Dear readers,
The tax amendments adopted in March of this year reinstated the retail tax regime. The Government approved a draft list of activities for the purposes of applying the special retail tax regime.
Retail Tax Regime
Requirements
The retail tax regime may be applied by a taxpayer that meets the following conditions:
- The average number of employees does not exceed 200 people during a tax period;
- Annual income does not exceed 600 000 times the monthly index factor (2,070,000,000 tenge in 2023);
- The taxpayer is engaged in one or more activities approved by the Government as qualifying for this regime.
The draft list of activities includes 190 types of activities, including retail, transportation, hotel and tourism, catering, entertainment, etc.
Tax Rates
Income tax under the retail tax regime is calculated at the following rates:
- 4% on income from the sale of goods, works, or services to individuals.
- 8% on income from the sale of goods, works, or services to entrepreneurs who deduct the related expenses for corporate or individual income tax purposes.
Local Maslikhats may reduce the income tax rate by up to 50%. To apply the differentiated tax rates, taxpayers are required to maintain separate tax accounting.
This special procedure for calculating corporate or individual income tax does not apply to income taxes withheld at the source of payment.
Tax Period
The tax period for the retail tax regime is a calendar quarter. The retail tax regime declaration is due by the 15th of the second month following the reporting quarter. The income tax is payable by the 25th of the second month following the reporting quarter.
Documentation
A taxpayer applying the retail tax regime is obliged to issue an VAT invoice upon a customer’s request.
Business expenses related to the acquisition of goods, works, or services from taxpayers applying the special retail tax regime are deductible with one of the following supporting documents issued by the seller:
- An electronic VAT invoice;
- A receipt of a cash register with data fixation and/or transmission function;
- A receipt of the special mobile application reflecting the buyer's identification number.
Additional Benefits
In addition to the income tax benefits, taxpayers applying the retail tax regime are exempt from social tax.
When transitioning to the special tax regime for the retail tax, VAT taxpayers are required to submit an application for VAT deregistration and VAT liquidation declaration. A taxpayer operating under the retail tax regime is not subject to VAT registration for the entire period of the retail tax regime.