Tax NewsFlash - January 2026

Dear Readers,

The new Tax Code has abolished scheduled tax audits. Under Article 153 of the Tax Code, the tax authorities may appoint a tax audit only in the following cases: (1) at the request of a taxpayer (tax agent); (2) where grounds exist under the Criminal Procedure Code of Kazakhstan; (3) upon expiration of a subsoil use contract; or (4) based on a decision of the tax authorities.

The fourth case – appointment of a tax audit based on a decision of the tax authorities – is governed by a separate order¹ of the Ministry of Finance approving the rules for appointing tax audits. In this NewsFlash, we review how the tax authorities decide to conduct tax audits under that regulatory framework.

The state revenue authorities adopt decisions to conduct tax audits only after they identify (establish) violations of tax or other legislation of Kazakhstan. The Rules require the tax authorities to document such decisions using an approved form.

Audits Based on Requests from Taxpayers and/or Government Authorities

When the tax authorities receive requests from third parties, they conduct a preliminary review of the taxpayer’s tax reports and analyze information obtained from government and law enforcement authorities, as well as from other sources and the audit initiator. Through this review, the tax authorities seek to confirm the existence of violations of tax legislation.

If the review does not confirm any violations, the tax authorities issue a substantiated response to the initiator and do not appoint a tax audit. If the review confirms violations, the State Revenue Committee, departments, or territorial state revenue administrations decide to conduct a tax audit within their respective competences. As a rule, they apply the hearing procedure under Article 73 of the Administrative Procedural and Process-Related Code, except where the initiator sets a deadline of less than three business days for conducting the audit.

Lists for Preliminary Assessment of Violations

The Rules also establish a mechanism under which the State Revenue Committee compiles lists of taxpayers who require an assessment of potential violations before a tax audit decision is made. These lists may include taxpayers submitted additional tax returns for previously audited periods, engaged in transactions with problematic counterparties, failed to eliminate discrepancies identified through cameral control notices, or conducted transactions with non-residents.

For taxpayers included on such lists, departments conduct the hearing procedure under Article 73 of the Administrative Procedural and Process-Related Code directly or assign it to territorial state revenue administrations. If the taxpayer fails to eliminate the identified discrepancies, the tax authorities decide to conduct a tax audit.

Audits as Part of Tax Risk Management Measures

As part of tax risk management measures, the State Revenue Committee compiles lists of taxpayers for whom it has identified indications of violations of tax legislation. For these taxpayers, the departments issue instructions to conduct tax audits without applying the hearing procedure.

The Rules define the list of information that the tax authorities use to decide whether to appoint a tax audit. The presence of at least one such indicator leads to a decision to conduct a tax audit. These indicators include:

• a zero or understated tax liabilities compared to industry averages;
• ·sharp and unjustified year-on-year fluctuations in turnover;
• settlements with counterparties whose issuance of electronic invoices is restricted or whose transactions courts have declared invalid;
• discrepancies between purchased and sold inventories;
• systematic reporting of significant losses (exceeding 40 percent of average aggregate income);
• a long-term debit VAT balance;
• absence of tax audits for CIT and/or VAT over an extended period;
• adjustments to CIT income and deductions that reduce tax liabilities;
• indications of violations in transactions with non-residents and in international settlements;
• unresolved discrepancies identified through cameral control.

Audits for Specific Categories of Violations

The State Revenue Committee decides to conduct tax audits and refers them to departments for execution when it identifies indications of violations related to:

• deviations of transaction terms from market conditions and potential application of transfer pricing;
• non-compliance with legislative requirements governing the production and circulation of certain excisable goods;
• failure to comply with justified decisions issued following monitoring of large taxpayers;
• disagreement with, or failure to comply with, justified decisions issued following horizontal monitoring of tax obligations;
• verification of the correctness of international tax treaties application.

For these audits, the tax authorities apply the hearing procedure under Article 73 of the Administrative Procedural and Process-Related Code.

Audits at the Place of Business Activity

When deciding whether to appoint a tax audit, territorial state revenue authorities primarily assess compliance with tax discipline at the local level. They consider the following factors as potential indicators of violations:

• complaints and requests, including those submitted through social networks and other digital channels;
• absence of tax registration;
• lack of licenses and permits required for business activities;
• violations of the rules governing the use of cash registers and/or three-component integrated systems;
• failure to issue fiscal receipts or violations of payment procedures using payment cards;
• absence of shipping and transport documents or inconsistencies with actual transactions;
• absence or falsification of identification means and excise control marks;
• non-compliance with the procedure for issuing electronic invoices;
• unresolved violations previously identified through tax or cameral audits.

Territorial state revenue administrations appoint a tax audit when they confirm at least one violation relating to a specific taxpayer or identify a combination of signals indicating possible violations of legislation.

Conclusion

The Rules establish a risk-oriented approach to appointing tax audits. The tax authorities treat a tax audit as a response to identified violations rather than as a routine, scheduled, or automatic measure.

The Order entered into force on 1 January 2026.