On 6 October 2026, the Minister of Economy of Azerbaijan, Mikayil Jabbarov, hosted a delegation from the United Kingdom’s HM Revenue & Customs (HMRC) and the Department for Business and Trade to discuss deepening bilateral tax cooperation. The meeting reviewed the implementation of the existing Double Taxation Avoidance Agreement (DTAA) signed in 1995 and explored the negotiation of a modernized protocol incorporating OECD BEPS Minimum Standards, including the Principal Purpose Test (PPT) and Country-by-Country Reporting (CbCR) exchange. Both sides emphasized the importance of legal certainty for investors and the need to address hybrid mismatch arrangements.
Key Takeaways
- Modernized DTAA Protocol: Negotiations for an amending protocol are slated to commence in Q1 2027, aiming to incorporate Article 16 (Pension taxation), updated residence tie-breaker rules, and a mandatory binding arbitration clause.
- Automatic Exchange of Information: Azerbaijan confirmed full operationalization of the Common Reporting Standard (CRS) and CbCR exchange with the UK as of September 2026, with first data sets exchanged for fiscal year 2025.
- Joint Capacity Building: A joint training program for tax auditors on digital economy taxation, transfer pricing, and anti-avoidance rules will be launched in early 2027, funded by the UK’s Good Governance Fund.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement