examinations, preventive vaccinations, medical supervision, treatment, isolation and hospitalization as a result of the introduction of restrictive measures and recognition of the disease as a pandemic by the decision of the Emergency Committee of the World Health Organization.
• The excess of the market value of the underlying shares covered by a stock option at the time of exercise over the exercise price of the option.
• Alimony.
• Medical expenses within established norms.
• Dividends and interest on securities received by both Kazakhstan tax residents and nonresidents if, at the time of the accrual of such dividends and interest, the securities are on the official list of a stock exchange operating in Kazakhstan (that is, the Kazakhstan Stock Exchange [KASE] and the Astana International Exchange [AIX]), provided that such securities were traded during the reporting year.
• Dividends received by a Kazakhstan tax resident from a resident legal entity for a calendar year in the amount of 30,000
Monthly Calculation Index (MCI; as of 1 January 2024, 1 MCI = KZT3,692 or approximately USD8) or KZT110,760,000 for 2024, which is approximately USD246,000, distributed from the following:
Net income or part thereof payable on shares, including shares that are basic assets depository receipts
Net income or part thereof distributed by a resident legal entity among its founders and participants
Income from the distribution of property in the event of liquidation of a resident legal entity or a decrease in the authorized capital, in the event of a part or all of a participation interest in a legal entity being redeemed from its founder or participant or in the event of an issuing legal entity redeeming shares from a shareholder
• Capital gains derived through the open-bidding method from the sale of securities or participating interests in resident legal entities or consortiums if all of the following conditions are met simultaneously:
At the date of disposal, the shares or participating interests have been held for more than three years.
The legal entity or consortium that is the issuer of the shares or participating interests sold is not a subsurface user.
At the date of disposal, no more than 50% of the value of assets of the legal entity or consortium that is the issuer of the shares or participating interests sold is attributable to the assets of a subsurface user entity (entities).
• Capital gains derived from the securities that are listed on a stock exchange operating in Kazakhstan (the KASE or the AIX) at the date of realization.
• Interest income on deposits paid to tax resident individuals by licensed organizations in Kazakhstan.
• Income from Kazakhstan state securities.
• Ninety percent of the taxable income of the employee if the income is less than 25 MCI (KZT92,300 or approximately USD205) per month.
Taxation of stock options. In general, income received in connection with employment (including stock received for free or at a
discount) is taxable. However, there is a general tax code provision stating that the positive difference between the fair market value of share and option cost at the date of stock option execution is not considered taxable income (see Exempt income). Therefore, employer stock option plans require detailed analysis.
Capital gains. According to the Kazakhstan Tax Code, a capital gain is the difference between the sale price (disposal value) and the acquisition price (base cost) supported by documents.
Income derived from the disposal of shares acquired through the exercise of a stock option equals the positive difference between the sale price and the acquisition price. The acquisition price includes the exercise price of the option and the option premium.
In the case of sales of property located in a prohibited list low-tax jurisdictions, the taxable amount is determined to be the full sale price (that is, the acquisition cost is nondeductible).
Capital gains are subject to tax at the rates set forth in Rates.
Capital transactions of individuals are not currently sufficiently addressed by Kazakhstan tax legislation. Consequently, it is not possible to deduct capital losses from capital gains for tax purposes, and capital losses may not be carried backward or forward to other tax periods. Further, no expenses are allowed for calculating taxable income even for basic financial instruments as shares or bonds. Therefore, income for tax purposes may significantly exceed income shown in financial statements prepared by a financial institution.
Controlled foreign companies. Individual tax residents who directly, indirectly or constructively control nonresident legal entities and/or other types of organizations subject to certain conditions have a 10% personal income tax obligation regarding the controlled foreign companies’ retained earnings and separate tax reporting obligations.
Tax deductions. For 2024, 14 MCI, which equals KZT51,688 (approximately USD115), per month, is deductible from a tax resident employee’s taxable income. If an employee’s taxable income for a particular month is below the minimum monthly wage, the unused part of the deduction may be carried over to later months within the year. This does not apply when an individual changes his or her workplace during a tax period; that is, the individual may not offset an excess arising at the previous workplace against income earned at the new workplace except in cases of reorganizations.
The total amount of the standard deduction of 14 MCI for a calendar year may not exceed 168 MCI (KZT620,256 or approximately USD1,378).
Other tax deductions include, but are not limited to, the following:
• Obligatory pension fund contributions
• Obligatory employee social medical insurance contributions
• Voluntary pension fund contributions made by the individual for his or her own benefit or by a tax agent under the Kazakhstan legislation on pension coverage
receiving income under civil contracts at the rate of 2% of the employee’s income.
These employee contributions are deductible for personal income tax and social tax purposes.
For 2024, income subject to employer and employee contributions to the Fund of Social Medical Insurance is capped at 10 MMS (KZT850,000 or approximately USD1,888) per month.
“Independent payers,” including Kazakhstan citizens who left Kazakhstan, are also liable to pay contributions in the amount of 5% of 1 MMS. According to the legislation, “independent payers” are individuals who pay obligatory social medical insurance contributions by themselves (that is, in cases in which the contributions are not administered by an employer), including Kazakhstan citizens who left Kazakhstan.
D. Tax filing and payment procedures
The tax year in Kazakhstan is the calendar year.
Tax filing by a tax agent. A tax agent is responsible for withholding and remitting income tax from payments made to resident and nonresident individuals.
If employment-related, Kazakhstan-source income is paid outside Kazakhstan, the local tax agent is generally still required to run a shadow payroll. Income is generally considered to be from a Kazakhstan source if it is paid for work performed in Kazakhstan and, accordingly, regardless of where it is paid, it is subject to tax in Kazakhstan.
Under the withholding mechanism, a tax agent withholds actual personal income tax on a monthly basis no later than the date on which the income is paid and remits the tax to the Kazakhstan state budget not later than 25 calendar days after the end of the month in which income was paid. The tax agent must file a personal income tax and social tax report, which includes pension fund contributions, professional pension fund contributions and social and medical insurance contributions, on a quarterly basis by the 15th of the second month following the reporting quarter.
There is also a special set of rules regulating the taxation of foreign travelers when the foreign service provider sends its employee to a Kazakhstan customer for a short period of time. The local legislation states that, for up to 183 calendar days, each foreign individual must report the salary attributed to the working days in Kazakhstan, even for several days. For this purpose, the individual is required to get an Individual Identification Number in Kazakhstan and file a personal income tax return with the possibility of treaty exemption (if a double tax treaty with Kazakhstan is available). If that threshold is not met (that is, the foreign individual spent 183 or more calendar days in Kazakhstan), the local customer would become liable for taxation of the foreign employee’s salary and run shadow payroll (that is, the local company takes the salary payment outside Kazakhstan and processes it via local payroll for Kazakhstan tax purposes). In this case, the local customer would need to get all the supporting documents. If the local customer fails to get these documents, the
The following are the sanctions for concealing taxable items:
• First time: a fine of 200% of tax payable for each concealed taxable item
• Repeated violation within a year: a fine of 300% of tax payable for each concealed item
Tax registration of foreign nationals in Kazakhstan. The following are the most common cases in which a foreign national must be registered as a taxpayer in Kazakhstan:
• When opening accounts with local banks
• On receiving Kazakh-source income not taxed at source in Kazakhstan
• On acquiring Kazakh tax resident status
• When appointed as the head of a resident legal entity in Kazakhstan or the head of a branch of a nonresident legal entity
Tax registration must take place at the foreigner’s location of residence. By law, tax registration should take five business days. Currently, the process of tax registration online has been suspended for foreign individuals.
Universal declaring. Starting from 2021, Kazakhstan is gradually introducing universal declaring (UD) for certain categories offered to all Kazakhstan citizens, gradually adding different groups of people, starting with public officials. A major part of the population will participate in the UD starting in 2025. Declaration on assets and liabilities should be submitted only once (with few exceptions) by all obliged individuals by the established deadline indicating, among other items, the following information:
• Immovable property (land, house and apartment)
• Vehicles (car, air transport and sea transport)
• Participation interest in the authorized capital of a legal entity
• Money on foreign bank accounts registered outside of Kazakhstan exceeding approximately 1,000 MCI in total
• Participation in agreement on equity participation in the construction of real estate (mostly applicable within Kazakhstan)
• Investment gold
• Securities or derivative financial instruments
• Shares in open-end funds
• Objects of intellectual property and copyrights
• Accounts receivable or accounts payable (amounts due to the individual and/or financial institution specified in the respective document and that have not been paid yet)
• Property transferred to trust management
• Cash up to approximately 10,000 MCI
• Other property
On submission of declaration of assets and liabilities, declaration on income and property will have to be filed on an annual basis justifying changes in net wealth of the declarant.
Declaration on income and property should be submitted in the following years by all obliged individuals by the established deadline. The declaration should include, among other information, the following items:
• Income received during the calendar year, including outside Kazakhstan
• Tax deductions
• Acquisition, alienation and/or receipt free of charge of property subject to state or other registration, as well as property for which rights and/or transactions are subject to state or other registration, including outside Kazakhstan
• Securities whose issuers are registered outside Kazakhstan
• The share of participation in the authorized capital of a legal entity registered outside Kazakhstan
E. Double tax relief and tax treaties
Under the Tax Code, income tax paid outside Kazakhstan by tax residents may be credited against the income tax payable in Kazakhstan on the same income, but may not exceed the amount of Kazakhstan tax accrued. To apply for a foreign tax credit, a document confirming income received and income tax paid or withheld must be enclosed with the Kazakhstan tax return. The document must be issued and/or verified by the foreign tax authorities.
An individual receiving Kazakhstan-source income who meets the conditions of a double tax treaty may apply a treaty exemption if the individual provides one of the following types of documents confirming the residency status of an individual in a double tax treaty jurisdiction issued by the competent tax authority:
• Original of the document verified by the competent state authority and legalized as per Kazakhstan legislation.
• Duly notarized copy of the document mentioned in the first bullet above. The notary signature and stamp should be legalized as per Kazakhstan legislation.
• Paper copy of the electronic document confirming the residency status published on the internet resource of the competent state authority.
Kazakhstan has entered into double tax treaties with the following jurisdictions.
Armenia Ireland Saudi Arabia
Austria Italy Serbia
Azerbaijan Japan Singapore
Belarus Korea (South) Slovak
Belgium Kyrgyzstan Republic
Bulgaria Latvia Slovenia
Canada Lithuania Spain
China Mainland Luxembourg Sweden
Croatia Malaysia Switzerland
Cyprus Moldova Tajikistan
Czech Republic Mongolia Türkiye
Estonia Netherlands Turkmenistan
Finland North Macedonia Ukraine
France Norway United Arab
Georgia Pakistan Emirates
Germany Poland
Hungary Qatar
United Kingdom
United States
India Romania Uzbekistan
Iran Russian Federation Vietnam
• Citizens of Albania can stay without a visa for up to 90 days within a 365-day period (if staying for more days, they must obtain a visa).
• Citizens of China Mainland, India and Iran can stay without visa for up to 14 days (in total no more than 42 days within a 180-day period).
• Hong Kong SAR citizens can stay up to 14 days (if staying for more days, they must obtain a visa).
• Korea (South) citizens can stay without a visa for up to 30 days, but not more than 60 days within 180-day period (if staying for more days, they must obtain a visa).
In practice, Kazakhstan migration authorities consider the visafree regime to be applicable only in cases in which individuals arrive for tourist or private purposes. Otherwise, depending on the purpose of arrival, they will be required to obtain a visa (for instance, visa B-2 for business purposes).
Starting from 2020, temporary stay of foreign individuals arriving in Kazakhstan under the visa-free regime (including the above jurisdictions) should not exceed 30 calendar days from the day of crossing the border of Kazakhstan and in total not more than 90 calendar days in each 180-calendar day period if other rules are not envisaged by the agreement concluded by Kazakhstan with the foreign jurisdiction.
Post-arrival registration. The inviting party must notify the MIA within three working days of arrival of the foreign individual in Kazakhstan and notify the MIA if the foreigner changes his or her temporary place of residence in Kazakhstan or travels to another city.
The records of immigrants are currently kept by the MIA based on the information provided by the inviting parties and the National Security Committee of Kazakhstan, and information from the border control of Kazakhstan.
A permit for temporary stay will allow the foreign individuals to stay for the certain period (for example, the length of the labor agreement), and it should be obtained by the inviting party. The permit for temporary stay is formalized based on the applications from the following:
• Individuals inviting foreign individuals for family reunion
• Individuals or legal entities having concluded labor agreements with the foreign individuals
• Education organizations
• Medical organizations
• Religious organizations
• Local authorities inviting individuals (business immigrants) for the performance of entrepreneurship activities
As a general rule, the period of stay in Kazakhstan ends on the expiration of the visa, after 30 calendar days under the visa-free regime or on the end of the period indicated in the permit for temporary stay in Kazakhstan. Kazakhstan legislation provides for several sanctions for noncompliance with the immigration requirements. For further details, see Section H.
G. Work permits
Types of work permits. The following are the two types of permits allowing foreign individuals to work for a company in Kazakhstan (this does not include labor migrants engaged as household employees):
• A work permit for hiring a foreign labor force obtained by the employer.
• A permit issued to a foreign individual who independently arrived in Kazakhstan to work in a particular specialty (Permit for Employment). The government approves the list of such specialties. The permit allows the individual to eventually get hired by the company in Kazakhstan.
The employer obtains the work permit through the submission of the documents to the local authorities under two main procedures, which are the general regime and intra-corporate transfer.
General regime
Work permit quota. Work permits are issued by the local authorities within the quota allocated by the Ministry of Labor and Social Protection on an annual basis. The quota is the maximum number of foreign individuals who can be hired to work in Kazakhstan for different regions. The quota is mainly formed based on the annual applications of employers due by 1 October.
Ratio requirement. For the purpose of obtaining a work permit under the general regime, all foreign individuals are classified into the following categories:
• Category 1: Chief-executive officers (CEOs) and deputy CEOs of companies
• Category 2: Leaders of business divisions/departments
• Category 3: Professionals
• Category 4: Qualified workers
There is a restriction on the number of foreign employees that can be hired by a Kazakhstan employer/local host entity, which is the so-called “ratio requirement.” Currently, the total number of foreign employees of a Kazakhstan employer/local host entity should not exceed the following:
• 30% of the total number of the Category 1 and Category 2 employees.
• 10% of the total number of Category 3 and Category 4 employees.
An exemption from the ratio requirement applies to small business enterprises, government enterprises and agencies, selfemployed foreign individuals, work permits issued within the limits of a quota by jurisdictions of origin if international agreements on cooperation in labor migration and social protection of working migrants ratified by Kazakhstan are in place, and representative offices and branches of foreign legal entities with at most 10 employees.
State duty. When obtaining or extending work permits, an employer is charged a state duty for the issuance or extension of the work permit. The amount of the duty is established by the government of Kazakhstan and depends on the type of business of the employer and the category of the foreign employee. The amount of state duty ranges from approximately USD950 to
supporting documents as required by legislation of Kazakhstan, and individuals hired by a national managing holding in the capacity of members of the board of directors
• Holders of an investor visa, excluding family members and dependents
H. Sanctions for noncompliance with the immigration legislation
Kazakhstan legislation provides severe sanctions for inviting parties and foreign citizens for noncompliance with the migration legislation. The upper end of administrative sanctions applied to a company can reach USD7,500 (per foreign individual per violation). The worst-case scenario can include administrative custody for up to 15 days or administrative deportation of the individual from the country and a company being banned from engaging any foreigners for up to one year (that is, no issuance of a work permit and no acceptance of a letter of invitation from the company for a visa application). Foreign individuals are not allowed to enter Kazakhstan for five years after the administrative deportation from Kazakhstan.
I. Residence permits
Kazakhstan issues residence permits. No quota system is in effect for immigration into Kazakhstan under residency permits.
J. Family and personal considerations
Family members. The spouse of a holder of a Kazakhstan work permit does not automatically receive the same type of work permit. If he or she wishes to undertake employment, a work permit application must be filed independently.
Driver’s permits. Foreign nationals may drive legally in Kazakhstan with their international driver’s licenses. Foreign jurisdiction driver’s licenses are valid in Kazakhstan if they comply with 1968 Vienna Convention on road traffic. However, an official Russian or Kazakh translation of the foreign driver’s license by a confirmed translator is required; therefore, it is advisable to have an international driver’s license.
Kazakhstan has driver’s license reciprocity with some of the Commonwealth of Independent States (CIS) countries, including, but not limited to, Belarus, Kyrgyzstan, the Russian Federation, Ukraine and Uzbekistan.
A foreign individual may obtain a Kazakhstan driver’s license after passing written, practical and medical examinations.