01 March 2021
The main tax provisions are governed by the Tax Code of the Republic of Kazakhstan, which stipulates the types of applicable taxes and fees. Each type of tax has a certain taxable amount; there are also different types of fees, such as for state registration of legal entities, license fees and fees for emissions into the environment, for outdoor advertising, and so on.
Taxation of residents and non-residents
Taxation of income of a non-resident depends on whether the non-resident has a permanent establishment in Kazakhstan. A permanent establishment of a non-resident is a permanent place of activity through which a non-resident carries out, in whole or in part, his economic activity.
Branches / representative offices of foreign companies are also classified as non-residents. A subsidiary of a non-resident legal entity is considered a permanent establishment if its activities meet the criteria.
Residents of Kazakhstan for taxation are individuals who permanently reside in Kazakhstan, or persons who do not reside permanently, but his / her business activities are located in Kazakhstan.
Corporate income tax (CIT)
CIT payers are resident legal entities and foreign companies operating in Kazakhstan through a permanent establishment or receiving income from sources of the Republic of Kazakhstan.
The general CIT rate is 20% of the amount of taxable income.
- taxable income;
- income that is taxable at the source of payment; and
- net profit of a foreign company operating in the Republic of Kazakhstan through a permanent establishment.
In addition to CIT, the net profit of a foreign company operating in Kazakhstan through a permanent establishment is taxed at a rate of 15%. Permanent establishment of a foreign company, income not related to Kazakhstani source can be taxed at a rate of 5% to 20%.
The procedure for payment and the rate of CIT that is withheld from the source of income of a non-resident, largely depends on whether there is an agreement on the avoidance of double taxation between Kazakhstan and the relevant government.
The Tax Code of the Republic of Kazakhstan provides tax incentives for categories of national legal entities.
Personal income tax (PIT)
Personal income tax payers are individuals who have objects of taxation in the form of:
- income taxable at the source of payment; or
- income not taxable at the source of payment.
Income is taxed to PIT at a rate of 10%, with the exception of dividend income, which is taxed at a rate of 5%. Withholding income tax is calculated, withheld and paid by tax agents.
Value Added Tax (VAT)
Non-resident companies that have received the appropriate registration as a VAT payer, operating in Kazakhstan through branches/representative offices, as well as legal entities supplying goods to the territory of the Republic of Kazakhstan, are VAT payers..
The objects of VAT are taxable turnover of goods (works, services) and taxable imports. If the turnover of the aforementioned persons exceeds the minimum turnover during the year, such persons must register as a VAT payer.