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The mechanism for tax registration of non-resident individuals engaged in e-commerce for VAT purposes will be improved.
“Elchi” reports that this issue is reflected in the draft law on amendments to the Tax Code, which was discussed at today’s meeting of the Milli Majlis.
According to the draft law, non-residents engaged in e-commerce through internet information resources who receive income from the provision of works and services in electronic commerce to persons not registered with tax authorities (excluding permanent establishments of a non-resident legal entity or a non-resident individual in Azerbaijan as stipulated in the Tax Code) must be registered electronically with tax authorities within 30 days after their turnover from the provision of works and services to buyers in Azerbaijan exceeds the manat equivalent of 10,000 US dollars during the calendar year. The electronic tax registration of a non-resident whose turnover is below the manat equivalent of 10,000 US dollars will be carried out voluntarily.
The provision of consulting, legal, financial, accounting, design, and engineering services via email and other interactive communication tools, educational and training services provided in real-time via the internet, as well as online ordering services for tickets for science, education, culture, sports, and entertainment events will not be considered services provided in the course of e-commerce for the purposes of this article.
The procedure for electronic tax registration, re-registration, and deregistration, registration as a VAT payer, submission of VAT returns, and payment of VAT by a non-resident (excluding permanent establishments of a non-resident legal entity or a non-resident individual in Azerbaijan as stipulated in the Tax Code) engaged in e-commerce through internet information resources who receives income from the provision of works and services in electronic commerce to persons not registered with tax authorities will be determined by the body (institution) determined by the relevant executive authority.
A taxpayer will be obliged to pay VAT to the budget no later than the last day of the month following the reporting period for each reporting period in relation to non-resident individuals registered in the manner provided for in the three paragraphs above.
According to current legislation, the procedure for electronic tax registration, re-registration, and deregistration, registration as a VAT payer, submission of VAT returns, and payment of VAT by a non-resident (excluding permanent establishments of a non-resident legal entity or a non-resident individual in Azerbaijan as stipulated in the Tax Code) engaged in e-commerce through internet information resources who receives income from the provision of works and services in electronic commerce to residents is determined by the body (institution) determined by the relevant executive authority.
After discussions, the document was put to a vote and adopted in the third reading.