The Department of State Revenue for the Mangystau region informs that according to the Tax Code of the Republic of Kazakhstan, income received from sources in Kazakhstan, non-resident legal entities whose activities do not lead to the formation of a permanent establishment in the Republic of Kazakhstan, is subject to withholding taxation.

What income is taxable?:

Non-resident income received from sources in the Republic of Kazakhstan is subject to corporate income tax at the source of payment. The tax is withheld without deductions, and the calculation is carried out at the rates established by Article 682 of the Tax Code.

The tax is withheld regardless of the form and place of payment, as well as regardless of whether a non-resident disposes of income independently or for the benefit of third parties, including structural units outside Kazakhstan.

If the tax agent pays the tax at his own expense (without actual withholding), the obligation to withhold and transfer the tax is considered fulfilled.

Contracts with works and services inside and outside the Republic of Kazakhstan

If the contract with a non-resident provides for the performance of works or services both in Kazakhstan and abroad, the amount of income must be reasonably distributed between these parts.

In the absence of such a distribution, or if it was carried out unreasonably and led to an underestimation of the taxable amount, the tax is charged on the entire amount of income under the contract, regardless of where the work or services were actually performed.

Who is recognized as a tax agent

The obligation to calculate, withhold and transfer corporate income tax is imposed on the following persons who pay income to a non-resident:

1. individual entrepreneurs;
2. Non-resident legal entities operating through a structural unit;
3. Non-resident legal entities operating through a permanent establishment without opening a division;
4. resident legal entities, including issuers of depositary receipts;
5. persons who pay income from the increase in the value of assets (except for transactions with securities on the stock exchange);
6. a resident legal entity that is a service company for assets, the rights of claim for which have been assigned (assigned) in accordance with the legislation on banking and microfinance activities;
7. an individual entrepreneur, a resident legal entity, with respect to assets, the rights (claims) for which have been assigned (assigned) in accordance with the legislation on banking and microfinance activities, in the absence of a trust management agreement between a non–resident and a service company, as defined in paragraph 6 above.

Procedure and terms of tax payment:

Corporate income tax is calculated and withheld by a tax agent:

on the day income is paid to a non-resident - on accrued and paid income;

at the time of filing the tax return - for accrued but unpaid income, if they are deductible.

The transfer of tax to the budget is carried out by the tax agent at the place of registration within the time limits established by Article 684 of the Tax Code.

However, despite the above calculation, withholding and transfer of corporate income tax at the source of payment to the budget from the income of a non–resident legal entity from value appreciation is carried out in accordance with the procedure established by Article 687 of the Tax Code.

Reporting

Tax agents are required to submit a corporate income tax calculation to the tax authority:

for the 1st, 2nd and 3rd quarters - before the 15th day of the second month following the quarter in which the income was paid;

for the 4th quarter - no later than March 31 of the year following the reporting tax period in which income was paid to a non-resident and (or) for which the non-resident's accrued but unpaid income was deducted.

Separately, a non-resident who operates through a structural unit but does not form a permanent establishment in the Republic of Kazakhstan submits a corporate income tax return within the time limits established by law.  

(unofficial translation)

Source : https://www.gov.kz/memleket/entities/kgd-mangistau/press/news/details/1127114?lang=kk