Article 437. Specifics of the application of tax deductions for a tax agent of the Tax Code of the Republic of Kazakhstan

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 1. Tax deductions for income subject to withholding tax shall be applied in accordance with the norms established by Articles 401 to 404 of this Code.

 2. The basic tax deduction and social tax deductions are applied by the tax agent at the source of payment based on:

 1) applications of an individual for the application of tax deductions;

 2) copies of supporting documents for the application of the social tax deduction.

 3. An individual has the right to apply a basic tax deduction from only one tax agent.

 If a tax agent has obligations for a calendar month to pay income to one individual in the form of employee income and income from the sale of goods, performance of work, provision of services, the basic tax deduction is applied within the amount of the basic tax deduction for the calendar month in the following sequence:

 1) to the employee's income – within the amount of such income;

 2) income from the sale of goods, performance of works, provision of services to a tax agent – in the remaining amount of the basic tax deduction.

 When a tax agent is changed during a calendar year, except in cases of reorganization, the unused amount of the basic tax deduction accumulated by the previous tax agent is not taken into account by the other tax agent.

 4. The unused amount of the social tax deduction formed by one tax agent is taken into account by another tax agent within the limits established by this Code. To do this, an individual submits a certificate of settlements with an individual issued by a tax agent(s) who has applied a social tax deduction for the period since the beginning of the calendar year in accordance with the procedure established by Article 446 of this Code.

The Code of the Republic of Kazakhstan dated July 18, 2025 No. 214-VIII SAM.

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Republic of Kazakhstan

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From January 1, 2026, to invalidate the Code of the Republic of Kazakhstan dated December 25, 2017 "On Taxes and Other Mandatory payments to the Budget" (Tax Code) in connection with the entry into force of the Tax Code dated July 18, 2025 No. 214-VIII SAM.

Article 437. General provisions of the Code on Taxes and Other Mandatory Payments to the Budget (Tax Code) of the Republic of Kazakhstan

1. The provisions of this chapter are established on the basis of international treaties concluded between the member States of the Eurasian Economic Union and regulate taxation in terms of value-added tax on the export and import of goods, performance of works, provision of services, as well as its tax administration in mutual trade of the member States of the Eurasian Economic Union.

If this chapter establishes other norms regarding the taxation of value added tax on the export and import of goods, the performance of works, the provision of services, as well as its tax administration than those contained in other chapters of this Code, the norms of this chapter shall apply.

Issues not regulated in this chapter concerning the taxation of value added tax on the export and import of goods, the performance of works, the provision of services, as well as its tax administration, are regulated by other chapters of this Code, as well as the Law of the Republic of Kazakhstan on the enactment of this Code.

The concepts used in this chapter are provided for by international treaties ratified by the Republic of Kazakhstan and concluded between the member States of the Eurasian Economic Union.

If international treaties ratified by the Republic of Kazakhstan and concluded between the member States of the Eurasian Economic Union do not provide for the concepts used in this chapter, the concepts provided for in the relevant articles of this Code, civil and other branches of legislation of the Republic of Kazakhstan shall apply.

The collection of value-added tax on goods imported into the territory of the Republic of Kazakhstan from the territory of another member State of the Eurasian Economic Union is carried out by the tax authorities at the rate established by paragraph 1 of Article 422 of this Code, applied to the amount of taxable imports.

Tax control over the fulfillment by a taxpayer of a value-added tax obligation when exporting and importing goods, performing works, and providing services in mutual trade of the member states of the Eurasian Economic Union is carried out by tax authorities on the basis of tax reports submitted by the taxpayer, as well as information and (or) documents on the taxpayer's activities received from government agencies and other persons.

For the purposes of this chapter, the value of goods, works, and services in foreign currency is converted into tenge at the market exchange rate determined on the last business day preceding the date of turnover for the sale of goods, works, and services subject to import.

2. For the purposes of this chapter, leasing is the transfer of property (leased object) under a lease agreement for a period of more than three years if it meets one of the following conditions:

1) the transfer of property (the leased object) to the ownership of the lessee at a fixed price is determined by the lease agreement;

2) the lease term exceeds 75 percent of the useful life of the leased property (leased object);

3) the current (discounted) value of lease payments for the entire lease term exceeds 90 percent of the value of the leased property (leased item).

For the purposes of this chapter, such a transfer is considered as the sale of property (leased item) by the lessor and the purchase of this property (leased item) by the lessee. In this case, the lessee is considered as the owner of the leased item, and lease payments are considered as payments on a loan provided to the lessee in the amount of a part of the cost of the goods.

For the purposes of this chapter, a lease payment is understood to be a part of the value of the goods (leased item), taking into account the remuneration provided for in the lease agreement (contract).

For the purposes of this chapter, leasing transactions are not recognized as leasing in the event of non-compliance with the above conditions or termination of the lease agreement (termination of obligations under the lease agreement) before the expiration of three years from the date of conclusion of such agreements.

For the purposes of this chapter, remuneration under a leasing agreement means all payments related to the transfer of property (leased item) to leasing, with the exception of the value at which such property (leased item) was received (transferred), payments to a person who is not a lessor for the lessee, an interconnected party.

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