en
VAT and Tax Refund Process in Export Operations
VAT and Tax Refund Process in Export Operations
We hereby inform you that according to Article 13.2.29 of the Tax Code, the export of goods refers to the removal of goods considered exportable under customs legislation from the territory of the Republic of Azerbaijan.
According to Article 165.1.3 of the Tax Code, the export of goods and the provision of services listed in Article 168.1.5 are subject to a zero (0) percent VAT rate.
Based on the above, in the case specified in the inquiry, the return of imported goods through export customs clearance in accordance with customs legislation is considered a transaction subject to VAT at a zero (0) percent rate. At the same time, if the returned goods are replaced with new ones, the import of the new goods is subject to VAT at the standard rate during customs clearance.
During such transactions, the VAT amounts paid on import are credited based on import documents issued by customs authorities confirming that VAT was paid at the time of import.
Additionally, we inform you that according to the provisions of Article 179 of the Tax Code, if at least 50 percent of a taxpayer’s taxable turnover during the reporting period is subject to VAT at a zero rate, the portion of the credited VAT that exceeds the calculated tax amount for the reporting period shall be refunded within 20 days from the date the taxpayer submits an application to the tax or customs authorities. For other taxpayers, the excess VAT amount shall be refunded no later than 4 months from the date of application to the tax or customs authorities.
We hereby inform you that according to Article 13.2.29 of the Tax Code, the export of goods refers to the removal of goods considered exportable under customs legislation from the territory of the Republic of Azerbaijan.
According to Article 165.1.3 of the Tax Code, the export of goods and the provision of services listed in Article 168.1.5 are subject to a zero (0) percent VAT rate.
Based on the above, in the case specified in the inquiry, the return of imported goods through export customs clearance in accordance with customs legislation is considered a transaction subject to VAT at a zero (0) percent rate. At the same time, if the returned goods are replaced with new ones, the import of the new goods is subject to VAT at the standard rate during customs clearance.
During such transactions, the VAT amounts paid on import are credited based on import documents issued by customs authorities confirming that VAT was paid at the time of import.
Additionally, we inform you that according to the provisions of Article 179 of the Tax Code, if at least 50 percent of a taxpayer’s taxable turnover during the reporting period is subject to VAT at a zero rate, the portion of the credited VAT that exceeds the calculated tax amount for the reporting period shall be refunded within 20 days from the date the taxpayer submits an application to the tax or customs authorities. For other taxpayers, the excess VAT amount shall be refunded no later than 4 months from the date of application to the tax or customs authorities.