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Is it necessary to obtain a Taxpayer Identification Number (TIN/VÖEN) for online sales activities, and what taxes must be paid?
Is it necessary to obtain a Taxpayer Identification Number (TIN/VÖEN) for online sales activities, and what taxes must be paid?
Please be informed that the activity mentioned in your inquiry is considered entrepreneurial activity. According to Article 33.4 of the Tax Code, an individual conducting business activities without establishing a legal entity must register with the tax authorities (obtain a TIN/VÖEN) before starting the activity and pay taxes on the income earned.
To register, the individual must submit an application for taxpayer registration to the tax authority. Registration is free of charge and can be completed through ASAN Service Centers or taxpayer service centers.
Tax obligations depend on the taxation regime selected during registration. If the simplified tax regime is chosen, a 2% simplified tax is applied to gross trading revenue without deducting expenses. If the individual operates as an income tax payer, a 20% income tax is calculated on the profit remaining after deducting business-related expenses from the earned income.
According to Article 102.1.30 of the Tax Code, individual entrepreneurs classified as micro-business entities, employing an average of at least three employees during the year and having no outstanding social insurance liabilities, are entitled to a 75% tax exemption on their entrepreneurial income.
Furthermore, from January 1, 2025, individuals engaged in activities specified in Article 102.1.30-1 of the Tax Code are entitled to a 75% income tax exemption on annual revenues up to 45,000 AZN.
From January 1, 2026, individuals earning income from non-salaried activities must pay compulsory state social insurance contributions equal to 2% of their income (without deducting expenses), within the limits established by law.
If employees are hired, additional obligations arise, including the payment of income tax, compulsory social insurance, mandatory health insurance, and unemployment insurance contributions by both the employer and the employee.
Please be informed that the activity mentioned in your inquiry is considered entrepreneurial activity. According to Article 33.4 of the Tax Code, an individual conducting business activities without establishing a legal entity must register with the tax authorities (obtain a TIN/VÖEN) before starting the activity and pay taxes on the income earned.
To register, the individual must submit an application for taxpayer registration to the tax authority. Registration is free of charge and can be completed through ASAN Service Centers or taxpayer service centers.
Tax obligations depend on the taxation regime selected during registration. If the simplified tax regime is chosen, a 2% simplified tax is applied to gross trading revenue without deducting expenses. If the individual operates as an income tax payer, a 20% income tax is calculated on the profit remaining after deducting business-related expenses from the earned income.
According to Article 102.1.30 of the Tax Code, individual entrepreneurs classified as micro-business entities, employing an average of at least three employees during the year and having no outstanding social insurance liabilities, are entitled to a 75% tax exemption on their entrepreneurial income.
Furthermore, from January 1, 2025, individuals engaged in activities specified in Article 102.1.30-1 of the Tax Code are entitled to a 75% income tax exemption on annual revenues up to 45,000 AZN.
From January 1, 2026, individuals earning income from non-salaried activities must pay compulsory state social insurance contributions equal to 2% of their income (without deducting expenses), within the limits established by law.
If employees are hired, additional obligations arise, including the payment of income tax, compulsory social insurance, mandatory health insurance, and unemployment insurance contributions by both the employer and the employee.