Azerbaijan’s Parliament has approved a new VAT regime for non‑resident digital service providers, requiring local registration, charging, collecting and remitting VAT from 1 January 2026. The change replaces the previous withholding‑tax or optional‑registration system, introduces a USD 10 000 annual sales threshold and ends the B2B reverse charge that had been in place since 2023. The current VAT rate on digital services remains 18%.
They must register for VAT locally, charge, collect and remit VAT from 1 January 2026, with a threshold of USD 10,000 annual sales and a 30‑day remittance period.
The reverse charge was withdrawn on 1 January 2023, so non‑resident providers can no longer rely on it.
The current VAT rate is 18%.
Consulting, engineering, law, financial and accounting, live education and training classes, and ticket sales are excluded.
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VatCalc · about 1 month ago
From 23 August 2026, non‑resident providers of digital services to Azerbaijani consumers must register with the tax administration and charge 18% VAT, replacing the previous withholding‑tax regime. The VAT registration threshold is AZN 17,000 per annum, and the current VAT rate of 18% applies to all domestically supplied digital services. Implementation guidance and FAQs are expected before the August deadline.
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VatCalc · 9 days ago
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