 50 persons. The public offering of investment securities (excluding shares of joint-stock companies created through the privatization of state-owned enterprises) is carried out through the stock exchange.