The refund of excess Value Added Tax (VAT) is one of the measures of state support for businesses, enabling taxpayers to recover VAT amounts that have arisen as a result of carrying out certain types of business activities in a timely manner.

        In accordance with the Tax Code of the Republic of Kazakhstan, an excess VAT amount is defined as the amount by which input VAT deductible exceeds output VAT accrued, as reflected in the VAT return on a cumulative basis at the end of the reporting tax period.

Who Is Eligible for a VAT Excess Refund?

The right to claim a refund of excess VAT is granted to the following categories of taxpayers:

-taxpayers engaged in the supply of goods, performance of work, or provision of services subject to the zero-rate VAT;

-taxpayers carrying out activities under subsoil use contracts, except for contracts related to the exploration and/or extraction of commonly occurring minerals, groundwater, and therapeutic mud;

-taxpayers purchasing goods, works, and services in connection with the construction of production buildings and facilities under long-term contracts, provided that such buildings and facilities are commissioned for the first time within the territory of the Republic of Kazakhstan.

      Cases Where an Excess VAT Amount Is Not Refundable

At the same time, the tax legislation establishes cases where an excess VAT amount is not subject to refund. In particular, no refund shall be granted for VAT amounts:

-credited on the basis of invoices issued by procurement organizations operating in the agro-industrial sector;

-credited in respect of goods, works, and services related to minerals transferred in kind as fulfillment of a tax obligation;

-accumulated during tax periods in which the taxpayer claimed an additional amount of VAT as input tax.

       How to Claim a VAT Refund

       A taxpayer has the right to submit a claim for the refund of excess VAT by indicating the relevant request in the next VAT tax return. This right may be exercised within the statute of limitations established by the tax legislation of the Republic of Kazakhstan.

       Grounds for the Refund of Confirmed Excess VAT

The following documents serve as the basis for refunding the confirmed amount of excess VAT:

-a notification confirming the amount of excess VAT approved for refund under the simplified procedure;

-a tax audit report, taking into account the results of the appeal, where applicable;

-a conclusion issued based on the tax audit report.

        Once the refundable amount has been confirmed, the taxpayer shall submit a tax application to the tax authority at the place of registration. The refund procedure is then carried out on the basis of this application.

Conclusion

       The refund of excess VAT is an important mechanism for supporting businesses and ensuring the financial stability of enterprises, particularly exporters and organizations implementing investment projects. Understanding the eligibility criteria and refund procedures enables taxpayers to exercise their right to VAT recovery in a timely manner, avoid errors in preparing the required documentation, and improve overall tax compliance.

Source : https://www.gov.kz/memleket/entities/kgd-vko/press/news/details/1258668?lang=ru