Non-Resident Withholding Tax in Azerbaijan (Article 125)
Payments made by Azerbaijani entities or individuals to foreign non-residents without a permanent establishment in Azerbaijan are subject to withholding tax under Article 125 of the Tax Code:
- Dividends: 10.0% statutory withholding tax.
- Interest Payments: 10.0% statutory withholding tax.
- Royalties & IP Licenses: 10.0% statutory withholding tax.
- International Freight & Transport: 10.0% statutory withholding tax (reduced to 6% in certain cases).
- Management, Technical & Consulting Services: 14.0% statutory withholding tax on Azerbaijani-sourced services.
- Double Tax Treaties (DTT): Azerbaijan has active treaties with over 55 sovereign states that may eliminate or reduce these statutory rates upon submission of an authenticated DTT-03 tax residency certificate.
Statutory Regulatory Framework: Compliant with the Tax Code of the Republic of Azerbaijan, Labor Code of the Republic of Azerbaijan, Law on Social Insurance (SSPF / DSMF), and regulatory decrees issued by the State Tax Service, Tariff (Price) Council, and State Customs Committee.