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Can individuals engaged in freight transport be registered for VAT for a previous period?
Can individuals engaged in freight transport be registered for VAT for a previous period?
As we know, the simplified payment of tax when obtaining a “Distinctive Sign” in relation to freight transportation activities has been abolished as of 2024. The company I work for is currently engaged in this activity and is a payer of the 2% simplified tax. However, the company’s director has instructed that an application be submitted to the tax authority for voluntary VAT registration with retroactive effect for 3 years, starting from 2022, in order to benefit from VAT refund opportunities. I would like to know whether, as a company engaged in freight transportation, we can take advantage of this opportunity.
As is known, according to the relevant amendments to the Tax Code that came into force on January 1, 2024, the payment of tax, mandatory state social insurance, and mandatory medical insurance is no longer required from taxpayers engaged in freight transportation for obtaining a “Distinctive Sign.” These obligations are fulfilled by such persons in the general manner prescribed by law.
At the same time, according to the amendment made to Article 157.3.3 of the Tax Code, which will come into force on January 1, 2025, except for the persons indicated in Article 218.4.1 of the Tax Code, as well as those who carried out freight transportation in the territory of the Republic of Azerbaijan for the period prior to January 1, 2024, VAT registration becomes effective from the date indicated in the taxpayer's registration application, provided that it does not exceed the 3-year period defined by Article 85.4 of this Code.
Accordingly, voluntary VAT registration for the period prior to January 1, 2024, is not envisaged for companies engaged in freight transportation.
As we know, the simplified payment of tax when obtaining a “Distinctive Sign” in relation to freight transportation activities has been abolished as of 2024. The company I work for is currently engaged in this activity and is a payer of the 2% simplified tax. However, the company’s director has instructed that an application be submitted to the tax authority for voluntary VAT registration with retroactive effect for 3 years, starting from 2022, in order to benefit from VAT refund opportunities. I would like to know whether, as a company engaged in freight transportation, we can take advantage of this opportunity.
As is known, according to the relevant amendments to the Tax Code that came into force on January 1, 2024, the payment of tax, mandatory state social insurance, and mandatory medical insurance is no longer required from taxpayers engaged in freight transportation for obtaining a “Distinctive Sign.” These obligations are fulfilled by such persons in the general manner prescribed by law.
At the same time, according to the amendment made to Article 157.3.3 of the Tax Code, which will come into force on January 1, 2025, except for the persons indicated in Article 218.4.1 of the Tax Code, as well as those who carried out freight transportation in the territory of the Republic of Azerbaijan for the period prior to January 1, 2024, VAT registration becomes effective from the date indicated in the taxpayer's registration application, provided that it does not exceed the 3-year period defined by Article 85.4 of this Code.
Accordingly, voluntary VAT registration for the period prior to January 1, 2024, is not envisaged for companies engaged in freight transportation.