Tax Alert: November 2018

Published
December 10, 2018

SIGNUM regularly provides Legal Alerts to keep Clients informed about important changes and legislative initiatives in Kazakhstan. This Alert includes recent tax developments related to:

• Special economic zone "TURKISTAN"

• The list of goods taxed at zero-rated VAT when sold to special economic zones

• Amended rates of Customs Duties

• Rules for calculating the annual interest rates under the loan agreements

• List of large taxpayers subject to monitoring

• Risk management system

• Selection of subjects (objects) for special tax audit

• The template for standard tax audit file and guidance on drafting

• The templates on transfer pricing reporting and guidance on how to fill them in

• Convention for the avoidance of double taxation between Kazakhstan and Luxembourg

• Convention for the avoidance of double taxation between Kazakhstan and Cyprus

1. Special Economic Zone "TURKISTAN"

Government of Kazakhstan set up the Special Economic Zone "TURKISTAN" on 29 October 2018.

Please follow the link to find out more information: https://bit.ly/2SsIRi6.

2. The list of goods taxed at zero-rated VAT when sold to special economic zones (SEZ)

Draft order amending the lists of goods taxed at zero-rated VAT, provided that such goods are sold to the territory of SEZ and fully consumed while performing the activity that meets the objectives of the SEZs was published on 13 November 2018.

Ref.: Draft Order “On introducing the amendments to the order of the Minister for Investment and Development of the Republic of Kazakhstan dated February 26, 2018 No. 131 “On approval of the lists of goods taxed by zero-rated VAT if sold to the territory of a special economic zone and when fully consumed while performing the activity that meets the objectives of the special economic zones”.

Please follow the link to find out more information: https://bit.ly/2AXA0Ov.

3. Rates of Customs Duties were amended

Government of Kazakhstan have amended rates of customs duties. These amendments are made by the Resolution No. 774 dated 16 November 2018, and came into effect on 7 December 2018.

Please follow the link to find out more information: https://bit.ly/2PeZPi0.

4. Rules for calculating the annual interest rates under the loan agreements

The Resolution No. 197 dated 27 August 2018 of the Board of the National Bank of Kazakhstan “On approval of the Rules for calculating the annual effective interest rates under the loan agreements” is effective from 3 November 2018.

Please follow the link to find out more information: https://bit.ly/2QDQd5i.

5. List of large taxpayers subject to monitoring

Draft order approving the list of large taxpayers subject to monitoring from 1 January 2019 was sent for consideration to the members of the Expert Council on Entrepreneurship Matters of the Ministry of Finance of Kazakhstan.

Please follow the link to find out more information: https://bit.ly/2zFhPNI.

6. Risk management system

The Order No. 1009 dated 16 November 2018 of the Minister of Finance of Kazakhstan amended Order No. 117 dated 2 February 2018 “On Approval of the Rules for Applying the Risk Management System in order to confirm the excess VAT and risk criteria".

Please follow the link to find out more information: https://bit.ly/2zGNnT3.

7. Selection of subjects (objects) for special tax audit

The Order approving criteria for risk assessment to identify the subjects and/or objects for special tax audits will come into effect on 10 December 2018.

Please follow the link to find out more information: https://bit.ly/2U6M4FP.

8. The template for standard tax audit file and guidance on drafting

The Ministry of Finance of Kazakhstan has developed a template for standard tax audit file and guidance on how to draft it, which will be applicable from 1 January 2019.

Please follow the link to find out more information: https://bit.ly/2FVchUE.

9. The templates on transfer pricing reporting and guidance on how to fill them in

Draft order approving the transfer pricing reporting templates and guidance on how to fill them in is being considered by the members of the Expert Council on Entrepreneurship Matters of the Ministry of Finance of Kazakhstan. Set of templates include forms on local, combined and interstate reporting. These new templates are planned to be effective from 1 January 2019.

Please follow the link to find out more information: https://bit.ly/2Qah1uk.

10. Convention for the avoidance of double taxation between Kazakhstan and Luxembourg

Draft resolution on signing the Protocol on amending the Convention between Kazakhstan and Luxembourg on avoiding double taxation is being considered by the members of the Expert Council on Entrepreneurship Matters of the Ministry of Finance of Kazakhstan.

Please follow the link to find out more information: https://bit.ly/2E0xQRe.

11. Convention for the avoidance of double taxation between Kazakhstan and Cyprus

Draft resolution on signing the Convention between Kazakhstan and Cyprus on avoidance of double taxation is being considered by the members of the Expert Council on Entrepreneurship Matters of the Ministry of Finance of Kazakhstan.

Please follow the link to find out more information: https://bit.ly/2Ry5Yb4.

The external links in this Alert referred to the web-sources in Russian language. Should you have any questions or require any further information please let us know.

Information contained in this Client Update is of general nature and cannot be used as legal advice or recommendation. Please note that Kazakhstan is an emerging economy, and its legislation and legal system are in constant development. Should you have any questions or want to discuss matters addressed in this Client Update, please contact us.