Obtaining Tax Residency Certificate in Azerbaijan is provided for by the “REGULATIONS for administration of international agreements for the avoidance of double taxation between the Republic of Azerbaijan and other States”, approved by the Ministry of Taxes on 12 June 2017.
Type of Double Taxation Certificates and rules for obtaining Tax Residency Certificate in Azerbaijan are provided for by the “REGULATIONS for administration of international agreements for the avoidance of double taxation between the Republic of Azerbaijan and other States”, approved by the Ministry of Taxes on 12 June 2017.
Double taxation certificates serve different purposes in line with double taxation agreements (DTAs). Under the Azerbaijan Regulations on the administration of international agreements for the avoidance of double taxation between the Republic of Azerbaijan and other States, without such DTA forms obtained, DTA exemptions and discounts (treaty benefits) will not be granted to residents or non-residents covered by the DTAs.
The types of double taxation certificates (DTA forms) available in Azerbaijan and their purposes are listed below:
| Form | Official Name | Applicant | Purpose | Result |
|---|---|---|---|---|
| DTA-01 | Application for Certificate of Residency | Azerbaijani resident (individual or legal entity) | To obtain an Azerbaijani tax residency certificate for claiming treaty benefits abroad | Certificate of Tax Residency (Residency Certificate) |
| DTA-02 | Application for Confirmation of Tax Paid Abroad (Foreign Tax Credit) | Azerbaijani resident | To confirm foreign taxes paid so that foreign tax credit or treaty relief can be claimed in Azerbaijan | Confirmation of Foreign Taxes Paid (issued after review under the Rules) |
| DTA-03 | Application for Applying Withholding Tax Exemption or Reduced Treaty Rate | Non-resident deriving Azerbaijani-source income | To obtain treaty benefits before withholding tax is applied (relief at source) | Approval allowing application of treaty exemption or reduced withholding rate |
| DTA-04 | Application for Confirmation of Taxes Paid by a Non-Resident in Azerbaijan | Non-resident | To obtain official confirmation of Azerbaijani taxes paid for claiming exemption or foreign tax credit in the residence country | Certificate on Taxes Paid in Azerbaijan |
| DTA-05 | Application for Refund of Taxes Overpaid by a Non-Resident | Non-resident | To obtain a refund where tax was withheld in excess of the applicable treaty rate because DTA-03 was not used or treaty relief was not granted | Refund decision and repayment of excess withholding tax |
Tax residency certificates are vital for proving tax residency status in a given state and obtain benefits from the Double Tax Treaties, i.e. avoid paying double taxes. The Certificate of Residency is issued by the State Tax Service for one tax year.
A DTA Form 1 shall be approved in a soft or hard copy and submitted to State Tax Services in order to obtain tax residency certificate in Azerbaijan. In addition to the DTA-01 Form, the information on the foreign state, applicant taxpayer, as well as description of works (services) shall be attached thereto. If the certificate of residency of Azerbaijan is requested for the purpose of obtaining tax exemption or lower tax rates provided for double tax treaties with respect to any income in the other contracting state, DTA-01 Form shall contain the date and number of the agreement which constitutes the basis for the income, as well as the amount of earned income in a relevant currency (if available).
It is possible to obtain electronic or hard-copy certificate of residency in Azerbaijan, upon the choice of the applicant taxpayer.
At CLC, we can represent you and obtain relevant tax residency certificate in Azerbaijan, as well as support for obtaining tax refunds, and double taxation certificates in line with double tax treaties. Contact us via [email protected], tel: +994 50 289 89 73