Table of contents introduction

Source: www.taxes.gov.az

As can be seen from Table 4, other income received by individuals from non-entrepreneurial activities is taxed at 14%. However, if the annual income of an individual as a result of non-entrepreneurial activity is more than 30,000 manat, then the tax rate will be 14% of the part up to 30,000 manat (4,200 manat) and 25% of the part over 30,000 manat.

It should be noted that not all income received by individuals is taxed. There are some types of income that are tax-exempt. Examples of tax-exempt income are (www.taxes.gov.az):

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  Travel allowances issued to persons sent on a business trip abroad on a rotating basis to cover living and transportation expenses;
  
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  In case of an insured event, the amount paid by the insurer for the purpose of indemnification for damage to life, property or health of the person;
  
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  Compensation for damages;
  
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  Income of individuals operating in the field of handicrafts;
  
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  The value of prizes received in the form of items in competitions, as well as in competitions, etc.
  

There are certain categories of individuals who are entitled to tax benefits in connection with employment. Thus, the monthly taxable income of individuals in the following categories is reduced to 400 manat (Tax Code of the Republic of Azerbaijan):

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  National Heroes of the Republic of Azerbaijan;
  
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  War invalids;
  
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  Heroes of the Soviet Union and Socialist Labor;
  
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  Widows or husbands of soldiers killed or later killed in battles;
  
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  Orders or medals for selfless servie in the rear in World War II in 1941-1945;
  
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  Persons who contracted radiation sickness as a result of the Chernobyl accident or who contracted radiation sickness by participating in the liquidation of the Chernobyl accident;
  
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  Military ranks taken to fight in Afghanistan, etc.
  

According to the Constitution of the Republic of Azerbaijan, one of the main responsibilities of every citizen is to pay taxes. Thus, according to Article 73 of the Constitution of the Republic of Azerbaijan, it is the duty of every citizen to pay taxes in full and on time. However, in some cases, enterprises and organizations, as well as individuals, evade paying taxes. In such cases, fines or other financial sanctions are imposed on taxpayers. Thus, those who do not submit a certificate of no tax liability on time, as well as those who do not submit tax reports to the relevant authorities within the specified period, are obliged to pay a financial sanction in the amount of 40 manat by the decision of the relevant executive authority.

Persons who do not submit reports on financial assets on time without any valid reason are obliged to pay a financial sanction and fine in the amount of 100 manat.