Double Taxation Agreement Between Azerbaijan and Switzerland

21 May 2025by info@acon.az

The double taxation agreement between Azerbaijan and Switzerland is a legal convention that ensures residents and businesses do not pay tax on the same income in both countries. Signed between the Government of Azerbaijan and the Swiss Federal Council, this agreement covers taxes on income and capital, promoting fair taxation and encouraging bilateral investment.

What Is Covered Under the Agreement?

This agreement applies to individuals and companies who are tax residents of either Azerbaijan or Switzerland. It includes various types of taxes:

  • In Azerbaijan: profit tax, income tax, property tax, and land tax.
  • In Switzerland: federal, cantonal, and communal income and wealth taxes.
📝 Note: The agreement also applies to any future taxes that are similar in nature or introduced after the date of signing.

 

Key Benefits of the Azerbaijan-Switzerland DTA

The convention is designed to create a stable and fair tax environment for cross-border economic activity. Main benefits include:

  • Avoiding double taxation on income such as dividends, interest, and royalties.
  • Ensuring tax transparency between authorities to prevent tax evasion.
  • Allocating taxing rights based on the taxpayer’s residency and income source.
  • Encouraging business and investment between Azerbaijan and Switzerland.

Who Can Benefit?

The agreement is relevant for:

  • Swiss companies investing in Azerbaijan
  • Azerbaijani professionals earning income from Switzerland
  • Foreign-owned businesses operating in both countries

How Tax Is Applied

Taxes are generally paid in the country where the income arises, but credits or exemptions are granted in the country of residence to avoid double taxation. Specific limits are also applied:

Income Type Maximum Tax Rate Taxed In
Dividends 5% or 15% Country of source
Interest 0% or 10% Country of source
Royalties 5% or 10% Country of source

What ACON Consulting Offer?

Our legal experts at ACON Consulting guide businesses, investors, and individuals in applying DTA provisions correctly to avoid tax duplication. We help you:

  • Determine your tax residency
  • Apply for reduced withholding tax
  • Prepare necessary declarations and forms
  • Resolve disputes through competent authority procedures
Contact Us

Whether you’re planning to invest, do business, or work between Azerbaijan and Switzerland, our team ensures you benefit fully from the tax treaty. Contact ACON Consulting today for legal and tax support tailored to your needs.

Get Professional Help

📞 +994 50 990 15 99 | ✉️ info@acon.az

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FAQs

What is the double taxation agreement between Azerbaijan and Switzerland?
It is a bilateral treaty to avoid taxing the same income in both countries and to prevent tax evasion.

 

Who can benefit from this agreement?
Residents of either country who earn income across borders—businesses, investors, and individuals.
What types of income are covered?
Dividends, interest, royalties, capital gains, and business income are included.

 

Does the agreement apply to both individuals and companies?
Yes, it applies to any resident—whether an individual or a legal entity—of either Azerbaijan or Switzerland.

 

How is residency determined for tax purposes?
Residency is based on place of living, permanent home, or where the person or business is managed.

 

What is the withholding tax rate for dividends under the treaty?
The maximum rate is 5% or 15%, depending on the ownership structure of the paying company.

 

Are there any reduced tax rates on interest and royalties?
Yes. Interest is capped at 10%, and royalties are taxed at 5% or 10% depending on the type.

 

Does the agreement help with tax disputes?
Yes. It includes procedures for competent authorities of both countries to resolve tax-related disagreements.

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