The tax rate for corporations is 20% and is assessed for a calendar year. All Kazakhstan legal entities and branches of foreign legal entities are subject to corporate income tax (CIT). Taxable income is determined as the taxpayer's aggregate annual income less allowable deductions.
Resident companies are taxable in Kazakhstan on their worldwide profits, while non-resident companies operating through a permanent establishment (PE) in Kazakhstan are subject to Kazakhstan CIT only on the profits attributable to that PE.
Non-residents without a PE in Kazakhstan that receive income from sources in Kazakhstan are generally subject to income tax withheld at source of payment on Kazakhstan-sourced income (please see the Withholding taxes section for more information).
Reduced CIT rates
A reduced CIT rate of 6% applies to the qualified agricultural income of legal entities producing agricultural products.
In addition, taxpayers operating in special economic zones (SEZs) may enjoy full exemption from CIT if certain statutory requirements established for such benefits are met (see the Tax credits and incentives section for more information).
Excess profit tax (EPT)
EPT rates are progressive and range from 10% to 60%. The tax base is comprised of the portion of net income of subsurface users exceeding 25% of deductions for EPT purposes. Subsurface users may include to immediate deductions for EPT purposes (with certain limitations) asset acquisition costs, capital costs, and costs incurred by subsurface users in earlier periods, which were not previously deducted.
Starting from 2018, EPT is abolished for subsurface users engaging in extraction of solid minerals. At that, corresponding subsurface use contracts should not envisage extraction of other groups of mineral resources.
In addition, the Tax Code introduced an alternative tax that can substitute for several types of taxes for subsurface users (see below).
The new Tax Code introduced an alternative tax that replaces EPT, mineral extraction tax (MET), and compensation of historical costs and may be applied at the discretion of a taxpayer.
The alternative tax is applicable to subsurface use contracts on production and/or combined exploration and production of oil and gas products, the place of which should be:
- fully located in the Kazakhstan sector of the Caspian Sea, or
- at deeply folded oilfields locating not higher than 4,500 metres and with lowest point of bedding at 5,000 metres or lower.
Generally, the calculation of the tax base, the tax period, and the deadlines are similar to the existing CIT framework, except for some specifics (e.g. foreign exchange impact should be disregarded, interest expenses are not allowed for deduction). The tax rate is progressive (from 0% to 30%) and depends on the world price fluctuations of crude oil.
In addition, the taxpayers applying an alternative tax can be exempt from payment of rent tax on export of crude oil.
Local income taxes
There are no regional or local income taxes in Kazakhstan.