How corporate tax works in Azerbaijan
Azerbaijan resident companies generally pay 20% profit tax on worldwide income. A non-resident enterprise with an Azerbaijan permanent establishment pays tax on Azerbaijan-source income connected with that PE, while Azerbaijan-source income not connected with a PE is commonly taxed through withholding.
Eligible small enterprises and sole entrepreneurs that are not VAT payers and have cumulative gross revenue not exceeding AZN 200,000 over any consecutive 12-month period may use the simplified tax system, generally at 2% of gross revenue. Many activities are excluded, and special PSA/HGA regimes apply in oil and gas.
Tax rates at a glance
- Corporate profit tax
- 20%
- General simplified tax
- 2%
- Catering simplified tax
- 8%
- Dividend WHT
- 5%
- Interest WHT
- 10%
- Royalties WHT
- 14%
- VAT
- 18%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
Local companiesRegional operatorsEnergy businessesVAT-registered tradersTreaty users
Watch out for
- Simplified tax is not available to many categories, including VAT payers and several regulated, wholesale, production, insurance, licensing, rental and royalty activities.
- Corporate tax compliance includes annual profit tax filing by 31 March and quarterly advance payments by the 15th day of the month after each quarter.
- Non-resident digital B2C service providers should monitor mandatory VAT registration from 1 September 2026 when the USD 10,000 annual-turnover threshold is exceeded.
- From 2026, horizontal monitoring is being introduced for qualifying medium and large taxpayers that meet the conditions, including automated accounting and an internal-control system.
Frequently asked questions
What is the corporate tax rate in Azerbaijan?
The standard Azerbaijan corporate profit tax rate is 20% for resident entities and non-resident permanent establishments.
Does Azerbaijan have a simplified company tax?
Yes. Eligible smaller taxpayers not registered for VAT and below the AZN 200,000 12-month turnover threshold may qualify for simplified tax, generally at 2% of gross revenue, but many exclusions apply.
When is Azerbaijan corporate tax due?
The annual corporate profit tax return and final payment are generally due by 31 March. Advance quarterly payments are generally due by the 15th day of the month following each quarter.