Employee income (irrespective of one’s residency status) subject to taxation in Kazakhstan is any kind of income received by an employee from an employer in cash or in kind (e.g. accommodation provided by an employer, benefits, compensation, personal use of company provided car, reimbursable business trip expenses in excess of statutory limits).
No taxable income is recognised at either the grant date or date of exercise for equity compensation, as the difference between the actual cost and fair market value is specifically excluded from taxation.
The taxable income of an individual entrepreneur shall be determined in a manner similar to that of corporations (see Income determination in the Corporate tax summary).
Capital gains of the resident is subject to income tax at the rate 20%. Capital gains received from a Kazakhstan source are subject to income tax at the rate of 15%.
However, capital gains associated with the disposal of the following securities may be exempt from taxation in Kazakhstan:
- Government securities.
- Agency bonds.
- Securities listed at the day of disposal on the stock exchange operating in Kazakhstan (if sold by the method of advertised bidding on such stock exchange).
- If all of the following conditions are met:
- On the date of sale, taxpayer owns shares for more than three years.
- Company whose shares are sold is not regarded as a subsurface user.
- More than 50% of company whose shares are sold is not owned by subsurface user(s).
Dividend income received from a Kazakhstan source, as well as all foreign-source dividend income, is taxable at 15%.
Dividend income received from a resident legal entity for a calendar year is exempt from 10% taxation in Kazakhstan within 30,000 times the MCI upon distribution. The amount of dividends that is more than 30,000 times the MCI paid to an individual is subject to tax at the source of payment at the 10% rate.
In accordance with the provisions of the Kazakhstan tax legislation, interest income received from foreign banks is taxable in Kazakhstan irrespective of the level of interest rate, whereas interest income from Kazakhstan banks (operating under the licence of the authorised Kazakhstan state body on regulation and supervision of financial markets and financial institutions) is exempt from taxation in Kazakhstan for residents. The tax rate for non-residents is 15%.
Interest on debt securities, government securities, and agency bonds is also exempt from taxation in Kazakhstan.
When calculating taxable income associated with renting out or leasing a property, the taxpayer can exclude maintenance and repair costs or reimbursement of such costs associated with leasing of this property.
The following types of income shall be exempted from taxation/adjusted tax basis:
- Alimony received on children and dependents.
- Interest paid to individuals on their bank deposits, debt securities, state issue securities, and agent’s bonds.
- Dividends and interest on debt securities that are listed on the date of assessment of such dividends and interest on the official list of a stock exchange functioning on the territory of the Republic of Kazakhstan with an active bidding process.
- Dividend income within 30,000 times the MCI upon distribution received from a resident legal entity for a calendar year.
- Income of military servicemen and officers of law enforcing authorities.
- Winnings in lotteries, within 50% of the minimum amount of wages.
- Payments in connection with the performance of public work and professional training and payment made at the expense of funds of grants is capped at the minimum monthly wage (approximately USD 150).
- Payments for medical services in case of provision with relevant documentation is capped at 94 times the MCI (1 MCI = KZT 3,692 from 1 January 2024).