BAKU, Azerbaijan, January 6. Starting from this year, business entities in Azerbaijan will be able to deduct representation expenses, housing, and food expenses of employees within the limits of the norm from their income, Trend reports, referring to the State Tax Service under the Ministry of Economy of Azerbaijan.
Under the current legislation, expenses for housing, food, and other social expenses of employees, as well as hospitality expenses incurred by business entities, are not deductible from income, and these expenses, which are an integral element of modern business, are financed from the net profit of the business.
Recent amendments to the Tax Code have defined the deduction of employer's expenses for accommodation and meals for employees, as well as hospitality expenses, from income. In this regard, a draft resolution of the Cabinet of Ministers was prepared, defining "Norms and procedure for deducting representation expenses, expenses for housing and meals for employees, as well as for medical and preventive diet, milk and other equivalent products issued to employees engaged in work with harmful, difficult working conditions and underground work from income for taxation purposes".
The amendment by formalizing this type of expenses of business entities will contribute to the creation of a favorable environment as far as the turnover of catering enterprises, landlords, etc. is concerned by introducing the established business practices into the national legislation.
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