Officials from Azerbaijan and Vietnam signed an income tax treaty on 19 May 2014. The treaty is the first of its kind between the two countries.
The treaty covers Azerbaijan individual and corporate income tax, property tax, and land tax. It covers Vietnamese personal income tax, business income tax, agricultural land-use tax, and non-agricultural land-use tax.
The treaty includes provisions that a service permanent establishment will be deemed constituted if an enterprise furnishes services in a Contracting State through employees or other engaged personnel for the same or connected projects for a period or periods aggregating more than 6 months within any 12 month period.
A permanent establishment will also be deemed constituted when a person conducts activities in a Contracting State (including offshore activities) related to the exploration for and exploitation of natural resources located in that State.
Both countries apply the credit method for the elimination of double taxation.
The treaty will enter into force once the ratification instruments are exchanged, and will apply from 1 January of the year following its entry into force.
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