Tax Legislation of the Republic of Kazakhstan
Structure of the tax system
The Tax Code of the Republic of Kazakhstan establishes taxes and mandatory payments, the rights and obligations of taxpayers, and the rules for tax administration. Candidates must distinguish corporate income tax (CIT), individual income tax (IIT), value added tax (VAT), social tax, and withholding tax on payments to non-residents. Know that CIT is levied on taxable income (accounting profit adjusted for tax differences), and that tax accounting differs from accounting profit - deferred tax effects arise.
VAT and registration
Understand VAT registration thresholds, the mechanism of input VAT offset against output VAT, and the requirement for a VAT invoice (electronic invoice) to claim offset. Know that VAT is generally charged on taxable turnover and that certain supplies are exempt or zero-rated.
Traps in questions
- Confusing the tax base with the accounting base - CIT starts from accounting profit but applies tax adjustments.
- Assuming all expenses deductible for accounting are deductible for tax; the Tax Code lists non-deductible items.
- Mixing up withholding tax on non-resident income with domestic IIT.
- Forgetting that penalties and fines paid are generally non-deductible.
Rule of thumb
When a question describes an expense, ask: is it (a) incurred for business purposes, (b) documented, and (c) not on the non-deductible list? All three must hold for CIT deduction. For VAT offset, the invoice must be valid and the supply must relate to taxable activity.