The 25-year-old was left out of the Ibrox side’s Europa League squad and appears to have been deemed surplus to requirements by Rangers manager Pedro Caixinha.
Halliday has three years left on his contract at Ibrox but will spend the new season in Azerbaijan.
He is likely to play in the Europa League for his new club who finished second in their league last season and enter the continental competition at the second qualifying round.
Caixinha has reshaped the Rangers squad over the summer, signing eight players, with more expected to follow.
Halliday was left out of the Europa League squad along with Rob Kiernan, Harry Forrester, Joe Dodoo, Matt Crooks and Michael O’Halloran.