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The procedure for providing information on the financial transactions of non-residents has been changed
The procedure for providing information on the financial transactions of non-residents has been changed
The Cabinet of Ministers has made amendments to the “Limits and Rules for the Provision of Information on Financial Transactions Carried Out by Non-Residents in the Territory of the Republic of Azerbaijan to the Competent Authorities of Those States.”
According to the decision, when financial institutions open accounts for individuals and legal entities or provide financial services, for the purpose of implementing international agreements to which the Republic of Azerbaijan is a party and which provide for the exchange of tax and financial information, if cases are identified where false and/or distorted information and documents are submitted to determine a person’s residency, or changes occur that lead to a change in the residency status in the submitted information and documents, and such information and documents are not submitted within the time limits established by the Tax Code, the financial institution must immediately provide written information about the person and the identified violation to the State Tax Service under the Ministry of Economy.
A person acting on behalf of a reporting financial institution established in the legal form in accordance with the legislation of a foreign country, ensuring the maintenance of its financial accounts and the fulfillment of reporting and due diligence obligations established by these Rules (in the case of a trust, the trustee), shall bear responsibility within the limits established by law for the reporting financial institution.
Depository activity refers to an activity in which a significant part consists of holding financial assets for other persons. The activity of holding financial assets for others and providing related financial services is considered a significant part of a legal entity’s activity if the profit derived from such activity during the shorter of the following periods constitutes at least 20% of its total profit:
- the three-year period ending on December 31 of the year preceding the year in which the legal entity is recognized as a depository (or the last day of a reporting period that is not a calendar year);
- the period during which the legal entity has been in operation.
The Cabinet of Ministers has made amendments to the “Limits and Rules for the Provision of Information on Financial Transactions Carried Out by Non-Residents in the Territory of the Republic of Azerbaijan to the Competent Authorities of Those States.”
According to the decision, when financial institutions open accounts for individuals and legal entities or provide financial services, for the purpose of implementing international agreements to which the Republic of Azerbaijan is a party and which provide for the exchange of tax and financial information, if cases are identified where false and/or distorted information and documents are submitted to determine a person’s residency, or changes occur that lead to a change in the residency status in the submitted information and documents, and such information and documents are not submitted within the time limits established by the Tax Code, the financial institution must immediately provide written information about the person and the identified violation to the State Tax Service under the Ministry of Economy.
A person acting on behalf of a reporting financial institution established in the legal form in accordance with the legislation of a foreign country, ensuring the maintenance of its financial accounts and the fulfillment of reporting and due diligence obligations established by these Rules (in the case of a trust, the trustee), shall bear responsibility within the limits established by law for the reporting financial institution.
Depository activity refers to an activity in which a significant part consists of holding financial assets for other persons. The activity of holding financial assets for others and providing related financial services is considered a significant part of a legal entity’s activity if the profit derived from such activity during the shorter of the following periods constitutes at least 20% of its total profit:
- the three-year period ending on December 31 of the year preceding the year in which the legal entity is recognized as a depository (or the last day of a reporting period that is not a calendar year);
- the period during which the legal entity has been in operation.