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Azerbaijan
Individual - Other taxes
Last reviewed - 21 February 2024Social security contributions
From 1 January 2019, the mandatory social security contribution rates for employment income (other than oil and gas and government sectors) are as follows for a seven-year period:
| Amount of income | Social contribution per employee | Social contribution per employer |
| Up to AZN 200 | 3% | 2% |
| Above AZN 200 | AZN 6 + 10% for the amount above AZN 200 | AZN 44 + 15% for the amount above AZN 200 |
The standard rates that are applicable to the employees of the oil and gas and government sectors, and which will be applied after the seven-year grace period, are as follows:
- Employee: 3%
- Employer: 22%
All foreign employees are subject to social security contributions at these rates, except persons with diplomatic status and expatriate employees working under PSAs.
Entrepreneurs who are physical persons are liable to social security contributions at rates that vary depending on the type of activities and region of operation of such entrepreneurs.
Unemployment insurance contributions (UIC)
Starting from 1 January 2018, the law 'On Unemployment' has been enacted as a result of which each employer and employee will bear 0.5% UIC assessed on the gross monthly salary.
The amount of unemployment insurance payments depends on the length of insurance record and the amount of past average monthly salary.
Mandatory medical insurance
According to the Law of the Republic of Azerbaijan 'on medical insurance', the introduction of mandatory medical insurance came into force from 1 January 2021.
The calculation and payment of mandatory medical insurance is determined as follows:
| Amount of income | Social contribution per employee | Social contribution per employer |
| Up to AZN 8,000 | 2% | 2% |
| Above AZN 8,000 | AZN 160 + 0.5% for the amount above AZN 8,000 | AZN 160 + 0.5% for the amount above AZN 8,000 |
Consumption taxes
Value-added tax (VAT)
The standard rate of VAT is 18%. Individuals who are end consumers are able to receive a VAT refund on their VAT payments made for the purchased goods from entities engaged in retail trade or catering services, as well as for the purchase of residential and non-residential areas. See the Other taxes section in the Corporate tax summary for more information.
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