Baku: Digital nomads will be granted tax incentives, APA reports. This is reflected in the proposed amendments to the Law on Currency Regulation and the Tax Code discussed today at a meeting of the Milli Majlis Committee on Economic Policy, Industry and Entrepreneurship.
According to Azeri-Press News Agency, a digital nomad is defined as a foreign citizen or stateless person who works remotely in the fields of digital technologies, artificial intelligence technologies, cybersecurity, and innovation through information and communication technologies, earning income from foreign sources. The proposed amendment to the Law on Currency Regulation stipulates that there will be no amount restrictions for currency regulation purposes on foreign currency funds earned by digital nomads from foreign sources. This applies when such funds are deposited into or transferred from their accounts at authorized banks in Azerbaijan, provided tax obligations are met.
The proposed amendment to the Law on Banks states that accounts for digital nomads at authorized banks will be opened solely based on an identity document and a signature specimen card. Additionally, the proposed amendments to the Tax Code clarify that activities carried out by a digital nomad in Azerbaijan under employment or civil-law contracts with a foreign non-resident enterprise will not be considered a permanent establishment of that non-resident in Azerbaijan.
Income earned by digital nomads under contracts with non-resident persons located outside Azerbaijan, as well as income not sourced from Azerbaijan, will be exempt from income tax for 20 years from the date the digital nomad status becomes effective. This exemption applies if the non-resident paying the income is not a related party to the digital nomad, residents of Azerbaijan do not predominate among the beneficial owners of the non-resident paying the income, and the payer is not registered in low-tax jurisdictions.
According to the proposed amendments to the Migration Code, applicants must submit copies of apostilled or legalized documents confirming their engagement in specified activities and demonstrate an average stable monthly income from foreign sources over the past six months amounting to at least 13 times the minimum monthly wage. The circumstances specified in the Code will serve as grounds for granting temporary or permanent residence permits in Azerbaijan for digital nomads who register with tax authorities and operate as residents of an industrial or technology park.