background image
5.4. Tax Base for Non-Resident Entities

Non-resident entities operating in Azerbaijan through a PE are subject to tax on the gross income generated from Azerbaijan sources, less any related deductions attributable to the PE. Gross income of a non-resident enterprise generated from Azerbaijan sources and not connected with a PE will be taxed without any deductions for expenses.

Instead of ordinary corporate tax at net amounts, sub-contractors to enterprises involved in a petroleum profit sharing agreement (PSA) may pay tax at final withholding tax rates ranging from 5% to 10% on gross proceeds derived from works and services performed in Azerbaijan.