Taxes and taxation. Educational manual 9786010401099

The purpose of the educational manual is to help deepening and systematize the knowledge in the tax area. The educationa

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Taxes and taxation. Educational manual
 9786010401099

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AL FARABI KAZAKH NATIONAL UNIVERSITY HIGH SCHOOL OF ECONOMY AND BUSSINESS DEPARTMENT OF FINANCE

Bayan Ermekbaeva Rimma Sagieva Raigul Doszhan

TAXES AND TAXATION Educational manual

Аlmaty «Kazakh university» 2013 1

UDC 336.22 BBK 65.261.4 E 729

Recommended by the Academic Council of the High School of Economy and Business, and Editorial and Publishing Council of KazNU

Reviewers: Doctor of Economic Sciences, professor Sagyndyk Satybaldin Doctor of Economic Sciences, professor Vladimir Melnikov

Ermekbaeva B. at all E 729 Taxes and taxation: educational manual / B. Ermekbaeva, R. Sagieva, R. Doszhan. – Аlmaty: Kazakh university. High school of economy and business, 2013. – 122 p. ISBN 978–601–04–0109–9 The purpose of the educational manual is to help deepening and systematize the knowledge in the tax area. The educational manual «Taxes and taxation» aimed at undergraduate degree in finance, also enterprise managers and individuals, which interested in tax reporting. UDC 336.22 BBK 65.261.4 © Ermekbaeva B., Sagieva R., Doszhan R., 2013 © KazNU al-Farabi, 2013

ISBN 978–601–04–0109–9 2

CONTENTS Introduction .......................................................................5 Section I

Taxes on income ................................................................6 Theme №1. Individual income tax ......................................6 Theme №2. Social tax .........................................................16 Theme №3. Corporate income tax ......................................23

Section II Property Taxes ..................................................................37 Theme №4. Land tax...........................................................37 Theme №5. Property tax .....................................................46 Theme №6. Vehicle tax ......................................................54 Section III Taxes on consumption ......................................................59 Theme №7. Value-added tax ..............................................59 Theme №8. Excise tax ........................................................74 Theme №9. Tax on gambling .............................................85 Theme №10. Rental tax for export ......................................87 Theme №11. Fixed tax ........................................................89 Section IV Taxation of the subsoil users ............................................92 Theme №12. Special payments of subsoil users .................92 Theme №13. Excess profits tax ..........................................95 Section V Special tax regimes (STR) ................................................102 Theme №14 Special tax regimes for small businesses........103 Theme №15. The special tax regimes for legal entities-agricultural producers.............................................108 Theme № 16. Special tax regimes for peasant farms ..........110 Additional tasks ......................................................................................113 References ............................................................................................121

Abbreviations 1

MCI

2

MW

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

TC MPC TI CIT IIT TAI VAT ST SC I SSIF SSA IE LLP MET STR c.c

Monthly calculated index defined in the Act, «the Republican budget» for the year Minimum wage specified in the Act «Republican budget» for the year Tax Code Mandatory pension contributions Taxable income Corporate income tax Individual income tax Total annual income Value added tax Social tax Social contributions Inventory State Social Insurance Fund State social assistance Individual entrepreneur Limited liability partnership Mineral extraction tax Special tax regime Cubic centimeter

Introduction One of the most important tools of the government's economic policy implementation were always and continue to be the taxes. In connection with this, the knowledge of the tax legislation, procedure and conditions of its functioning is the essential condition for the society. The purpose of this study guide is a delivery of the assistance in deepening and systematization of the knowledge in the tax area. The authors' task is first of all to give a clear idea of the essence of the taxes, the main types of taxes, the tax system in general and its role in the economic development of the society. For the solving of this issue in the study guide the operating in Kazakhstan tax system is considered, a variety of materials for use of the current tax legislation is systematized. The content of the study guide is strictly based on the normative documents, legislation and regulation documents are given as of January 1, 2011. For the solid understanding of the given in the tutorial material, each theme in all sections completed by the checklist and the corresponding tasks. The study guide is intended for the students of the economic universities and faculties during the learning of the course «Taxes and taxation.» The study guide also gives a complete view of the procedure of the calculation and payment of specific taxes, set by the law benefits and conditions of their use, and a number of other important issues related to the taxation.

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Section I. Taxes on income Theme № 1. Individual income tax Individual income tax - one of the most famous and widespread taxes. Refers to the direct and personal taxes, is included into a tax group on income and is the source of income of local budgets. It covers a large part of the population of a country. The economic essence of this tax is presented in its regulation, as the level of social production and consumption and income levels. Payers  Payers of individual income tax are individuals having the objects of taxation, determined in accordance with Art. 155 of the Tax Code.  Payers of the fixed tax on gambling, do not pay personal income tax on income from the type of the activities pointed out in Art. 411 and 420 of the Tax Code.  Individual entrepreneurs,who are using a special tax regime for peasant and individual farms do not pay individual income tax on income from activities covered by this special tax regime. Taxable items  Income taxed at source  Income not taxed at source. The tax rates  The income of taxpayer is taxed at a rate of 10 percent.  Incomes from dividends has obtained from sources in the Republic of Kazakhstan and abroad are taxed at the rate of 5 percent. Taxable period  The tax period for the calculation by the tax agents of the individual income tax on income taxed at source, is a calendar month.  It is necessary to pay tax over paid income calculated by the tax agents from the source of taxation by the 25th of the month following the month of payment, the place of its location. 6

Terms of IIT payment by the tax agents who are using a special tax regime for small businesses based on the simplified declaration and the peasant or individual farms, are set within the framework of an applied special tax regime.  By taxpayers - residents the tax for the tax period it should be payed no later than 10 calendar days after the deadline for delivery of the declaration at the location (residence).  Individual entrepreneurs applied a special tax regime for small businesses based on the base of the patent or the simplified declaration should pay the individual income tax on income taxable within these special tax regime. Declaration of individual income tax. Form № 200.  declaration of individual income tax are is submitted by the following resident taxpayers: 1) individual entrepreneurs; 2) private notaries, private bailiffs, attorneys; 3) Individuals who receive property income; 4) individuals who receive other income, including income outside of the Republic of Kazakhstan; 5) individuals who have money in bank accounts in foreign banks located outside the Republic of Kazakhstan.  Deputies of the Parliament of the Republic of Kazakhstan, the judges, as well as individuals who are responsible to submit a declaration in accordance with the Constitutional Law of the Republic of Kazakhstan «On Elections in the Republic of Kazakhstan», the Criminal-executable Code of the Republic of Kazakhstan and the Republic of Kazakhstan Law «On Fight against Corruption» submit a declaration of income and property being a subject of taxation, and located both on the territory of the Republic of Kazakhstan and beyond.  Individual entrepreneurs applying a special tax regime for small businesses based on the patent or simplified declaration according to income included in the object of taxation in accordance with Art. 427 of the Tax Code, the declaration of individual income tax do not represent. 7

Deadlines for submission of declarations  The declaration of individual income tax to the tax authority at the location (address) is submitted no later than March 31 of the year following the tax reporting period, except for the cases stipulated by the Constitutional Law of the Republic of Kazakhstan «On Elections in the Republic of Kazakhstan» and the Law of the Republic of Kazakhstan «On the fight against corruption». Checklists 1. What are the subjects and objects of the individual income tax? 2. What are tax rates on the individual income tax? 3. Who has to submit a declaration of individual income tax? 4. Call deadlines for submission and terms of payment of individual income tax? 5. How the individual income tax is calculated? 6. Who calculates the IIT? Task № 1. Required: 1. Determine the subject of taxation of individual income tax. 2. Sum of individual income tax. An employee Karimov Arman - the manager of the company has the income in the form of wages for the year 2011 in the sum of 2 200 000 tenge. In May, he was in the hospital for 20 days, he was accrued to payment 15 000 tenge. The financial assistance for the operation in the sum of 140 000 tenge was provided. Were reimbursed travel expenses 255 600 tenge for 10 days in Kazakhstan (travel 80 000, meals – 75 600, accommodation - 100 000), the rate of daily consumption is derived as 5 MCI per day. In June Arman visited advanced training sales courses at the cost of 55 000 tenge. In July, Armand was on vacation 18 days - 120 000tenge. In August, Arman sent a kid to a children's cams. Son is 17 years old, the price for the camp ticket is 45 000 tenge. Arman also has a bank account and received a reward of 50 000 tenge for 2011. Solution (2011): Employee income: Art156, 163 8

Salaries 2 200 000 Hospital 15 000 Financial assistance to 140 000 - (8 * 15 999) = 12 008 Selling 120 000 Kids camp ticket 45 000 Total income 392 008 Deductions: Art. 166 MPC 239 201 MW (12 * 15 999) 191 988 Total deductions 431 189 Taxable income 1 960 819 The sum of IIT, Art. 158 196 082 Task № 2. Define: Ivanov’s taxable income -The sum of mandatory pension contributions -The sum of the individual income tax. Sergei Ivanov's salary in year of 2012 was accrued in the sum of 3 710 000 tenge. During the year, Ivanov received the construction materials in sum of 75 000 tenge for the hous repair. He moved with the organization and within 30 days from the time of movement he confirmed his expencies at the sum of 280 000 tenge. In July, Ivanov was sent on a business trip to Astana for 4 days, he was given under accountability 63000 tenge. Upon arrival from a trip he had made an advance report where according to the submitted documents the following expenses were listed: -Round trip / tickets / 16000 -Bills from hotel 10000 - daily allowance/checks / 37000 At a rate of daily expenses 4 MCI per day In August, a son of Sergei was born, and he was given a one-time financial assistance of 130000 tenge (all documents are prepared accordingly). In September, Sergei took advanced training courses costing 35 000 tenge. 9

Sergei paid the costs on remuneration of credit issued in Zhilsotsstroybank to buy an apartment in the sum of 250 000 tenge. There was accrued interest on unpaid pension deductions in the sum of 32 000 tenge. Sergey won the lottery 150 000 tenge. Sergey also received a gift from his father, a car «Mazda -626» worth $6500 U.S. dollars. On the day of donation the currency rate of $1 U.S. dollar was 147,5 tenge. He donates voluntary pension contributions on a monthly basis for his spouse in the sum of 5000 tenge (the wife does not work and is a husband’s dependant). Solution (2011): Employee income: Salaries 3710000 Repair of housing 75000 Daily costs 37 000 - (4 * 1512 * 4) 12808 Mat. assistance 130 000 - (8 * 15 999) 2008 Lottery 150 000 – 8000 142000 Total income 3 941 816 Deductions: MPC (3,941,816 - 142 000) * 10% 379 982 MW (12 * 15 999) 191 988 Remuneration 250000 Total deductions 821970 Taxable income 3119846 Sum IIT 311985 Task № 3. Determine: the sum of individual income tax using the tax deduction for the period from January to March 2011. Employee for the month of January was accrued salary in the sum of 16000 tenge. In February, he took a vacation without payment for family reasons and had no accrued income. In March he was accrued income 20 000 tenge. Solution (2011): In accordance with s. 2 of Art. 166 TC of RK (cumulative total of unused deduction) calculation will be the following: January, 2011 MPC 16000x10% = 1600 10

IIT 16000-1600-15 999 = -1599 IIT = 0 because there is no taxable income February 2011 IIT is absent since there is no accrued income, and therefore a tax deduction is not applied. March 2011 MPC 20000x10% = 2000 IIT 20000-2000-15999 - 1599 (accumulated deduction from January) = 402x10% = 40,2 Task № 4. Determine: the sum of personal income tax for the employee in November 2011, due to obtaining of material and social benefits. The Company at its own expense provides their employee by meals via a contract with the public catering. In order to control the assimilation of funds on employee’s meal there are token coins for meal with the employee’s name. For November 2011 Ivanov received 20 token coins at 1000 tenge each. In addition to that the employee was accrued the wage in the sum of 50000 tenge. Solution (2011): The cost of providing their employees with free meals are personalized (ie, defined for each individual), i.e the employer can set the end user of the material and social benefits. They are considered as employees’incomes received in the form of material, social benefits and other material benefit, and are subject of taxation IIT and social tax. 20000 + 50000 = 70000 MPC 70000x10% = 7000 IIT 70000-7000-15 999 = 47001 x10%=4700,1 Task № 5. Determine: the sum of personal income tax of employee for December 2011 in connection with obtaining of material benefit. Out of 200000 tenge, issued to him for the representative expenses, in advance report he proved documentarily only expenses in the sum of 180 000 tenge. Solution (2011): 11

Representative expenses are included in the list of payments not considered as income; funds granted for this purpose to employee, documentarily proved, are not included in his calculated income. Only in the case when an employee has not confirmed the cost by original documents the unconfirmed sum will be taken into account to be its income for tax purposes. The documentarily proved representative expenses of the economic entity, in according to the summary of the year in deductions will be considered after the fact, but not more than 1% of the cost of the employer for payment to the employee at the same time the incomes of employees are determined in accordance with the provisions of s.2 of Art. TC 163, in the employee's income it is taken in to account all expenses of the employer in the form of wages, social and material benefits given to employees, either in the form of material benefit. Expenses not documentarily proved should be included in the employee's income for tax purposes. MPC 20000x10% = 2000 IIT 20000-2000-15 999 = 2001x10% = 200,1 Task № 6. Determine: the sum of personal income tax to employees for December 2011 in accordance with compensation during business trips. I. In November 2011 the employee was sent for 45 days to Astana. Daily costs were calculated and paid - 45 days x 4MCI x 1413tenge. Solution (2011): s.1 ss.4 s 3 Art.. 155 the employee’s compensation of travel expenses for 40 days will not be treated as taxable income. Exceeding of this norm will be taxed IIT: 30240 x = 5days x 4MCI x1512 MPC 30x240x10% = 3024 IIT 30 240-3024 -15 999 = 11217x10%=1121,7

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II. In December 2011 the employee was sent for 10 days to Astana. Daily costs were calculated and paid - 10 days x 8MCI x 1512tenge. The solution: s.1 ss.4 s 3 Art.. 155 the employee’s daily costs not exceeded 6-time MCI within Kazakhstan will not be treated as taxable income. Exceeding of this norm will be taxed IIT: 30240 = 10days x2MCIx1512 MPC 240x10 30% = 3024 IIT 30 240-3024 -15 999 = 11217 x10%=1121,7 Task № 7. Determine: the sum of personal income tax to employees for December 2011 due to costs related to corporate entertainment. For the collective action of the company due to the New Year (Christmas tree, toys, banquet, theater, fireworks, fire management) company took expenses in the sum of 500 000 tenge. The solution: s.i.8 s.3 Art. 155 of the TC, the employee’s costs not related with the profitable activity and not deductible if they are not distributed among specific individuals then are not considered as income of individuals Task № 8. Determine: the sum of personal income tax to employees for December 2011, over the compensation costs related to transfer of the employee to another area. Legal entity opens a branch in another city and direct his employee to work in a company branch. Documented costs were: For travel 58 000 tenge; transport of private assets (container) 15000 tenge; hotel accommodation 40 days 160 000 tenge. Solution (2011): s.i.8 s. 3 Art. 155 TC, the compensation of costs for employee associated with the transfer of him to work in another place will 13

not be treated as income. All costs associated with the move, transportation of property, renting rooms for 30 days. Since the restrictions only on the calendar days of room rent, then the 10 days of exceeding each of 4000 tenge (160000:40 = 4000) - is 40 000 taxable IIT MPC 40000x10% = 4000 IIT 40000-4000-15 999 = 20001x10%=2000,1 Task № 9. Determine: the sum of individual income tax to employees for December 2011 on insurance payments. The employer has insured his office employee against accident during his job duties under the contract of mandatory insurance of 2 December 2011. The sum of insurance 5000tenge December 10, 2011 accident happend, and By December 28, 2011 insurance payment was made to the employee in the sum of 180 000tenge The solution: Insurance payments are made for contracts of mandatory insurance of employee against accidents during of job (service) duties, signed between employer and employee in accordance with the legislative act of Kazakhstan regulating the mandatory insurance. The sum of insurance, as well as the paid sum of insurance compensation for tax purposes by the employee will not be treated as income, i.e. not be included in the calculation of the income. It will be taken into account only within the s.3 art. 155. Task № 10. Determine: the sum of individual income tax of employee for December 2011 for compensation of expenses of the individual who is considered as the landlord. The company filled a car rental agreement with the individual who is an employee of the company at the same time in the sum of 50 000 tenge. During the operation of the car the gasoline was used, car’s oil and filter were replaced in the sum 20000 tenge. Solution (2011): 14

In this situation, the employee's income will be rental fee. Other costs of renter in connection with the operation of the leased property from an individual s.s.24, s.3 Art. 155 TA should not be treated as the income of a individual considered as the landlord. IIT: MPC 50 000x 10% = 5000 IIT 50 000 – 5000 – 15 999 = 29 001х10%= 2900,1 Task № 11. Determine: the individual income tax sum of incomes for certain categories of individuals. Employee, a member of military operations in Afghanistan, for the year was accrued income of 1 800 000 tenge. Solution: In 2011 the employee’s income has to be freed from taxation IIT in the sum of 822360 tenge (55MWx14952.) The sum of excees of the income over the defined benefit 977640 (1 800 0008223 60), will be taxed in the normal manner. IIT: MPC 977 640х10%= 97 764 IIT 977 640 – 97 764 -15 999 = 863 877х10%= 86 387,7 \

Theme № 2. Social tax Payers  legal entities - residents of the Republic of Kazakhstan,  nonresidents conducting business in the Republic of Kazakhstan via a permanent establishment, branches and representative offices of foreign legal entities;  individual entrepreneurs, with the exception of using special tax regimes, except for the special tax regime for certain types of activities;  private notaries, lawyers.  divisions by decision of the legal person may be considered as social tax payers. The object of the social tax taxation  For legal entities - the cost of employer paid to employees, residents and non-residents in the form of income and the income of foreign staff, and payments to individuals according to the contracts of paid services.  For private lawyers, attorneys - number of employees, including payers themselves. The object of social contributions:  For the employer - the cost paid to the employee in the form of income;  For individual entrepreneurs, except for the ones applied a special tax regime, private notaries and lawyers - their income, but not more than ten times of the minimum wage;  For individual entrepreneurs, using special tax regimes - the size of the minimum wage.  Social contributions payable to the Fund for the participants of the mandatory social insurance are set at: - from 1 January 2009 - 4% from the object of calculation of social contributions; - from 1 January 2010 - 5% from the object of calculation of social contributions.  For self-employed persons who are subject to special tax regime in accordance with the tax laws of the Republic of 16

Kazakhstan, the sum of social contributions paid by them to their advantage, is: - from 1 January 2009 - 4% of the object of calculation of social contributions, but not less than 4% of the minimum wage set by the law on the national budget for the according financial year; - from 1 January 2010 - 5% from the object of calculation of social contributions, but not less than 5% of the minimum wage set by the law on the national budget for the financial year. The maximum sum of social contributions for the self-employed persons has not to exceed the sum of calculated social tax for the accounting period. are not object of taxation of social tax  Payments made via grants given by states, governments and international organizations, state awards, scholarships, money prizes awarded for the top places, compensation payable after termination of an employment contract, under the call for military service, compensation paid by the employer to employees for unused vacation, mandatory pension contributions, voluntary professional pension contributions to pension funds. Social tax rate  For legal entities-residents of the Republic of Kazakhstan, as well as non-residents operating in the Republic of Kazakhstan via a permanent establishment of branches and representative offices of foreign legal entities that pay social tax rate of 11% of taxable income paid by the employer.  Individual entrepreneurs, with the exception of those applying special tax regime, except for the special tax regime for certain types of activities, private notaries, lawyers pay social tax in the sum of two monthly calculated indices for himself and one monthly index for each employee.  Specialized organizations that employ disabled people with disorders of the musculoskeletal system, loss of hearing, speech, vision pay social tax at a rate of 4,5%.  for legal entities and individual entrepreneurs, using special tax regimes are considered by us in the «Special tax regimes» section 17

 Calculation of social tax is made by applying the rates reduced by the sum of social contributions to the State Social Insurance Fund, calculated in accordance with the legislation act of the Republic of Kazakhstan on mandatory social insurance, to the object of taxation to social tax for the tax year. In the year of 2011, the rate of social contributions equals to 5% of the gross salary substracting mandatory pension contributions.  If the total sum of accrued income to the employee during the calendar month less than the minimum wage set for the according financial year by the law on the national budget, then the object of taxation of social tax is determined according to the minimum wage. Order of tax procedure  social tax is paid no later than the 25th day of the month following the reporting month, at the place of registration of the taxpayer. Taxable period  Tax period - calendar month. The tax return for ST  Declaration on social tax is submitted to the tax authorities on a quarterly basis no later than the 15th day of the second month following the reporting quarter. Checklists. 1) Who are the social tax payers? 2) What is the basic rate of social tax? 3) What is the object of taxation of social tax? 4) Which organizations are eligible for rate of 4,5%? 5) Who is responsible for the payment of the social tax? 6) What is the period of submission of the declaration of social tax? 7) What is the object of social contributions? 8) What is the size of social contributions? 9) What is the date of payment of social contributions?

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Task № 1. Private attorney services rendered to the population in the sum of 250,0 thous. tenge for the first quarter of the year 2011. What is the sum of social tax for the period, if the salary of its two employees is 30,0 thous. tenge? Solution (2011): Art. 358 s. 2. Individual entrepreneurs, except for using special tax regimes, private notaries, private bailiffs, lawyers pay social tax is 2-time MCI established by law on the state budget at the date of payment, for themselves and in the 1-time MCI for each employee. Tax provision of paragraph is not applies to the taxpayer during the period of temporary suspension of tax reporting in accordance with Art. 73 of the Tax Code. ST = (4 * 1512) * 3 = 18 144 Task № 2. LLP «Joy» accrued for the March 2011 wagel in the sum of 1 250 000 tenge, including 650 000 tenge, employee’s salary over disability with hearing loss. Social tax for the month of March 2011will be: The solution: Art. 358 s. 3. Specialized organizations that employ people with disabilities in violation of the musculoskeletal system, loss of hearing, speech, vision, and meet the conditions of paragraph 3 of Art. 135 of the Tax Code, have to pay social tax rate of 4,5% ST = (1 250 000 - 125 000) * 4,5% = 50625 Task № 3. Individual entrepreneur, not using a special tax regime, has no employees. MCI - 1512 tenge. What is the total sum of social tax and social contributions paid for an year? Solution (2011): Art. 358 s. 2. Individual entrepreneurs, except for using special tax regimes, private notaries, private bailiffs, lawyers pay social tax is 2-time MCI established by law on the state budget at the date of payment, for themselves and in the 1-time MCI for each employee. Tax provision of tax paragraph is not applied to 19

the taxpayer during the period of temporary suspension of tax reporting in accordance with Art. 73 of the Tax Code ST = 12 * 2 * 1512 = 36288 Task № 4. At end of year, the company accrued wage to the employee for December - 30 000 tenge and bonus on results of the year - 50 000 tenge, and paid for a ticket to the sanatorium - 35 000 tenge and paid dividends in the last year - 50 000 tenge. Company commitment to pay the social tax and social contributions will be: The solution: Art 358s.1. Except as otherwise provided by this article, the social tax is calculated at the rate of 11%, Art.163-165. ((30 000 50 000 35 000) - 11 500) * 11% = 11 385 tenge Task № 5. LLP accrued wages to the employee for a month 14 000 tenge. Specify the sum of the calculated social tax and social contributions for the month: The solution: Art. 357 s. 2. If the object of taxation determined in accordance with s. 1 Art. 357 of the Tax Code for the calendar month less than the minimum wage set by the law on the state budget and acting on the last day of such calendar month, then the object of taxation by the social tax is determined on the basis of minimum wage, Art 358 s.1. Except as otherwise provided by this article, the social tax is calculated at the rate of 11%. ( 14 000 – 1 400) < 15999 * 11%= 1760; 12 600* 5% =630 ST - 1760 tenge, SC - 630 tenge Task № 6. During financial year of 2010, the Company got the following expenses: - Wage for employees 15 220 000 - Payment for overtime, weekends and holidays 420 000 - Bonuses to workers and employees 309000 - 1-time payments from its own funds 120000 20

- Financial help 390000 - Compensation for the termination of the employment contract 150000 - The cost of the employer for training and advance qualification of employees in specialty 241000 - Compensation for business trips 330000 including within the rules 156000 174000 - Costs for payment of medical services (other than cosmetic) confirmed by documents 270 600 - addressed social help for pensioners (for not employees of the company) 50 000 - Purchase of tickets to children's summer camps for kids, 220 000 Including children under 16 years of age 121 000 99 000 Required: - Find the sum of the cost of the employer, taxable by social tax, and calculate the sum of social tax. The solution: 15 220 000 +420 000 +309 000 +120 000 +390 000 + (330 000156 000) + (220 000-121 000) = 16 732 000 – 1 673 200 = 15 058 800 * 11% = 1 656 468 Task № 7. LLP «Rahkat» made in 2011 following payments to the employee Ilyasov Dinmukhamet.: - Wage 840 000 tenge - Financial assistance in connection with the birth of a child 25 000 tenge - payment according to illness form 20 500 tenge - Holiday 140 350 tenge - Award close to the holiday dates 25 000 tenge - it is paid for meals in the dining room 15 800 tenge - Medical cosmetician service 25 000 tenge - Voluntary life insurance 25 000 tenge - Medical services due to company’s operational needs – 15 000 tenge 21

Determine the sum of IIT, social tax, social contributions and mandatory pension contributions. Solution (2011): 840 000 + 20 500 + 140 350 + 25 000 + 15 800 + 25 000 + 25 000 = 1 091 650 Income 1091650 Deductions: MPC 109165 MW (12 * 15 999) 191 988 Total deductions 301153 Taxable income 790497 IIT 79050 Social tax 1 091 650-109 165 = 982 485 * 11% = 108073 39299 = 68774 (payable) Social contributions 982 485 x 5% = 49124 Task № 8. Employee quits the jobafter third day of month. He is accrued the sum of: - Salary for days worked 5000tenge; - Compensation for unused vacation 21000tenge. Determine: the sum of social tax of 11%. Solution (2011): Total accrued 26000tenge. During the determination of the object of taxation it is necessary to exclude from income accrued compensation for unused vacation and pension contributions: 26000-21000-500 = 4500 The object of the social tax is lower than the minimum wage. Art. 357 s. 2. If the object of taxation determined in accordance with s.1 Art.357 of the Tax Code for the calendar month is less than the minimum wage set by the law on the state budget and the acting on the last day of such calendar month, then the object of taxation by social tax is determined on the basis of minimum wage, so the social tax has to be calculated according to the minimum wage: 15 999х11%= 1759,8

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Theme № 3. Corporate income tax Payers  corporate income tax payers are legal entities - residents of the Republic of Kazakhstan, except for government agencies and non-resident legal entities operating in the Republic of Kazakhstan via a permanent establishment or receiving income from sources in the Republic of Kazakhstan.  Legal persons applied a special tax regime based on simplified declaration, calculate and pay corporate income tax on income taxable under this regime, in accordance with Chapter 61 of the Tax Code.  Payers of gambling, the fixed tax do not pay corporate income tax on income from the the activities mentioned at Art. 411 and 420 of the Tax Code. The taxable objects  The objects of corporate income tax are: 1) taxable income; 2) income taxable from source of payment; 3) the net income of the foreign legal entity, operating in the Republic of Kazakhstan via a permanent establishment. Formation of taxable income.  Taxable income is defined as the difference between corrected gross annual income and deductions considered by the Tax Code taking into account by taxable income.  The total annual income of a resident legal entity consists of all types of income to be received (received) them in Kazakhstan and abroad during the tax period. Main items of income - is the income from sale of goods (works, services), income from rental property, assets value gross, income from write-off of liabilities, gratuitously received property, dividends, interest, the excess of the positive net foreign exchange difference over the negative sum of the net foreign exchange difference, gains and other types of income. The total annual income of the taxpayer has to be corrected. So, for instance, out of income one excludes dividends received from a resident legal entity of the Republic of Kazakhstan, previously taken 23

from the source of payment in Kazakhstan and some other types of income.  taxpayer costs associated with obtaining the total annual income are to be substracted in determining taxable income, for instance the cost of bought or manufactured goods, works, services, transportation, services of utilities, amortization and repairs of fixed assets within the stated norms in groups of fixed assets, gains for the commercial loans, the cost of insurance premiums, the cost of social payments, the excess of foreign exchange difference over the positive one, costs of tax, etc. At the same time, some types of expenses are connected with substractions within the limits established by legislation – for representatives’ expenses, interest expenses, costs of tax, the cost of fixed assets (maintenance and amortization), spending on training of staff, etc.  The deductions are produced by the taxpayer having the documents proved the costs associated with obtaining the total annual income. These expenses are to be substracted in the tax year in which they are actually happend, excluding expenses of future periods. Expenses of future periods are deductible in that tax year to which they are related.  Taxable income has to be further corrected. In particular, the costs actually made by the taxpayer for the maintenance of objects of the social area, have to be excluded from taxable income in the range of 3 percent of taxable income.  Loss of the enterpreneur activities - the excess deductions over corrected gross annual income which can be propogated in the tax records for the next 10 years for the payment via the taxable income of the next tax periods. The formula calculating CIT Determine the TAI = total annual income during the tax period One makes a correction of TAI = TAI - correction One calculates TI1 = TAI - Deductions One transfers the losses:TI 2 = TI – the sum of loss One corrects TI3 = TI - correction, but not more than 3% of the TI1 One calculates CIT = TI1 or TI2 or TI3 x 20% or 10% 24

One recalculates = CIT – advanced payments Taxable period  The period to be calculated for CIT - calendar year (from January 1 to December 31) Deadlines for declaration  CIT Declaration (form № 100) consists of a declaration and appendix to it disclosing information about the objects of taxation and objects related to the taxation of CIT, and is submitted to the tax authorities no later than 31 March of the year following by the tax reporting period. The final calculation (payment - the difference between accrued advanced payments for a tax reporting period and actually calculated corporate tax) for the tax period, the taxpayer makes no later than 10 working days after March 31. Tax payment date  Taxpayers pay the corporate income tax no later than 10 calendar days after the deadline set for submission of the declaration. Checklists. 1. Who are the taxpayers and taxable items CIT? 2. How is the TI defined? 3. What organizations are non-comercial? 4. What sum of donated given property to non-comercial organizations is excluded from TI? 5. In which case, the losses are appeared? 6. How in the tax accounting the losses are propogated? 7. What are terms of payment of CIT? 8. What is the CIT rates? 9. How are advance payments of CIT determined? 10. What is the deadline for submission of the CIT declaration? Task № 1. LLP «Alpha» has income of $ 25000000 tenge for the year of 2011. Expenses were 20 million tenge. In the expenses included interest expense for the intended construction of a credit loan of 2 000 000 tenge, construction works on 31.12.2011 have not yet started. What is the sum of the CIT in 2011? 25

The solution: Art. 100 Art. 100 s. 7. CIT = (25 000 000 - 20 000 000) * 20% = 1 000 000 tenge Task № 2. LLP «Vostorg» made money assistance to the kindergarten for 120000 tenge, the company also has costs of summer camp keeping in the sum of 1 250 000 million tenge, the total annual income was 25 689 000 million tenge, allowable deductions - 23 815 000 tenge. What sum can be excluded from taxable income? The solution: 25 689 000 – 23 815 000) * 3% = 56 220 tenge Task № 3. The company «Azhar» received the 2011 taxable income of $ 2 500,0 thous. tenge, while the accountant included in allowable deductions interest expense paid during the tax period in the sum of 1 250,0 thous. tenge. Interest expense consists of 650,0 thous. tenge paid to associated companies, and the rest was paid to the Kazakhstan banks. The average annual sum of equity in the company «Arai» during this period sumed to 2 300,0 thous. tenge, and the corresponding sum on the credit loan was 46 000 thous. tenge. Are deductions properly calculated by accountant for interest? If not, then for how much one needs to make corrections over deductions for interest? The solution: According to art. 103 the sum of allowed deductions over payed interest to the related party is calculated on the basis of the ratio of average annual capital and average liabilities and multiplied by limit factor: 600 + ( 2300/46 000)*6*650 = 600 + (0,3* 650) = 600+195= 795 thous. tenge - the sum of allowable deductions 2500 - 1250 = 1250 * 20% = 250 (calculated CIT) 2500 - 795 = 1705 * 20% = 341 (corrected CIT) CIT must be assessed additionally for the sum of 91 thous. tenge (341 - 250) 26

Task № 4. The company in 2011 had income of 20 million tenge, allowable deductions 16 mln, at the same time deduction is applied for taxes calculated during the period in the sum of 1 800 thous. tenge, with the taxes paid 1300 thous. tenge. What sum has to be corrected for the corporate income tax at a rate of 20%? The solution: Correction in the sum of tenge 100000 accrual of art. 114 Task № 5. LLP «Dostyk» in the tax period received taxable income in the sum of 1 500 thous. Tenge; before inclusion of the currency exchange rate difference, a positive difference for this period was 200 thous. tenge and negative exchange difference - 700 thous. tenge. CIT sum is (20%); Solution: Art. 113 (1500 - (700 -200)) * 20% = 200 thous. tenge Task № 6. The company «Shank» has loss: year of 2007 - 100 thous. tenge, 2008 - 50 thous. tenge, 2009 - 150 thous. tenge, in 2010 - taxable income has been gotten - 75 thous. tenge. What sum of propogated losses the «Shank» will show for 2011? The solution: 100 000+50 000+150 000-75 000 = 225 000tenge Task № 7. When filling out the corporate income tax for the year 2010 by chief accountant of «Altynai», established in May 2006, were calculated TAI and deductions. The basis for these calculations the following data of the financial reporting of the Company (excluding VAT) were used: Incomes: - From sales of magazines and posters - 9300 thous. tenge; - From sales of label products - 3450 thous. tenge; - From sales of previously purchased paint and foil - 1320 tenge; 27

- Interest on bonds of Kazakhstan legal entities - 240 thous. tenge; - From sale of property and equipment included in group 3 of the FA on tax accounting - 45 thous. tenge; - Foreign exchange income on executed operations - 8 thous. tenge Costs: - Salaries of staff – 4 000 thous. tenge; - Rent of office building in the city - 460 thous. tenge; - Other documented expenses associated with obtaining income – 3 500 thous. tenge; - amortization of main assets - 1 250 thous. tenge, including; Passenger transport - 60 thous. tenge Furniture - 35 thous. tenge Office equipment - 50 thous. tenge Production building - 205 thous. tenge Production equipment - 900 thous. tenge - Maintenance of an industrial building - 400 thous. tenge. Repair is not associated with increased standard life time of the building; - Taxes to be deducted in accordance with the Tax Code of RK 1010 thous. tenge; - Fines made to the state budget for the violation of environmental legislation - 200 thous. tenge; - Fees for work training with the new printing equipment company’s employees «Altynai» by experts of the Russian company from Novosibirsk at the production plant in Almaty. Russian company has no a permanent establishment in Kazakhstan. The cost of services under the contract - 360 thous. tenge, including tax paid to the budget over non-resident income with a rate of 20%. In 2010, the company bought: - Printing equipment, the price is 2860 thous. tenge. - Computer software for accounting computers for 350 thous. tenge. The equipment will be used to obtain the TAI at least for 3 years, the software - during 2 years. Information: CIT rate - 20% The rate of amortization: 28

Group 1 - 10% Group 2 - 25% Group 3 - 40% Group 4 - 15%. Data on amortization (thous. tenge)

Value balance of the group at the end of 2009 Tax amortization for 2009

Group 1 3 200

Group 2 4 700

Group 3 500

Group 4 740

320

1 175

200

111

Required: 1. Calculate the size of the TAI for 2010. 2. Calculate the sum of the deduction in connection with the tax laws. 3. Highlight the article that can not be included in the allowed deductions. 4. Calculate the taxable income of the company «Altynai» and the sum of CIT in 2010. To all calculations provide the needed explanations. Calculations for 2010 make with all the allowed by the tax code deductions. The solution: TAI: Income from the sale of magazines and posters - 9300 Income from sales of label products - 3450 Income from the sale of previously purchased paint and foil 1320 Interest income on bonds of Kazakhstan legal entities - 240 Income from foreign exchange difference on executed operations - 8 TOTAL The total annual income - 14318 Deductions: Wages - 4000 Office rent - 460 Other costs - 3500 Repair of fixed assets - 400 Taxes - 1010 29

Training of employees - 360 Amortization expense - 2287 Total deductions - 12017 Taxable income (14 318 – 12 017) = 2301 CIT 2301 * 20% = 460 The calculation of amortization: Name Value balance at the end of 2009

Group 1

Group 2

Group 3

Group 4

Total

3200

4700

500

740

9140

Annual Amortization for the year 2009

(320)

(1175)

(200)

(111)

(1806)

Value balance at the beginning of 2010

2880

3525

300

629

7334

350

3210 45

Incoming payments Disposals

2860 (45)

Value balance at the end of 2010

2880

6385

255

979

10499

Amortization rate Amortization

10% 288

25% 1597

40% 255

15% 147

2287

Task № 8. The company «Samsam» resident of the Republic of Kazakhstan, is saling goods on the market of Kazakhstan. Performance of the company in 2010 is: 1.Inventories (I): - Remains of I on 01.01.2010 sumed to 150 000 tenge; - Remains of I on 31.12.2010 sumed to tenge 60 000; - During 2010, the sum of inventory purchased 4200000 tenge; - In April 2010, the return of the goods sold in December 2009 was made, in the sum of tenge 45 000. Cost of the returned goods at the time of sale was 35000 tenge. 2. Income from sales of goods sumed to 5 300 000 tenge. 3. The company received dividends from a company-resident «Tulke» in the sum of 50 000 Tenge (Sum of 50 000 tenge was sent to the bank account of «Samsam»). 30

4. The company has 5 computers on its balance. Value balance of the subgroups «Computers» at 01.01.2010 sums to 500000 tenge, the book value of all five computers is 600000 tenge. In July 2010, four computers were sold. Income from the sale of it was 650000 tenge. 5. One of the debtor of company «Samsam» is the Russian company «Maria», which bought the product on December 1, 2010 in the sum of U.S. $ 5000 (at the rate of $ 1 = 123 tenge). Till the end of the year the Russian customer debt sum did not come. At the final date of the reporting period, the market rate was U.S. $ 1 = 125 tenge. 6. Other expenses sumed to 450000 tenge (wages, office rent, taxes paid within the calculated sum). Based on these data it is necessary to calculate: a) taxable income; b) the sum of corporate income tax. The solution: TAI Income from the sale 5 300 000. Dividends 50000 tenge. (Art. 85 s.17) Increase in value departed assets 150 000 tenge. (Art. 92) Foreign exchange gain (125-123) * 5 000 = 10 000 tenge. TAI total: 5 510 000 tenge. TAI correctoions (50 000 tenge) (Art. 99 s.1 si.1) TAI after correctoions 5 460 000 tenge. Deductions Base cost of sales 150 000+4 200 000-60 000-35 000 = 4 255 000 tenge. Other expenses 450 000 tenge. Total deductions 4 705 000 tenge. Taxable income 755 000 tenge. Income correction (45000 tenge.) Art. 132 Total TI after corrections 710 000 tenge. Rate of 20% CIT sum 142000 tenge

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Task № 8. The company «Emir» non-resident working via a permanent establishment was doing a business in Kazakhstan and had the following data for 2010: Income from the sale of 105 500 000 tenge. Free of charge services were received 300 000 tenge. Received dividends suming to 500 000 tenge. Via transactions in foreign currency the positive exchange difference in the sum of 1 800 000 tenge and a negative difference in the sum of 1 300 000 tenge were received. By cession contract the company bought the debtor «Shah». The contract signed in 15.01.2009 at the sum of 180 000 tenge, the actual debt of debtor is 220000 tenge, 20.03.2010 debtor partily satisfied a debt by 100 000 tenge. In November 2008, the Company received a return financial help suming to 500 000 tenge, in accordance with the contract the return was supposed to happen by April 15, 2009, but has not yet been paid. In October 2007, goods were purchased worth 1 200 000 without VAT, payment had to be made in December 2007, the goods have not yet been paid. The excess liquid funds in the sum of 1 000 000 tenge were placed on bank deposit at 8%, from September 1, 2009 for 6 months. Remains of inventories at beginning of period 50850000 tenge, in 31.12.2010 30550300 tenge; it was bought of inventory during the year in the sum of 10 850 000 tenge. Company provided free of charge repair services for company «Kosmos», the net cost of these services 100 000 tenge. In March 2010, the Company obtained a loan in bank BTA in the sum of 25 000 000tenge, at 16% for 2 years. And took a loan under guarantee of the payment in the sum of 30 000 000 tenge from February 1, 2010, at 18% per annum. The company was not able to fully meet its obligations under the loan and the guarantor fulfilled its obligations to the bank. The average value of annual capital is equal to 6 500 000 tenge, annual average commitments - 40 000 000 tenge. Charity support to the veterans home was made according to letter of Akimat in the sum of 1 650 000 tenge. 32

One employee was on a business trip to Atyrau for 11 days, costs sumed to 301500 tenge (travel - 80 000 tenge, accommodation 137500 tenge, meals - 84000 tenge), at a rate equal to 6 -time MCI per day. In order to sign a contract the foreign partners from China tin the sum of 5 persons and 6 people from the local company were invited and the following expencies were made: - An official reception at the restaurant on the sum of 165000 tenge - Translation services of translator who is not an employee - 50 000 tenge per 8 hours - Souvenirs for foreign partners - 25 000 tenge. Labor cost of the company made in 2010 is 10 800 000 tenge. Annual obligation for payment of the employee's income is 9 750 000 tenge Property tax accrued 520000 tenge, paid 650000 tenge, vehicle tax accrued in the sum of 700 000 tenge, paid 600 000 tenge. VAT paid to the budget is 500 000 tenge. Fines paid to the budget sumed to 150 000 tenge. To celebrate the New Year 2011 goods worth 150000 tenge were used, which were bought in 2009. Determine taxable income for 2010. CIT to be paid for 2010. The solution: TAI: Income from the sale of 105 500 000 Art. 86 Income for doubtful liabilities 1200000 Art. 84 Income from concessions requirements 40 000 Art. 91 Free of charge received services 300 000 Art. 96 Dividends 500 000 Art. 85 s. 17 The excess of foreign exchange 500 000 Art. 85 s. 19 Interest on deposits 13 333 Art. 85 s. 18 TAI TOTAL 108053333 Correction: Dividends 500 000 Art. 99 TAI after correction 107 553 333 Deductions Cost of sales 33

50 850 000 + 10 850 000- 30 550 300 = 31 149 700 - 150 000 = 30 999 700 Art. 100, Art. 115 Interest expense: BTA - (25 000 000 * 16%) / 12 * 10 = 3333333 Bail - (6 500 000/40 000 000) * 6)*(30 000 000*18%)/12*11) = (0,1625*6) *4 950 000 = 0,975 * 4 950 000 = 4 826 250 Total Interest expense 8159583 Art. 103 Travel expenses (daily) 301 500 Art. 101 Representatives’ expenses (9750000 * 1%) 97 500 Art. 102 Salaries 10800000 Art 110 Taxes (520000 + 600000) 1120000 Art. 114 Total deductions 51478283 Taxable income 56075050 Art 139 The taxable income 56075050 * 3% = 1682252 Art. 133 Donation help 100000 Charity support 1650000 Total correction of TI 1682252 Taxable income after correction 54392798 (56075050 - 1682252) CIT calculation: Rate of 20% of Art. 147 s. 1 Sum of CIT 10878560 IT of payment source (1000 000 * 8%) / 12 * 6) * 15% = 6000 (offset CIT) Art. 139 s. 2 CIT sum considering offsett 10872560 (10878560 - 6000) Tax on net income (54392798 - 10872560) = 43520238 * 15% = 6528036 Art. 147 s. 5 Task № 9. The car repair shop «Boroda» registered with the tax office in early 2005. In February 1, 2010 in Kazakhstan's Bank a loan in the sum of 1 200 thous. tenge was received. Maturity of loan is December 31, 2010. Loan bank monthly interest rate of 30% over an year. The sum of credit and liabilities of credit were fully paid in Decem34

ber 31, 2010. Borrowed funds were used to purchase a car, computer equipment, the name and price of which are presented below: - Vehicle for 750 thous.tenge, date of purchase - March 12, 2010 - Computer equipment for 450 thous.tenge, date of purchase April 5, 2010 Fixed assets were bought for business purposes, and not for resale. For economic activities from March 1, 2010, the company rented an office room. Rental payments over the entire period was 200 thous. tenge. During the current year, on the accounts were the following production costs: - Salaries - 850 thous. tenge - The costs of social tax - Expenses for payment of utilities - 46 thous. tenge - Amortizatiuon of fixed assets for accounting purposes – 73,7 thous. tenge. The income of «BorodA» company for 2010 was 7 mln. tenge Information: The income tax rate - 20% Amortization rates: Group 2 subgroup of «Cars» - 25% Group 3 subgroup of the «Computers» - 40% Social tax - 11% The mandatory pension contributions - 10% of the salary Calculate the sum of CIT in 2010. The solution: TAI: Income from the sale of 7000000 tenge. Deductions: (1877650 tenge) Salaries 850 000 tenge Social tax 84 150 tenge Rents 200 000 tenge Interest on loans 330 000 tenge (1200 000 * 30%) / 12 * 11 35

Utilities Amortization Taxable income (TI) CIT rate of CIT sum

46000 tenge. 367 500 tenge 5122350 tenge 20% 1024470 tenge.

Calculation of Amortization: Content Book value at the beginning Incoming payment Disposals Book value at the end Amortization rate Amortization sum

Computer 0 450 000 0 450 000 40% 180 000

Calculation of social tax: 850 000 - 85 000 = 765 000 765 000 * 11% = 84150

Vehicle 0 750 000 0 750 000 25% 187 500

Total 0 1 200 000 0 1 200 000 367 500

Section II. Property taxes Theme № 4. Land tax Payers  individual and legal persons having the objects of taxation on property rights, the right of permanent land use and on the right of the primary free of charge temporary land use, except the single land tax payers, religious groups and others. The object of land tax. The tax base  Taxable object - a land plot, except to ones of public usage of districts, land plots occupied by the network of state public roads, and land plots occupied by objects that are temporarily closed by the decision of the Government of the Republic of Kazakhstan, the land acquired and used for the investment project.  The tax base - the area of the land plot. Land classification by category 1. Agricultural land; 2. Settlement land; 3. Land of Industry, transportation, communication, defense; 4. Land of specialy protected areas, land recreation, historical and cultural significance; 5. Forest lands; 6. land of water resources; 7. Reserve lands. Land tax is calculated from the first three categories of land, but if the forest lands used for agricultural purposes, then the tax is calculated on the base rates of agricultural land, if the land of water fund is used for industrial purposes, then the tax is calculated on the base rates of industrial land, if the land of industry is used for agricultural purposes, then the tax is calculated on the base rates of agricultural land. Land tax rates  for tax purposes, depending on the purpose all lands divided by categories. In this case, the land tax has to be applied to only 37

agricultural land, land settlements and industrial land. Other categories of land taxable only in the case of transfer to a permanent or primary free of charge temporary use of land.  On the basis of this distribution one sets out the basic rate of land tax. For instance, the basic rate of land tax on agricultural land has to be set up in proportion to scores of bonitet per 1 hectare and are differentiated by the quality of soil from 0,48 tenge to 202,65 tenge.  Basic tax rates for agricultural land given to individuals to maintain personal home (part-time) farming, gardening and dacha construction, including land occupied by buildings, are set in the following sums:  in the area up to 0,50 hectares inclusive - 20 tenge per 0,01 hectare;  on the area of more than 0,50 hectare, - 100 tenge per 0,01 hectare. Plots of land belonging to the land settlements, industry, protected areas of forest and water reserves used for agricultural purposes are taxed at the basic rates set in Art. 378 of the Tax Code taking into account conditions of s. 1 of Art. 387 of the Tax Code. Basic tax rates for land settlements (excluding land adjoining to house) are set as ones per one square meter, depending on the location and the name of the village, for instance, Astana rate is 19,3 tenge, and in Shymkent – 9,17 tenge, settlements – 0,96 tenge, villages – 0,48 tenge. Land adjoining to house is considered as a part of the land belonging to the settlement land, intended for maintenance of the building and is not occupied by residential buildings’ fund, including buildings and constructions with it. Land adjoining to house are taxed at the following basic tax rates: 1) for the cities of Astana and Almaty, and cities of regional importance:  in the area up to 1000 sq.m.inclusive – 0,20 per 1 square meter; 38

 with area exceeding 1000 sq.m.- 6,00 tenge per 1 square meter.  by decision of local state representatives of the tax rate on land plots exceeded 1000 sq.m.can be reduced from 6,00 to 0,20 tenge per 1 square meter; 2) for the remaining settlements:  in the area up to 5000 sq.m.inclusive – 0,20 per 1 square meter;  with area exceeding 5000 sq.m.- 1,00 tenge per 1 square meter.  by decision of local state representatives of the tax rates for land plots exceeded 5000 square meters, can be reduced from 1,00 tenge to 0,20 tenge per 1 square meter.  Basic tax rates for industrial land, located outside settlements № Subitem 1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17.

Category of bonitet 2 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Standard tax rate (tenge) 3 48,25 91,67 135,10 178,52 221,95 265,37 308,80 352,22 395,65 439,07 482,50 530,75 592,41 654,08 715,68 777,35 839,01

№ Subitem 4 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68.

39

Category of bonitet 5 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67

Standard tax rate (tenge) 6 2634,45 2690,23 2745,95 2801,72 2857,46 2913,24 2968,96 3024,73 3080,47 3136,25 3188,36 3247,75 3325,49 3364,61 3423,05 3489,25 3539,95

1 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51.

2 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50

3 900,67 962,29 1023,96 1084,66 1138,70 1189,07 1239,35 1287,73 1340,29 1390,66 1441,07 1491,45 1541,88 1592,25 1646,29 1693,03 1740,76 1788,47 1836,20 1883,87 1931,58 1979,31 2027,02 2074,75 2126,86 2178,19 2228,61 2278,98 2329,41 2379,79 2340,22 2480,57 2531,00 2582,34

4 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100. 101. 102.

40

5 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 over 100

6 3598,39 3656,81 3715,25 3769,29 3829,64 3890,53 3951,67 4012,79 4073,88 4135,02 4196,15 4257,23 4319,34 4371,45 4432,57 4493,66 4554,80 4615,92 4677,01 4738,15 4799,27 4860,36 4921,50 4975,54 5054,48 5134,32 5214,22 5294,09 5373,99 5453,83 5533,73 5613,59 5693,50 5790,00

Basic tax rates for land settlements (excluding houses adjoining land) № Subitem

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27.

Type of settlement

The basic tax rate on settlement land, except for the land occupied by residential buildings, including buildings and structures with him (tenge)

Cities: Almaty 28,95 Astana 19,30 Aktau 9,65 Aktobe 6,75 Atyrau 8,20 Karaganda 9,65 Kyzylorda 8,68 Kokshetau 5,79 Kostanay 6,27 Pavlodar 9,65 Petropavlovsk 5,79 Taldykorgan 9,17 Taraz 9,17 Oral 5,79 Ust-Kamenogorsk 9,65 Shymkent 9,17 Almaty region: Cities of regional level 6,75 Cities of district level 5,79 Akmola region.: Cities of regional level 5,79 Cities of district level 5,02 Other cities of regional 85% of the rate established level for the regional center Other cities of district 75% of the rate established level for the regional center Settlements 0,96 Villages 0,48

41

Basic rate of tax on land occupied by residential buildings, including buildings and structures with him (tenge) 0,96 0,96 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,58 0,39 0,39 0,39 0,39 0,39 0,19 0,13 0,09

Tax rates on property occupied by:  parking lots, gas stations - land settlements are taxed at the basic rate on settlement land increased by 10 times  casino - settlement land occupied by casinos are subject to tax at the basic rate of land settlements increased by 10 times. Taxable period  Calendar year The calculation and payment of land tax  Calculation of tax is made by taxpayers (except for legal persons making calculations with the budget in a special tax regime for legal entities, producing an agricultural products) by applying the appropriate tax rate to the tax base separately for each land plot.  Legal entities are required to calculate and pay the tax during the current period, payments for land tax. Sums of current payments are payable in equal parts in time no later than 25 February, 25 May, 25 August, 25 November. The final calculation and payment of land tax should be submitted no later than ten days after the deadline for submission of the declaration for the tax period. Deadline for tax reporting  Declaration (form № 700) for the land tax is (except for legal persons making calculations with the budget in a special tax regime for producers of an agricultural products) to the tax authority at the location of the objects of taxation no later than March 31 of the year following the reporting year.  The calculation of current payments for land tax should be submitted no later than February 15 of the current tax period. The newly created taxpayers, except for taxpayers, created after the deadline for the payment of current payments, give the calculation of current payments no later than 15th day of the month following the month of the state registration of the taxpayer.  After change of the tax liabilities for land tax during the tax period, the calculation of current payments submitted no later than 15 February, 15 May, 15 August and 15 November of the current 42

tax period over the objects of taxation at the current state on February 1, May 1, August 1 and November 1, respectively Taxation of individuals  calculation of land tax payable by individuals is done by the tax authorities on the basis of the relevant tax rates and tax base no later than August 1. Individuals pay land tax to the budget no later than October 1 of this year. Checklist 1. Who are the payers of land tax? 2. Name the category of lands that are taxed by the land tax? 3. What is the tax base? 4. In which case, the tax rate increases by 10 times? 5. When should be submited the calculation of current payments? 6. Terms of payment of the tax by legal persons? 7. In which case the correction factor of 0,1 is applied? 8. From what the rate of tax on land settlements does depend? 9. What is the deadline for payment of the land tax by individuals? 10. What is the deadline for submission of declarations to the tax authority? Task № 1. LLP «Lucca» bought land 500sq.m. in Almaty on February 5, year of 2010, 1000 sq.m. in Taldykorgan in March 15, 2010. These plots were registered in the authorized bodies of Almaty in February 6, 2010, and in Taldykorgan in April 25, 2010 respectively. Determine the sum of land tax, which LLP «Lucca» has to pay, specify the sum and terms of payment for land plots. The solution: Almaty: art. 381, 389. 500 * 28,95 = 14 475/12 * 10 = 12 063: 3 = 4021 until May 25, Taldykorgan: Art. 381, 389 1000 * 9, 17 = 9170/12 * 9 = 6878 3 = 2293 until May 25,

43

Task № 2. Tleusheva Bayan. bought dacha plot of 0,58 hec. in September 2, 2006. Calculate the sum of tax for the year 2010. The solution: Art.379 (0,5/0,01) * 20 = 1 000 (0,08/0,01) * 100 = 800 TOTAL 1 800 tenge According to Art. 391 tax calculation till August 1, and the payment until 1 October 2010. Task № 3. The company has an office building of 200 sq.m. The building is located on the land plot owned by the company as well with an area of 1000 sq. m. In addition to office buildings on the land there is a parking lot with an area of 100 sq. m.. Other structures on the landare not located. Additional Information: Factor of the tax rate increasing to be paid to the budget of the local maslikhat is 50% The land tax rate: 28,95 tenge Calculate the sum of tax payable to the budget in one year. The solution: Art.381, 386, 387 (28,95 *50%)+28,95)=(43,425 *900)+(100*(10*28,95)= 39 083 + 28 950 = 68 033 tenge. Task № 1. Enterprise of communication has 1300 hectares. Value of bonitet is 61. Local representative bodies raised the tax rate by 15%. Solution: According to Art. 383, s. 1 of the Tax Code of Kazakhstan the tax rate is 3188,36. Tax rate = 3188,36 x 115% = 3666 tenge 61 tiyn The tax sum = 1300 hec. x 3666,61 = 4766593 tenge 44

Terms of payment: 25.02. - 1191648 tenge 25.05. - 1191648 tenge 25.08. - 1191648 tenge 25.11. - 1191648 tenge Task № 2. Citizen from Kokshetau has a land plot of 165 sq. m. meters. According to Art. 381 of the Tax Code of RK tax rate is 0,58. The tax sum = 165 sq.m. x 0,58 = 95 tenge 70 tiyn. The deadline for payment is until October 1. Task № 3. Participant of the war in Afghanistan has the land plot of 12 sq. m.. Decision. According to Art. 373, s. 4, the citizen is not obliged to pay the land tax. Task № 4. Transport company has a land plot of 360 hectares. Value of bonitet is 16. In July, in addition it was given 120 hec. of similar land. Decision. According to Art. 383 s. of the Tax Code of RK the tax rate is 839,01. The tax sum = 360 x 839,01 =302044tenge Terms of payment: 25.02. - 75 511 tenge 25.05. - 75 511 tenge 25.08. - 75 511 tenge 25.11. - 75 511 tenge Recalculation = 120 х 839,01 = 100681 : 12 х 6 = 50341 tenge Terms of payment: 25.08 - 75 511 + 25 170 = 100 681 tenge 25.11. - 100 681 tenge

Theme № 5. Property tax Types of property tax  legal entities and individual entrepreneurs  individuals Payers  legal persons having taxable object on the ownership, economic administration or operational management on the territory of the Republic of Kazakhstan,  individual entrepreneurs having the object of taxation on the ownership on the territory of the Republic of Kazakhstan.  legal entities-nonresidents of the Republic of Kazakhstan on the objects of taxation on the territory of the Republic of Kazakhstan.  The concessionaire having the right of ownership, usage an object of taxation. Legal persons and individual entrepreneurs, concessionaires pay only for the property located on the territory of the Republic of Kazakhstan. are not property tax payers:  payers of single land tax on the objects of taxation, available on the right of property, directly used in the production, storage and reprocessing of the agricultural products. Payers of the single land tax on the objects of taxation, not used directly in the process of the production, storage and reprocessing of the agricultural products, pay property tax in accordance with this section;  government bodies;  state agenciesof prisons of the authorized state body in the are of the execution of criminal penalties;  religious associations. The object of taxation. The tax base  The object of taxation - are buildings, constructions, facileties, and other structures, permanently attached to land plot (hereinafter - the buildings), located in the territory of the Republic of Kazakhstan, being the main assets or investment in real estate. 46

 The tax base - the average net book value of the objects of taxation determined by the accounting data. The average annual value of objects of taxation is defined as one thirteenth of the sum received by the addition of the residual values of the objects of taxation on the first day of each month of the current tax period and the first day of period of the month following the reporting period. Rate calculation of the property tax Calculation of the tax is made by applying the appropriate tax rate to the tax base at the following rates:  1,5% to the average annual value of the objects of taxation the legal entities working on generally established regime apply  0,5% the individual entrepreneurs and legal entities working on the basis of a simplified declaration use; on the objects of taxation, transferred for usage or rent the tax is calculated by the rate of 1%.  0,1% the noncomercial organizations and organizations working in the social field, etc . apply  On the objects of taxation, bought during the tax period, the current payments on property tax are determined by applying the tax rate to the tax base at the moment of purchase of taxable items. 

Property tax rates for Individuals

1 1.

2 up to 1 000 000 tenge inclusive

2.

More than 1 000 000 tenge to 2 000 000

3.

More than 2 000 000 tenge up to 3 000 000 tenge inclusive

3 0,05 percent of the value of taxable items 500 tenge tenge inclusive + 0,08 percent of the sum exceeding 1 000 000 tenge 1300 tenge + 0,1 percent of the sum exceeding 2 000 000 tenge

4.

More than 3 000 000 tenge up to 4 000 000 tenge inclusive

2300 tenge + 0,15 percent of the sum exceeding 3 000 000 tenge

5.

More than 4 000 000 tenge up to 5 000 000 tenge inclusive

3800 tenge + 0,2 percent of the sum exceeding 4 000 000 tenge

6.

More than 5 000 000 tenge up to 6 000 000 tenge inclusive

5800 tenge + 0,25 percent of the sum exceeding 5 000 000 tenge

47

1 7.

2 More than 6 000 000 tenge up to 7 000 000 tenge inclusive

3 8300 tenge + 0,3 percent of the sum exceeding 6000000 tenge

8.

8. More than 7 000 000 tenge up to 8 000 000 tenge inclusive

11,300 tenge + 0,35 percent of the sum exceeding 7000000 tenge

9.

More than 8 000 000 tenge up to 9 000 000 tenge inclusive

14,800 tenge + 0,4 percent of the sum exceeding 8 000 000 tenge

10

over 9 000 000 tenge up to 10 000 000 tenge inclusive over 10 000 000 tenge up to 50 000 000 tenge inclusive over 50 000 000 tenge up to 120 000 000 tenge inclusive More than 120 000 000

18 800 tenge + 0,45 percent of the sum exceeding 9000000 tenge

11 12 13

23,300 tenge + 0,5 percent of the sum exceeding 10 000 000 tenge 223 300 tenge + 0,75 percent of the sum exceeding 50 000 000 tenge 748 300 tenge + 1 percent of the sum exceeding 120 000 000 tenge

Taxable period  Tax period - calendar year Terms of payment of property tax  Taxpayers have to pay tax payments on the tax on the property during the current tax period. Sums of current tax payments paid by the taxpayer in equal sums no later than 25 February, 25 May, 25 August and 25 November of the tax period.  For the newly created taxpayers and legal entities the first period of payment of current fees is next term following the date of creation of the taxpayer (the date of transfer of the objects of taxation for usage or rent).  On the objects of taxation, bought during the tax period, current payments of property tax are determined by applying the tax rate to the tax base at the moment of purchase of the objects of taxation. The sum of current payments is paid in equal parts in time, and at thgis time the first date of payment of the current fees is next term following the date of purchase of taxable items.  On the objects of taxation, decommissioning during the tax period, the current payments are reduced by the sum of tax defined 48

by applying the tax rate to the tax base of decommissioned objects at the moment of decommission. The sum of tax to be reduced is distributed in equal parts for the remaining period of tax payment.  The final calculation and payment of the property tax is made no later than ten days after the deadline for submission of the declaration for the tax period. Deadline calculation and tax declaration The calculation of current payments for the property tax:  submitted no later than February 15 of the reporting tax period.  The newly created taxpayers report the calculation of current payments sums no later than 15th day of the month following the month of submission at the tax authorities for registration.  On the objects of taxation, transferred for usage or rent, one submits the calculation of current payments’ sums no later than the 15th day of the month following the month of the transfer of objects in usage or rent.  after changes of the tax liability for the property tax during the tax period, the calculation of current payments are submitted no later than 15 February, 15 May, 15 August and 15 November of the current tax period for the objects of taxation as of February 1, May 1, August 1 and November 1 respectively.  Declaration (form № 700) is submited no later than March 31 of the year following the reporting year. Taxpayers individuals  Individuals having the object of taxation on property right with established certain categories of non-payers of property tax (including military persons of emergency service, seniors living alone, the heroes of the Soviet Union, of the Socialist Labor, and others). The object of taxation and tax base  The object of taxation on property - belonging to them by right of ownership and the living buildings, dacha constructions, garages and other buildings, structures, facilities, located in the territory of the Republic of Kazakhstan not used in entrepreneur 49

activity, and located on the territory of the Republic of Kazakhstan as well as constructions of unfinished constructions located on the territory of the Republic of Kazakhstan -from the moment of living (operation).  The tax base - the value of taxable items, set as on January 1 of each year by the authorized body established by the Government of the Republic of Kazakhstan. The procedure of calculation and payment of tax  Calculation of tax on taxable objects of individuals is performed by the tax authority at the location of the object of taxation independently from the place of residence of the taxpayer by applying the appropriate tax rate to the tax base no later than August 1 of the tax period.  The tax rates on personal property vary from 0,05 to 0,5 percent of the value of the object of taxation by the progressive scale. The tax is paid to the budget at the location of the objects of taxation no later than October 1 of the reporting tax period (calendar year). Checklist 1. Who are the payers of property tax? 2. What is the tax base for legal entities? 3. What is not an object of taxation on property tax of legal entities? 4. What is the deadline for submission of the calculation of current payments? 5. What is the deadline for payment of current payments? 6. What is the deadline for submission of tax declaration of the property? 7. How to calculate the sum of property tax if during the year the list of objects of taxation is changed? 8. Does the tax change if the taxpayer has sold or bought an apartment? 9. When a citizen has to pay tax on the property? 10. If the owner of the property is two individuals, how the tax is calculated?

Task № 1. What is the sum of property tax of the public fund «Healthy Kids», if the average annual remaining value of the property is 1 000,0 thous. tenge, and 20% of the property is rented? 50

The solution: Art.355 (1 000 000*20%) = (800 000 *0,1%) + ( 200 000 * 1,5%) = 3 800 tenge. Task № 2. Individual rented the living room, which has the residual value of 1 000,0 thous. tenge, the property tax will be: The solution: Art. 397, 398 1000 000 * 0,5% = 5,0 thous. tenge. Task № 3. The tax payer has two apartments. In one apartment taxpayer is living himself, and the other is rented by the legal entity, being the individual enterpreneur. The estimated value of the first apartment 3300000 tenge, and the average net book value of the second one9900000 tenge. The tax rate on the property of an individual in the range of 3000000 to 4 000 000 tenge - 2300 tenge + 0,15% of the sum over 3 000 000 tenge. Tax on property of the taxpayer in total is: The solution: Art.398 s.2, Art. 408 (9 900 000*0,5%)+(2300+(300 000*0,15%)=49 500+2 750 = 52 250 tenge. Task № 4. In the LLP «Diana» there were the following movements in the property, in the year of 2010: As of 01.01.10, the buildings - 30 500,0 thous. tenge As of 01.01.10, the facilities (warehouses, garage) - 5 500,0 thous. tenge greenhouse was bought 01.5.10 - 7 3250,0 thous. Tenge the store’s building was sold on 01.10.10 year - 5 356,0 thous tenge. 51

Calculate the sum of property tax in 2010,excluding the amortization. The solution: Art. 396 (30 500 000 + 5 500 000 + 7 325 000 - 5 356 000) * 1,5% = 569 535 Task № 5. Book value of the taxable objects is 12000000 tenge. Hence the annual sum of tax is 180 000 tenge, which has to be paid before 25.02. - 45000 tenge, till 25.05. - 45000 tenge, till 25.08. - 45000 tenge, till 25.11. - 45000 tenge. Task № 6. During the tax year on April 14 the taxpayer sold the property for 2 000 000 tenge . (in this case, he has right to reduce the sum of tax). Recalculation = 2,0: 12 x 8 months = 1333333 tenge The tax sum = 1333333 x 1,5% = 20000 tenge So, at the next period he will pay for 20000 tenge less, one reduces the current payments equaly over the terms of payment. The taxpayer paid (see example above): 25.02. - 45000 tenge, and will now pay 25.05. - 45000 - (20000: 3) = 45000 - 6667 = 38333; 25.08. - 38 333 tenge 25.11. - 38 333 tenge Task № 7. Citizen owns an apartment worth 2300000 tenge. Solution: According to Art408 of the Tax Code of RK the tax rate 1300 + 0,1% The sum of tax = 1300 + (2300000 – 2000000) х 0,1% = 1300 + 300 = 1600 tenge Task № 8. Citizen owns an apartment in Kokshetau value 1200000 tenge apartment in Astana worth 6800000 tenge and apartment in the city of Omsk worth 10000 euros. 52

Solution: Apartment Kokshetau The tax sum = 500 + 200 000 x 0,08% = 2100 tenge Apartment in Astana The sum of tax = 8300 + 800 000 x 0,3% = 8300 + 2400 = 10 700 tenge Apartment Omsk The sum of tax = tax by the Law of the RK is not applied to, the citizen must pay according to TC of Russia. Task № 9. Living alone pensioner has a house worth 11360000 tenge. The size of privilege (according to Art. 403, s. 2, Tax Code of RK) 1000 MCI, the value of MCI in 2009 - 1296 tenge. 1000 x 1296 = 1296000 tenge Tax base = Cost of the apartment - privilege = 11360000 1296000 = 10064000 tenge The tax sum = 23300 + 64000 x 0,05% = 23620 tenge. Task № 10. Citizen sold the apartment in May. Price of apartment 251165000 tenge. The tax sum = 748300 + 1311650 (131165000 х 1%) = 2059950 tenge Recalculation = 2059950: 12 x 5 = 858 313 tenge (the citizen has to pay)

Theme № 6. Vehicle tax Payers  Individuals having taxable items on the right of ownership  Legal entities and their branch offices having taxable items on the right of ownership, economic operationing or operational management.  Lessee – by the objects of taxation, given (received) under the contract of finance lease. Object of taxation  The vehicles except trailers are subject to state registration and (or) registered in the Republic of Kazakhstan. At the same the dumptruck with load capacity of 40 tons and above, as well as specialized medical vehicles. Rates of taxation  Calculation of tax is made at a rate for each vehicle, set in the monthly calculation index (MCI).For instance, for cars from 1 to 117 MCI, but for trucks and special vehicles - from 3 to 9 MCI.  Suring purchasing a vehicle which is in the time of purchase not registered in the Republic of Kazakhstan, the sum of tax is calculated for the period from the 1st day of the month in which the right to property has appeared, the right of economic operation or the right of operative control of the vehicle till the end of the tax period For cars № subitem 1. 2. 3.

Volume of car’s engine (cc)

Tax rate (MCI)

To 1100 inclusive Over 1100 to 1500 Over 1500 to 2000

1,0 2,0 3,0

4.

Over 2000 to 2500

5,0

54

Increasing the sum of the tax by 7 tenge (accord. to Art. 367, s. 2) The size of the engine, more than 1500 × 7 tenge The size of the engine, more

5.

Over 2500 to 3000

8,0

6.

Over 3000 to 4000

15,0

7.

Over 4000

117,0

than 2000 × 7 tenge The size of the engine, more than 2500 x 7 tenge The size of the engine, more than 3000 × 7 tenge

For trucks № subitems 1. 2. 3. 4.

Trucks, special cars carrying capacity (without trailers) 1 ton including Over 1 ton to 1,5 tons More than 1,5 tons to 5 tons Over 5 tons

Tax rate (MCI) 3,0 5,0 7,0 9,0

Buses № п.п 1. 2. 3.

Number of seats

Tax rate (MCI)

Till to 12 seats including Over 12 to 25 seats More than 25 seats

9,0 14,0 20,0

For motorcycles, scooters № п.п 1. 2.

Engine power

Tax rate (MCI)

Motorcycles, scooters, snowmobiles, boats less than 55 kW Motorcycles, motor power of more than 55 kW

1,0 10,0

Boats, ships, tugs, barges, yachts № s.i. 1. 2. 3. 2.

Engine power in horse power Till to 160 inclusive Over 160 up to 500 Over 500 up to 1000 Over 1000

Tax rate (MCI) 6,0 18,0 32,0 55,0

55

Taxable period  Tax period - calendar year Order of tax  The tax is paid to the budget at the place of registration of objects of taxation no later than July 5 of the tax period. Taxpayers - legal entities make final calculation of tax on vehicles no later than ten days after the deadline for submission of tax on vehicle for the tax period.  In case of purchase of property rights, the right of economic operation or operational control over the vehicle, after July 1 of the tax period the payment of taxes to the budget is made before or on the date of the state registration of the vehicle.  In case of purchase of property rights, the right of economic operation or operational control over the vehicle, at the time of purchase registered in the Republic of Kazakhstan, after July 1 of the tax period the individual entrepreneurs, private notaries, lawyers, legal entities have pay tax on the mentioned vehicle at the period no later than ten working days after the deadline for submission of the declaration for the tax period. Deadline for submission of tax declaration  payers- legal persons (with the exception of legal entities making payments to the budget in a special tax regime for the producers of agricultural products) submit to the tax authorities at the place of registration of the objects of taxation the calculation of current tax payments on vehicles no later than 5 July of the current tax period and the declaration (form № 700) at the period no later than March 31 of the year following the reporting year. Checklists. 1. Who are payers of the vehicles? 2. From what does depend the rate of tax on vehicles? 3. In which case the tax sum is increased by seven tenge? 4. Who is not paying the taxes? 5. What are terms of payment of tax on vehicles? 6. Deadline for submission of the declaration of the TV(taxable vehicle) to the tax committee? 56

Task № 1. LLP had a car (made in Japan) in the period from 01.01.2010 to 19.04.2010, and later on the car was sold. Engine capacity - 2300 c.c. Term of operation at the time of sale - 7 years. According to the Tax Code of RK:  tax rate on vehicles in the range of 2000 to 2500 c.c- 5 MCI;  The sum of tax increase for each unit exceeding this volume - 7 tenge;  MCI - 1413 tenge Solution (2011): Art. 367 , Art.. 368 (5 * 1512) + (300 * 7) = 7560 2 100 = 9660/12 * 3 = 2415 tenge Task №2. The Company has the following types of vehicles: - Car Niva 1993 1610 c.c 1 units - Nissan, 1996, 2293 c.c 1 units - KAMAZ, load capacity of 8 tons, 1994 1 units. - Purchased cars vans With load capacity in 1100, 25 May 2010, 4 units - Gazelle, with load capacity 3 tons purchased by May 7, 2010 1 units. - There is a service bus with 13-seats 1998, volume of 3200 c.c 1 units. - A car Toyota Land Cruiser 1989, engine capacity 4400 c.c 1 units. Determine the sum of vehicle tax for 2010. The solution: Art.367 NIVA: (3 * 1413) + (110 * 7) = 4239 + 770 = 5009 Nissan: (5 * 1413) + (293 * 7) = 7065 + 2051 = 9116 KAMAZ: 9 * 1413 = 12717 Car: 5 * 1413 = 7065 * 4 = 28 260/12 * 8 = 18 840. Gazelle: 7 * 1413 = 9891/12 * 8 = 6594 Bus: 14 * 1413 = 19782 TOYOTA: 117 * 1413 = 165321 Total for transport tax: 237 379 tenge. 57

Task № 3. In the LLP «Omega» there is a vehicle «Mitsubisi Delica» of the year of 2001 , with an engine capacity 2500 c.c. Vehicle purchased by «Omega» company on May 5, 2010. Required: Calculate the sum of tax on the vehicle in the year of 2010. The solution: 5 * 1413 + 500 * 7 = 7065 + 3500 = 10 565/12 * 8 = 7043 tenge. Task № 4. Temirbekova Bayan bought a car, «Toyota Carina E» for private usage in October 2005. Engine’s capacity is 2000 c.c., model was produced in the year of 1996. Required: Calculate the sum of the individual for the tax year 2010. The solution: 3 * 1413 + 500 * 7 = 4239 + 3500 = 7739 tenge Task № 5. In JSC «A» there are the following data on the company’s activity: In 2010 the TAI Total SA «A» was - 30 250,0 thous. tenge income from the services in the field of high education - 29 456,0 thous. tenge the average value of production buildings defined by accounting -125 020,0 thous. tenge NMA defined in the accounting - 120,0 thous. tenge Vehicles - 450,0 thous. tenge Construction in progress - 854,0 th. Calculate the sum of property tax for 2010. The solution: Art.396 125 020 000 * 1,5% = 1875300 tenge.

Section III. Taxes on consumption Theme №7. Value – added tax Value added tax (VAT) is payment of the part of the taxable sales income cost to the budget value, added in the process of production and circulation of goods (works, services), as well as payments during the import of goods into the territory of the Republic of Kazakhstan. VAT payable to the budget on the taxable income is defined as the difference between the sums of VAT calculated for the saled goods (works, services) and the ones payable for purchased goods (works, services), i.e. the difference between the purchased and sold VAT. Payers Individuals who registered or have to register for the value added tax in the Republic of Kazakhstan:  individual entrepreneurs  legal entities, except for government agencies,  nonresidents doing activities in the Republic of Kazakhstan via a permanent establishment  company’s branches of the legal entity, considered as independent payers of the value added tax  The VAT payers on imports of goods are entities importing these goods into the territory of the Republic of Kazakhstan in accordance with the customs legislation of the Republic of Kazakhstan. Taxable object of VAT  taxable turnover – is turnover of the goods’ sales (works, services) in the Republic of Kazakhstan, made by the VAT payer, except for the turnover released from the VAT. In the case of works and services received from non-resident not being the VAT payer in the Republic of Kazakhstan, the mentioned above works, the services are included in the taxable turnover of the recipient.  taxable import - goods imported or entered into the territory of the Republic of Kazakhstan (except released from VAT), 59

subjected to the declaration in accordance with the customs legislation of the Republic of Kazakhstan. To the mandatory setting to VAT are not subjected:  government agencies;  individual entrepreneurs and legal entities making the activities in the giving of services: 1) Casino; 2) halls of game slot machines; 3) tote; 4) the bookmaker’s office and payers of gambling tax are  individual entrepreneurs and legal entities making the activities of services with usage of: 1) slot machines without a win; 2) personal computers used for games; 3) The game roads (bowling (bowling alley); 4) karts (karting); 5) pool tables (billiards) and being the fixed tax payers  payers of the single land tax. VAT benefits If during the tax period, but no more than a calendar year, on results of which the size of the turnover of goods’ sales (works, services) does not exceed a minimum turnover, which is the 30 000 time monthly calculated index given on the last month of the period (MCI in 2011 is 1512 tenge* 30 000 = 45360000 tenge), then one has not to register for VAT. VAT rates  12% - on taxable turnover and taxable import  0% - turnover for the sale of goods for export (except for exports of non-ferrous and ferrous scrap) and works, and services related to international transportation  Turnover released from VAT - the turnover of goods’ sales (works, services), including, in particular, contributions to the shared capital, financial services, property rent, assignment of rights of asset to the financial leasing, geology exploration works, imports of certain products, including imports of goods by the individuals at the 60

rates of duty-free import of goods, the import of foreign currency, drugs and other goods, etc. Cases where the VAT is taken to offset Recipient of the goods (works, services) has the right to set-off of sums of VAT payable for the received goods, including fixed assets, works and services, if they are used or will be used for purposes of taxable turnover, and if the following conditions are taken into account:  recipient of the goods (works, services) is the payer of value added tax on the date of the invoice  supplier issued the invoice  In case of import of goods - the value added tax is paid to the budget  in cases where the tax obligation on the value added tax payment is done If a taxpayer has taxable non-taxable turnover the VAT sum is set off according to the voluntarily selected by taxpayer method 1) proportional; 2) separate; The chosen method is not changed during the calendar year. Proportional method. According to the proportional method, the sum of VAT set off is determined based on the percentage of taxable turnover in the total sum of turnover. In operations with bonds in the turnover of sales one includes the increase received in the sale of the bonds . The sum of VAT to the budget = in the sum of VAT in Income - VAT sum in raw materials Percentage = Taxable turnover/Total turnover, where Total turnover =Taxable turnover+ NonTaxable turnover The VAT sum to offset = VAT sum in raw materials X Percentage 61

The VAT sum to the budget = Total VAT Income - the sum of VAT to offset Separate method. In determining of the VAT sum applied as setoff according to the separate method, the VAT payer is making a separate accounting records of expencies and VAT sums of the obtaining goods used for the purposes of taxable and non-taxable turnover. Banks, institutions making certain types of banking operations and microcredit organizations using the proportional method for setting off are eligible for the applying of the separate method for accounting of VAT sums on turnover related to the obtaining and selling the pledged assets (goods) During the transfer of property to the financial lease the lessor using the proportional method for setoff has a right on applying of the separate method of the accounting of VAT sums on turnover related with the transfer of the property in the financial lease. Cases where the issue of invoices is not required: The VAT payer selling the goods (works, services), taxable by VAT, must issue the invoice with the VAT to the person receiving the goods (works, services), except the following cases:  making payments for utility services, telecommunication services to the population via the banks with the use of primary documents, which are the basis for keeping of the accounting book  processing of transfer of passengers with tickets  in selling goods (works, services) set off from value added tax. Procedure for the payment of value added tax  the VAT payer has to pay the tax to the budget for each tax period no later than the 25th day of the second month following the tax reporting period, the set deadline for the submission of the VAT declaration.  the VAT on imported goods has to be paid on the day determined by the customs legislation of the Republic of Kazakhstan for the payment of customs duties. 62

Deadline for submitting a VAT  The VAT declaration for each tax period is submited no later than the 15th day of the second month following the tax reporting period. Checklists 1. Who are the VAT payers? 2. What is the object of determining the VAT? 3. In which case, the taxpayer has to apply a letter for registration in the Tax authority? 4. In which case, the taxpayer can quit from the accounting for VAT? 5. What is the taxable turnover? 6. What is the taxable imports? 7. How is the sum of taxable turnover defined? 8. What are the VAT rates? 9. In which case the zero rate is applied? 10. What is the turnover and imports released from VAT? 11. What is the offset? 12. In which case, the correction of the VAT set off is made? 13. How is the sum set off by the proportional method determined? 14. In which case does the invoice not require? 15. When the tax period is a calendar quarter? 16. What is the reporting period for VAT?

Task № 1. The company «Avtoalliance» paid to an individual on 10.05.2010 year for the international transport services 100,0 thous. tenge. What is the VAT sum? The solution: Art. 242. The turnover on the sale of goods for export is taxed at a zero rate. Export of goods is the export of goods from the customs territory of the Customs Union, carried out in accordance with the customs legislation of the Customs Union and (or) to the customs legislation of Republic of Kazakhstan. VAT sum = 0 tenge Task № 2 JSC «Zhalym» received from non-resident the equipment for further transfer to the financial lease to the lessor; the customs value, 63

including duties and taxes, is 1 500,0 thous. tenge. Import VAT value will be: The solution: Art. 246, 247, 255 of the Tax Code. Import VAT = 1 500 000 * 12% = 180000 Task № 3. The company manufactures the materials and is a VAT payer. In the second quarter of the year of 2009, the company sold products in the territory of the Republic of Kazakhstan in the sum of 1100 thous. tenge and exported on sum of 600 thous. tenge. From buyers it received the sum of 112 thous. tenge, including VAT. Shipment will be made in accordance with the contract signed in August 2009. For its activity the company purchased goods worth 200 thous. tenge and imported materials in the sum of 800 thous. tenge. All the necessary documents are filled properly, import was paid for in the customs territory in June 2010. The company also imported equipment for its own usage costing 700 thous. tenge and the VAT was paid by offset method. Sums of sales and purchases are given without the VAT. Determine the sum of VAT to be paid to the budget for the 2nd quarter of the year 2010: The solution: Charge of the VAT: Art. 211, 218, 222, 223, 250 Sales 1 100 000 132 000 Exports 600 000 0 Imports by offsetting 700 000 84 000 TOTAL 2 400 000 216 000 VAT set off: Art. 235, 213, 220, 250 Purchase 200 000 24 000 Imports 800000 96000 Imports by offsetting 700 000 84 000 TOTAL 1 700 000 204 000 VAT payable to the budget Art.205 Task № 4. In 3d quarter of the year 2010, the Company «Betta» made the following operation: 64

a) Paid telecommunication services for the 4th quarter of 2010 to 240 thous. Tenge (without VAT) b) Purchased raw materials in the sum of 480 thous.tenge (without VAT) c) purchased gifts for children of staff to children's competition in sum of 30 thous. tenge (without VAT) What is the sum of tax on purchased resources has to be set off in the VAT declaration for the 3rd quarter of 2010, taking into account that the company makes only the taxable turnover? The solution: Art. 216, 235, 236 480 000 * 12% = 57600 Task № 5. LLP «Samal» working in wholesale and retail trade, in the 2nd quarter 2010 has made the following operations (excluding VAT): 1. sold goods worth 150,0 thous. tenge, Art. 231 2. sent via the currency account for the goods received in 1st quarter $20,0 thous. U.S. dollars at the rate of 134,5 tenge per $ 1, Art. 237 3. during the inventory of goods it was found the missing of goods in the sum of 120,0 thous. tenge, director of the company has decided to keep the sum of missing from the guilty person, Art. 258, s. 1. 4. as an advertisement one presents to individuals goods worth 50,0 thous. tenge (unit cost was 5,0 thous. tenge), Art. 238, Art. 231 s. 3 5. purchased cars ment for sale in the amount of 5 units 750,0 thous. tenge each; during arrival, it was found that one of the vehicle has a manufacturing defect, and to the supplier the claim was given in the sum of 250,0 thous. tenge, however a supplier refuses to pay for the claim referring to possibility of the origin of this defect during loading and unloading operations; one of the vehicles was presented to a sales manager as a reward for good work, Art. 231, 238 s.8, 256 65

6. made a repair of leased office on sum of 150,0 thous. tenge, the landlord agreed to split the costs in half with the tenant using the rent for May, Art. 256, 258 7. obtained imports on sum of 500,0 thous. tenge on which VAT paid in the sum of 65,0 thous. Tenge, Art256 8. paid to non-residents for services of international transport in the sum of 50,0 thous. tenge. Art241 Determine the sum of VAT payable to the budget. Show the calculation of VAT. The solution: VAT declaration. Calculated VAT: Turnover, taxable by the Sum of turnover VAT sum VAT Sale of auto 150 000 18 000 Promotional products 50000 6000 The car given as the premium 750 00090 000 Total calculated VAT 950 000 114 000 VAT set off: Purchase of vehicles 3 750 000 450 000 (5 * 750 000) Building repairs 150 000 18 000 Obtained import 500000 60000 Services to non-resident on the 50 000 0 international transportation TOTAL offset 4 450 000 528 000 Correction of VAT set off: Shortage of goods 120 000 14 400 Compensation of repair 75000 9000 Total corrections (195000) (23400) Total VAT set off (528 000 - 23 400) 504 600 Totally the VAT payable to the budget: The excess of the VAT set off 114 000 - 504 600 390 600 over the calculated VAT According to Art. 272, Art. 253 of the RK -100 - IV from 10.12.2008 is set off as the future payments or the return is done. 66

Task № 6. Company «Route» for the first quarter of 2010 got the following operations(in thous. tenge) without VAT: - made international transportation of $ 12 500,0 ; Art. 242 - made services by contracts of delegation on the sum of 2 500,0 (interest of the company was 10% of the made services), Art. 238 s. 15 - Services for the loading and unloading of goods for export 6 250,0 Art. 248 s.i. 10 - Interest on deposits 125,0 Art. 250 - transportation and expedition services on the territory of the Republic of Kazakhstan 8 000,0 Art. 238 s.12 - Have received bills for utilities in the amount of 1 250,0; Art256 - Payments to individuals according to a one-time receipt contract 250,0; Art231 (is not a turnover) - Paid for the 4th quarter of 2009 for office rent and 1 250,0 1 500,0 for 1st quarter of 2010 (this cost includes the rent of the land plot for parking of the service vehicles in the sum of 150,0 for the 4th quarter of 2009 and 175,0 for 1st quarter of 2010); Art.237, Art.238, Art.231 - Paid taxes in sum of 250,0; Art231 (is not a turnover) - Remuneration paid to non-residents on credits 1 750,0, Art. 250 - purchased the fuel 3 600,0 Art. 256 - made the import of spare parts (customs value is 2 500,0). Art. 256 Required: Calculate VAT for the first quarter of 2010, taking into account that all suppliers are payers of the VAT. The solution: Calculated VAT: calculation turnover VAT Turnover taxed at the rate of 12% Contract of delegation services 250 000 30 000 Transportation-expedition services 8 000 000 960 000 Total taxable turnover 8 250 000 990 000 Turnover taxed at a rate of 0% International transport 12 500 000 0 Total turnover on the rate of 0% 12500000 0 67

Turnovers released from VAT The loading and unloadings of 6250000 goods services for export Total non-taxable turnover 6250000 Total turnover 27 000 000 990 000 Share of taxable turnover in the total turnover (20750000/27000000) * 100% = 76,85% VAT set off, Utilities 1 250 000 150 000 Rent 1 500 000 180 000 Buying fuel 3 600 000 432 000 Import of spare parts 2 500 000 300 000 Total VAT set off 8850000 1062000 Allowed VAT related to the budget 1062000 * 816 147 76,85% VAT payable to the budget (990 000 173 853 816 147) Related to the expencies 1062000 - 816 147 = 245 853, Art. 100, 260 Task № 7. The following facts for the tax period – quarter 1 - for the company, «Cartel», a resident of the Republic of Kazakhstan, registered as the VAT payer(the corresponding values are presented excluding of the VAT) are known: - Payments for the utilities are 75000 tenge; Art256 - 2millions 500 thousands. tenge were paid to suppliers for materials used in main activitiy; Art237 - The expencies for the salaries of employees are 750000 tenge; acc. To Art231, is not turnover - 25mln. tenge were received for goods shipped to customers in December, Art. 237 date is in December - Goods worth 17 millions tenge were shipped to customers in Kazakhstan, but for them it was received in May, only 12 millions tenge , Art.. 237, charge made in 1st quarter, Art.238 - For export there were shipped products (documented) for 2 millions tenge, Art. 242, 243, the rate is 0% 68

- As an advertising action it was given to the employees 750 pens costing 230 tenge per unit. Art. 231 s. 3 - For the company's clients there were made services related to the international transportation , on the sum of 12 millions tenge. Art. 244, the rate is 0% - sold the land plot with the house valued - 9200000 tenge, Art. 249 released turnover All providers of services are the payers of the VAT. Required: Find according to the proportional method: 1. VAT set off; 2. VAT associated to the expencies; 3. VAT payable to the budget. The solution: Calculated VAT: Total sum of the turnover VAT The taxable turnover: Sales of goods 17 000 000 2 040 000 Total taxable turnover 17 000 000 2 040 000 Turnover taxed at a rate of 0%: Exports of goods 2 000 000 0 International transportation 12 000 000 0 Total turnover rate of 0% 14 000 000 0 Turnovers released from VAT: The sale of the land plot 9 200 000 Total released turnover 9200000 Totally calculated 40200000 2040000 Share of taxable turnover in the total turnover (31000 / 40200000) * 100% = 77,1% VAT set off: Utilities Totally set off Allowed offset on the VAT Art. 261 69

75 000 9000 75000 9000 9000 * 77,1% = 6939

VAT payable to the budget 2040000 - 6939 = 2033061 Art.266 VAT associated to the expencies, 9000 - 6939 = 2061 Art. 260 s. 3 Art. 100 s.12 while calculating of CIT, corresponds to thedeductions Task № 8. Define: the turnover of goods’ sale (works, services), taxable by the VAT. Calculate the sum of the tax on the added value. Sums are shown excluding of the VAT. 1) The goods sold in Kazakhstan 4130000 tenge. The solution: Implementation in Kazakhstan at the rate of 12%. 4130000 x 12% = 495 600. 2) goods delivered for export to Kyrgyzstan - 1900000 tenge The solution: Export at a rate of 0%. 1900000 x 0% = 0. 3) a passenger car was sold at the price of 800000 tenge, the residual value of which 90000 tenge. The solution: Items for which no offset on VAT is provided, sales turnover the positive difference between the cost of sale and the book value s.i. 2, s. 1, Art. 257. There are on positive difference, therefore, thre are no taxable turnover. 4) The business center building was sold at a price of 4 000 000 tenge being on the balance since 1999. The residual book value of the business center is 3000 000 tenge. The solution: «The law on taxes and other obligatory payments to the budget» did not provide the offset of the VAT for the buildings. Sales turnover - the positive difference between the cost and the book value of s.i. 2, s. 1, Art. 257 and s.1 Art. 238. Positive difference is 1 000 000 x 12% = 120 000 tenge. 70

5) The equipment with the residual value of 295 000 tenge was donated to the Social Organization. The solution: According to the s.2 Art238, taxable turnover is determined based on the price level of the sale turnover, without inclusion of the VAT, but not lower than the book value. 295 000 x 12% = 35 400 tenge 6) the penalties were received from the supplier for the violation of the contract conditions in the sum of 230 000 tenge. The solution: Penalties are not the turnover of sale, Art231, and are not a part of the released turnover - s.33 of the TC. 7) A land plot considered for the construction of the business center was sold in the sum of 3 000 000 tenge. The solution: The land plot is not occupied by any buildings not used for the parking and storage of vehicles. s. 2 of Art. 249. The transfer of the ownership, usage and comand of the land plot are released from the VAT. 8) the previously sold good was returned on the sum of 400 thous. tenge. The solution: Acc. to Art. 239. when the value of goods and services change in either direction, appropriately the the size of the sum of taxable turnover in case of from full or partial return is corrected Correction of the VAT is 400 000 x 12% = 48 000 tenge 9) As a result of the trade the cost of the given good was increased by the total sum of 120 000 tenge The solution: Acc. to Art. 239. when the value of goods and services changes in either direction, appropriately the size of taxable turnover in cases of change of the deal is corrected. Correction of the VAT is 120 000 x 12% = 14 400 tenge 10) According to the terms of the contract for payment of the sold good the conversion factor of debt was used, resulting in addition the sum of 100 000 tenge. The solution: 71

Acc. to the Art. 239. When the value of goods and services change in either direction, appropriately the sum of taxable turnover in cases of price changes, compensation for the sold goods, works and services is corrected. Correction of the VAT 100 000 x 12% = 12 000tenge 11) the debt of the buyer of the sold in 2007 good worth 60 000 tenge is considered as doubtful. In 2007 – the VAT is 14%. The solution: Acc. to Art. 239. when the value of goods and services change in either direction, appropriately the sum of taxable turnover from full or partial return is corrected VAT correction is 60 000 x 14% = 8400 tenge 12) Delivered goods for export to Kyrgyzstan 1500000 Cost of goods sold The sum of VAT related to sales, referred to offset Goods sold in Kazakhstan Delivered goods for export to Kyrgyzstan 1500 Car was sold

1500000

Residual book value of which It was sold the industrial building, being on the balance of 2000 years, the residual book value of which

700000

For For the Social organization

4000000 215000

taxed at a rate of 0%

1200000 144000 2130000 1500000

sale in Kazakhstan at 12% taxed at a rate of 0%

800000

The offset is not considered on the purchase. Sales turnover - the positive difference between the cost of the sale and balance value, s.i.2, s.1, Art 257. There is not the positive difference. Is is not included in the VAT return.

2333000

72

s.i. 2, p 1, Art. 257 and s.1 Art.238: the positive difference between the cost of the sale and balance value = 4000000-2333000 =1667000 turnover s.2 Art. 238-Turnover

it was donated the equipment the residual value of which is The penalties were received from the supplier for the violation of the contract conditions

230000

215000-according to the level of prices on the date, without the VAT, but not lower than the book value. from fines are not turnover of sale Art.231 but not unreleased turnover

Theme № 8. Excises tax Payers  Payers of the excise tax are persoanl or legal entities that manufacture excisable goods or perform excisable types of activities in the territory of the Republic of Kazakhstan, import excise goods into the customs territory of the Republic of Kazakhstan. Excisable goods – all types of spirit, alcoholic beverages, beer with volume content of the ethyl alcohol not exceeding 0,5 percent, tobacco, petrol (except for aviation), diesel fuel, vehicles (except vehicles with manual control, specially designed for the disabled people), crude oil, gas condensate. Object of taxation  Operations made by excise payer with produced and (or) extracted and (or) bottled by him the excisable goods: Sales and transfers for recycling on a give-and-take basis of excisable goods, the contribution to the share capital, the use of excisable goods via natural payment, shipment of the excisable goods made by the goods producer via its structural units, the use of goods producers of the produced and (or) extracted, and (or) bottled excisable goods for their own production needs, wholesale of gasoline (except the aviation one) and diesel fuel, the sale of confiscated and (or) ownerless, moved by the heirship to the state and free fo charge given to the state ownership of excisable goods; damage, loss of excisable goods, excise stamps. Tax base of the excise rate  Excise rates are set in a percentage (ad valorem) to the value of goods and (or) in the absolute sum per unit (solid) of measure in the natural terms.  Excise taxes on alcohol products are approved in accordance with s. 1 of this article or, depending on the volume content in it of the waterless (one hundred percent) spirit.  For all types of spirit and wine material the excise rates are differentiated depending on the purpose of further use of alcohol and wine material.  On the spirit and wine material, sold for alcohol production, the rate of excise may be set below the base rate set for the spirit and wine material sold to the persons not using them for the production of alcoholic beverages. 74

Excise rates Code FEACN EurAsEC

From 2207

75

 

Type of excisable good

Rates from 1.01.09 till 1.01.10

RK Undenatured 450 ethyl alcohol tenge / with a liter concentration of 80 volume percents or more; ethyl alcohol and other types of alcohol, denatured, of any concentration (except alcohol, sold for the production of alcoholic beverages, medical and pharmaceutical products, as well as of delivered to

import 600 tenge / liter

Rates from с 1.01.10 till 1.01.11 RK 500 tenge / liter

import 600 tenge / liter

75

Rates from с 1.01.11 till 1.01.12 RK 550 tenge / liter

import 600 tenge / liter

Rates from с 1.01.12 till 1.01.13 RK 550 tenge / liter

import 600 tenge / liter

Rates from с 1.01.13 till 1.01.14 RK 550 tenge / liter

Rates from с 1.01.1 4

import 600 600 tenge / tenge / liter liter

From 2207

76

From 2208

the state health facilities within the set quotas) ethyl alcohol 0,1 (ethanol) tenge / denatured ,fuel liter (not colored, painted for consumption in the domestic market) Undenatured 550 ethyl alcohol tenge/ with an alcoholic liter content lower than 80 volume percents, spirits and other alcoholic beverages (except alcohol, which is sold for the production of alcoholic beverages, medical and pharmaceutical products, as well as of delivered

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 tenge / liter

0,1 0,1 tenge / tenge / liter liter

750 tenge/ liter

600 tenge/ liter

750 tenge/ liter

650 tenge/ liter

750 tenge/ liter

650 tenge/ liter

750 tenge/ liter

650 tenge/ liter

750 tenge/ liter

76

750 tenge/ liter of the 100% spirit

From 2207

77 From 2208

ones to the state health facilities within the set quotas) The undenatured 45 ethyl spirit with tenge/ the alcohol liter concentration of 80 volume percent by or more, ethyl spirit and other types of spirit, denatured, of any concentration, sold for the production of alcoholic beverages ethyl 55 tenge/ undenaturated spirit with spirit liter of concentration the lower than 80 100% volume percents spirit , spirits extracts and other alcoholic beverages sold

60 tenge/ liter

45 tenge/ liter

60 tenge/ liter

55 tenge/ liter

60 tenge/ liter

55 tenge/ liter

60 tenge/ liter

55 tenge/ liter

60 tenge/ liter

75 tenge/ liter of the 100% spirit

60 tenge/ liter of the 100% spirit

75 tenge/ liter of the 100% spirit

65 tenge/ liter of the 100% spirit

75 tenge/ liter of the 100% spirit

65 tenge/ liter of the 100% spirit

75 tenge/ liter of the 100% spirit

65 tenge/ liter of the 100% spirit

75 75 tenge/ tenge/ liter of liter of the the 100% 100% spirit spirit

77

60 tenge/ liter

From 2208

From 2208

78 From 2208

From 2204, 2205, 2206 00 From 2204,

for the production of alcoholic beverages 250 Alcoholic tenge/ beverages liter of (except cognac, brandy, wine, the wine material 100% and beer ) spirit Cognac, Brandy 165 (exept to cognac, tenge/ brandy, liter of produced from the 100% cognac of spirit domestic production) Cognac, brandy, 100 produced from tenge/ cognac spirit of liter of domestic the production 100% spirit Wines 20 tenge/ liter Wine material (except the sold

100 tenge/

800 tenge/ liter of the 100% spirit 800 tenge/ liter of the 100% spirit

250 tenge/ liter of the 100% spirit 230 tenge/ liter of the 100% spirit

75 tenge/ liter

130 tenge/ liter of the 100% spirit 20 тенге/л итр

170 tenge/

100 tenge/

-

800 tenge/ liter of the 100% spirit 800 tenge/ liter of the 100% spirit

300 tenge/ liter of the 100% spirit 280 tenge/ liter of the 100% spirit

75 tenge/ liter

150 tenge/ liter of the 100% spirit 20 тенге/л итр

170 tenge/

100 tenge/

-

78

800 tenge/ liter of the 100% spirit 800 tenge/ liter of the 100% spirit

350 tenge/ liter of the 100% spirit 325 tenge/ liter of the 100% spirit

75 tenge/ liter

160 tenge/ liter of the 100% spirit 20 тенге/л итр

170 tenge/

100 tenge/

-

800 tenge/ liter of the 100% spirit 800 tenge/ liter of the 100% spirit

400 tenge/ liter of the 100% spirit 325 tenge/ liter of the 100% spirit

650 500 tenge/ tenge/ liter of liter of the the 100% 100% spirit spirit 800 325 tenge/ tenge/ liter of liter of the the 100% 100% spirit spirit

75 tenge/ liter

160 tenge/ liter of the 100% spirit 20 тенге/л итр

75 tenge/ liter

170 tenge/ liter of the 100% spirit 35 tenge/ liter

170 tenge/

100 tenge/

170 tenge/

170 tenge/

-

-

2205, 2206 00

From 2204, 2205, 2206 00

79

From 2203 00

for the production of ethyl spirit and alcoholic beverages) Wine material, sold for the production of ethyl alcohol and alcoholic beverages Beer

From2203 Beers with 00 volume content of ethanol spirit not more than 0,5 percent From2402 Filter cigarettes

From2402 Cigarettes without filters, cigarettes From2402 Cigarillos

liter

liter

liter

liter

liter

liter

liter

liter

liter

liter

liter

0 tenge/ liter

75 tenge/ liter

0 tenge/ liter

75 tenge/ liter

0 tenge/ liter

75 tenge/ liter

0 tenge/ liter

75 tenge/ liter

0 tenge/ liter

75 tenge/ liter

20 tenge/ liter

10 tenge/ liter 0 tenge/ liter

60 tenge/ liter 0 tenge/ liter

13 tenge/ liter 0 tenge/ liter

60 tenge/ liter 0 tenge/ liter

20 tenge/ liter 0 tenge/ liter

60 tenge/ liter 0 tenge/ liter

25 tenge/ liter 0 tenge/ liter

50 tenge/ liter 0 tenge/ liter

25 tenge/ liter 0 tenge/ liter

50 tenge/ liter 0 tenge/ liter

26 tenge/ liter 0 tenge/ liter

600 tenge/ 1000 items 350 tenge/ 1000 items 1040 tenge/

750 tenge/ 1000 items 570 tenge/ 1000 items 1220 tenge/

800 tenge/ 1000 items 500 tenge/ 1000 items 1140 tenge/

950 tenge/ 1000 items 570 tenge/ 1000 items 1220 tenge/

79

1000 tenge/ 1000 items 600 tenge/ 1000 items 1220 tenge/

From2402 Cigars

From 2403

80 From 2709 00 From 8702, From 8703, 8704

Pipe tobacco, smoking, chewing, sucking, snuff, hookah and other packed in consumer packaging and made for final consumption, except of pharmaceutical products containing nicotine Crude oil, natural gas condensate Cars with engine capacity over 3000 c.c.

1000 items 85 tenge/ 1000 items 1000 tengе/ kg

1000 items 95 tenge/ 1000 items 1220 tengе/ kg

1000 items 85 tenge/ 1000 items 1000 tengе/ kg

1000 items 95 tenge/ 1000 items 1220 tengе/ kg

1000 items 95 tenge/ 1000 items 1220 tengе/ kg

0 teng/ ton 100 tenge/ c.c.

80

Rates of excise on petrol and diesel № subitem

1 1.

2. 3.

4.

5.

2 Wholesale by the gasoline producers (except aviation) and diesel fuel of the domestic production Wholesale by individual and legal entities of petrol (except for aviation) and diesel fuel Retail sales by the gasoline producers (except aviation), and diesel fuel, the use in their own production needs Retail sales of individual and legal entities of petrol (except for aviation) and diesel fuel, use in their own production needs Imports

Excise rates for 1 ton (in tenge)) Gasoline (except Diesel aviation) (Code FEACN (Code FEACN EurAsEC EurAsEC 2710 11410 2710 19 31000-2710 11590 0) 2710 19 490 0) 3 4 4500 540

0

0

5000

600

500

60

4500

540

Note. The nomenclature of good is determined by the code FEACN EurAsEC and (or) by the name of the items. The gasoline and diesel fuel sale in the retail industry is made in liters. The conversion of the ton to the liter is made with the use of density, depending on the temperature at which the measurements are made. 1 ton = 1000 kg / density coefficient in kg / liter (DC)

DC

AE-80 0,73

Type of gasoline AE-92 AE-93 0,75 0,75

81

AE-96 0,75

Type of diesel fuel DFW DFS 0,80 0,80

The procedure for calculation the excise  The calculation of the excise tax is made by applying of the set rate of the excise to the tax base according to Art. 280 of the Tax Code of RK. Terms of payment of excise duty  The excise on excisable goods has to be transferred to the budget no later than the 15th day of the month following the tax reporting period.  on the excisable goods manufactured from give-and-take raw materials and materials, excise is paid on the day of transfer of goods to the customer or the person specified by the customer.  During the transferring of crude oil, gas condensate extracted in the Republic of Kazakhstan for the industrial processing, the excise is paid on the date of transfer.  The excise on excisable goods specified in s.i. 2) of Art. 279 of the Tax Code, with the exception of wine material and beer, is paid earlier befor getting of the accounting and control marks. Taxable period  calendar month. Submission deadline of the tax declaration  At the end of each tax period, the taxpayer has to submit to the tax authorities at the place of his registration the excise declaration (form № 400) no later than the 15th day of the second month following the tax period. Checklists. 1. Who is the payer of excise duty? 2. In which case the individual importing the excisable goods is released from the payment of the excise? 3. What is the tax base for excise tax? 4. What is the object of the taxation in the gambling business? 5. Do the cars produced in the RK taxed by the excise ? 6. What products are included in the list of excisable goods? 7. What types of business activities are excisable? 8. What products have to be marked with the excise stamps? 9. Is the export taxable by the excise?

82

10. How many days does the taxpayer have before providing the documentation proving the export? 11. What are terms of payment of excise duty? 12. What is the reporting period for excise?

Task № 1. There were produced 2000 bottles of cognac in volume of 0,7 liters, 500 bottles of vodka in volume - 0,5 liter, 200 bottles of wine in volume of 0,75 liters. Determine the sum of excise tax for alcoholic beverages produced in the RK. The solution: Cognac: 2000 * 100 * 0,7 * 0,4 (40%) of waterless content of the spirit = 56000 Vodka: 500 * 250 * 0,5 * 0,4 = 25 000 Wine: 200 * 0,75 * 20 = 3000 Task № 2. The company imported to Kazakhstan 1250000 packs of cigarettes. In one pack there are 20 cigarettes. The excise rate is 2 Evro/1000 pieces. Rate of Euro is 163 tenge. Solution: Tax base = 1250000 * 20 = 25000000 cigarettes Excise sum = (25000000 x 2 x 163): 1000 = 8150000 tenge Task № 3. LLP «Sarah» is selling the excisable products. In February 2008, the import of excisable goods in the territory of the Republic of Kazakhstan in the amount of 13 500 units was made. Customs declaration has been submited in the Aktau sea port. The customs value was 60 000 Euro. At the time of the submission of the customs declaration the rate of Euro was 162 tenge. During the loading and unloading of products thgere were broken 70 units of goods. 5700 units were sent for the sale to Astana, and 5000 units - in Almaty. Information: Customs duty was 7% of the customs value, customs duty 10% and excise rate per unit of good is 1,5 euros. 83

It is required to calculate tax duties appeared in the LLP «Sarah.» The solution: (60 000 (60 000 * 7%) + (60 000 * 10%) + (13 500 * 1,5)) * 162 = (60 000 + 4200 + 6000 + 20250) * 162 = 90 450 * 162 = 14652900 * 12% = 1758348 tenge Import VAT - 1758348 tenge, Art. 246, 247 Excise - 20250 * 162 = 3280500 tenge Art. 297, 298 Sending to the sale is not an object to excise taxation, since the shipment of the goods to its structural subdivisions of the manufacturer is taxable, Art. 281

Theme № 9. Tax on gambling Payers  Legal entities and individual entrepreneurs having the activities in services: a casino, a hall of slot machines, tote, bookmaker office. Object of taxation  Game Table  Game Slot  Cash of the tote  Electronic cash of the tote  Cash of the bookmaker office  Electronic cash of the bookmaker office Rates of the tax calculation Calculation of the tax is done independently by applying of the appropriate tax rates to the objects of taxation:  Game Table - 830 MCI per month  Game Slot - 30 MCI per month  Cash of the tote - 125 MCI per month  Electronic cash of the tote - 125 MCI  Cash of the bookmaker office - 75 MCI per month  Electronic cash of the bookmaker office- 75 MCI per month Taxable period  The tax period is set - the quarter. Tax deadline  During the enter in the production mode of the taxable objects by the 15th day of the month the tax on the gambling business is calculated at the known rate, but after the 15th day - in the sum of half of the set rate.  During the releasing of the taxable items before the 15th day of the month the tax on gambling is calculated at the rate of 1/2 of the set rate, after the 15th - at the set rate.

85

 The tax on gambling business has to be paid to the budget at the place of registration of objects of taxation no later than the 25th day of the second month following the tax reporting period. Submission period of the declaration  Declaration (form № 710) is submitted no later than the 15th day of the second month following the tax reporting period. Special conditions of this type of tax calculation  In case of exceeding the income gotten from activities in the field of gambling over the limit one then the taxpayershould pay an additional payment of tax payers The limit sum of income for the tax period: for the tax payers on gambling business is  with the casino operation - 135 000 MCI;  with the hall with slot machines operation - 25 000 MCI;  with the tote operation - 2500 MCI;  with the bookmaker office operation - 2000 MCI. The procedure of the calculation and payment of the additional payment  An additional payment is calculated by applying of the rate to the excess of the limit sum of income rate and has to be paid no later than the 25th day of the second month following the tax reporting period.  When the payers of the gambling industry are doing several types of activities in the gambling are the additional payment has to be calculated separately from the income of each activity in the gambling business. Checklists 1. Who are the payers of the tax on gambling ? 2. What are the objects of taxation on gambling? 3. What is the tax rate on gambling? 4. In which case does the additional payment of tax payers on gambling paid? 5. What is the tax period of tax on gambling? 6. What is the deadline of payment of tax on gambling? 7. Deadline for submission of the tax declaration for the tax on gambling?

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Theme № 10. Rental tax for export Payers  The individual and legal entities selling for the export the crude oil, gas condensate, coal, except for subsoil users that export volumes of crude oil, gas condensate, obtained under the contracts signed between the Government of the Republic of Kazakhstan or the competent authority and the subsoil user before January 1, 2009 and passed the needed tax expertise, as well as the subsoil contract for the usage, approved by the President of the Republic of Kazakhstan. Object of taxation  The volume of crude oil, gas condensate, coal sold for the export. Base for calculation of the rent tax  The tax base for the calculation of the rent tax for the exports of crude oil, gas condensate is the value of exported crude oil, gas condensate, calculated on the basis of the actually sold on the export the volume of crude oil, gas condensate, and the world price, calculated in the manner prescribed by s. 3 of Art. 334 of Tax Code.  The tax base for the calculation of the rent tax on the export for the coal is the price of the exported coal, calculated on the basis of the actually sold coal via esport.  monetary form of payment of the rent tax for export of crude oil and gas condensate by the decision of the Government of the Republic of Kazakhstan can be replaced by the natural form in the manner set by the additional agreement signed between the public authorities and the taxpayer. Taxable period  calendar quarter. Procedure of tax payment  taxpayer has to pay to the budget the calculated sum of tax no later than 25th day of the second month following the tax period. Submission deadline of the tax declaration Declaration (form № 570) of rent tax on exported crude oil, gas condensate, is submitted to the tax authority at the place of 87

registration no later than the 15th day of the second month following the tax period. The tax rates  Rates of the rent tax on exported crude oil, gas condensate are set depending on the determined market price per barrel from 0% to 32%: Rent tax rates for export № subitem 1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19.

world price

Rate, in%

2 Up to $ 20 U.S. dollars per barrel inclusively Up to $ 30 U.S. dollars per barrel inclusively Up to $ 40 U.S. dollars per barrel inclusively Up to $ 50 U.S. dollars per barrel inclusively Up to $ 60 U.S. dollars per barrel inclusively Up to $ 70 U.S. dollars per barrel inclusively Up to $ 80 U.S. dollars per barrel inclusively Up to $ 90 U.S. dollars per barrel inclusively Up to $ 100 U.S. dollars per barrel inclusively Up to $ 110 U.S. dollars per barrel inclusively Up to $ 120 U.S. dollars per barrel inclusively Up to $ 130 U.S. dollars per barrel inclusively Up to $ 140 U.S. dollars per barrel inclusively Up to $ 150 U.S. dollars per barrel inclusively Up to $ 160 U.S. dollars per barrel inclusively Up to $ 170 U.S. dollars per barrel inclusively Up to $ 180 U.S. dollars per barrel inclusively Up to $ 190 U.S. dollars per barrel inclusively Up to $ 200 U.S. dollars per barrel and above

3 0 0 0 7 11 14 16 17 19 21 22 23 25 26 27 29 30 32 32

Checklists 1. Who are the payers of rent tax on exports? 2. The object of taxation of the rent tax on exports? 3. From what do depend the rates of the rent tax on exports? 4. What is the tax period for rent tax on exports? 5. What are terms of payment of rent tax on exports?

Theme № 11. Fixed tax Applied definitions are meant as the following:  pool table - a special table with pockets (holes in the sides) and without them, designed for the game in billiard;  game track - special track designed for game in bowling (bowling alley);  game slot without a win - special equipment (mechanical, electrical, electronic and other technical equipment) used for the Games;  Kart - racing micro-liter car without a carcass, and the differential and elastic wheel suspension, which has a duple engine with a capacity of 250 cubic centimeters and a maximum speed of 150 kilometers per hour. Payers Fixed tax payers are individual entrepreneurs and legal entities working in service activities with the use of:  slot machines without a win;  personal computers used for games;  game tracks (bowling (bowling alley);  kart (karting);  billiard tables (billiards). Object of taxation The object of taxation by the fixed tax are:  Game slot without a win, designed for single player game;  Game slot without a win, designed for games with more than one player;  personal computer used for games;  Game track;  Kart;  pool table. Fixed tax rate  the minimum and maximum base rates of the fixed tax per unit of taxation per month are ones from 1 to 25 MCI. 89

Fixed tax rate

№ s.i.

Name of the object of taxation

1.

Slot machine without a win, made for single player game Slot machine without a win, made for games with more than one player Personal computer used for the conducting of the game Game road Kard Billiard table

2. 3. 4. 5. 6.

The minimum size of the base rates of FT (in MCI)

maximum basic rate of FT (in MCI)

1

12

1

18

1 5 2 3

4 83 12 25

Taxable period  The tax period for the fixed tax is a calendar quarter. Procedure of the calculation and payment deadline of the fixed tax  Calculation of the fixed tax is done by applying the appropriate tax rate for each taxable object.  During the enter in service of taxable objects before the 15th day of the month the fixed tax is calculated at the set rate, but after the 15th day - in the sum of half of the established rate.  On disposal of taxable items before the 15th day of the month the fixed tax is calculated as for the half of the month after the 15th day - at the set rate.  The fixed tax has to be paid at the place of registration of the objects of taxation no later than the 25th day of the second month following the tax reporting period.  In the activities of other types of business, fixed tax payers are required to keep separate records of income and expencies on such activities, and to do payments with the budget in the normal manner. 90

Deadline for submission of the tax declaration  The declaration on the fixed tax is submitted no later than the 15th day of the second month following the reporting quarter, at the tax authority at the location of the objects of taxation. Checklists 1. Who are the fixed tax payers? 2. What are the taxable objects of the fixed tax? 3. What are the fixed tax rates? 4. What is the procedure of the calculation and payment of the fixed tax?

Section IV. Taxation of the subsoil users Types of payments for subsoil users Taxation of the activities of subsoil operations sets the procedure for the calculation and payment of taxes and special payments of the subsoil users. 1) special payments of the subsoil users:  signing bonus;  commercial discovery bonus;  payment for compensation of historical costs; 2) the tax on mining; 3) the excess profits tax. Bonus - a payment associated with the geological survey of mining. Commercial discovery – a stock of the certain kind of minerals discovered within the contract area, which is a cost-effective for the mining.

Theme № 12. Special payments of subsoil users The tax regime set for the subsoil user, is defined in the subsoil use contract. In this case, the contract has to pass the tax expertise and state registration at the relevant government authorities.  first - provides the payments by a subsoil users of the taxes and other mandatory payments except the share of the Republic of Kazakhstan in dividing of the goods  second - provides for the payment (transfer) by the subsoil users of the share of the Republic of Kazakhstan in divifing of goods, as well as all taxes and other mandatory payments, except for rent tax on exported crude, excise on crude oil, including gas condensate, the excess profits tax, land tax and property tax. The second model is only applied in the contracts about the sharing goods. Types of bonuses, the order of payment and submission of the declaration 92

 Signature bonus - a one-time fixed payment for the right to do activities on the subsoil use in the contract area. The starting sizes of the signature bonuses are determined by the Government of the Republic of Kazakhstan on the basis of a calculation based on the size of mineral resources and the economic value of the deposit. This 50% bonus is paid to the budget no later than 30 calendar days from the date of declaration of the taxpayer as a winner of the competition. The remaining 50% of the signing bonushas to be paid no later than 30 days from the date of the entry into force of the subsoil use contract. Declaration of the signature bonus is submitted by the subsoil tax at the tax authority at the place of registration before the 15th day of the second month following the month in which the deadline has happened.  commercial discovery bonus is paid for each commercial discovery in the contract area, except contracts for exploration of mineral deposits not considered their following mining. The object of taxation is the physical volume of the obtained mineral reserves,  commercial discovery bonus is paid at the rate of 0,1% of the calculation basis no later than 90 days from the date of approval by the authorized for these purposes state body of the size of the mined mineral reserves at the deposit. Declaration of the bonus is submitted by the subsoil user before the15th day of the second month following the month in which the payment deadline has happened.  The sum of historical costs made by the state for the geological exploration and settlement of the respective contract area is calculated by the authorized state body in accordance with the legislation of the Republic of Kazakhstan and paid to the budget in accordance with the regulation of this Article. Part of the sum of historical cost in accordance with the legislation of the Republic of Kazakhstan on Subsoil and subsoil users has to be payable to the budget in the form of payment for the obtainig of the geological information being in the state property. The rest part of the historical costs is to be paid to the budget in the form of payment for compensation of historical costs. Payment for compensation of historical costs made by the state for the geological exploration and settlement of the 93

respective contract area is paid by the subsoil user from the beginning of subsoil mining phase after a commercial discovery in the following order:  if the total sum of payment for compensation of historical costs made by the State in the geological exploration and settlement of the respective contract area, has the sum lower than the 10 000times size of the monthly calculation index set for the corresponding financial year by the law on the national budget, then the payment for compensation of historical costs is paid no later than April 10 of the year following the year in which the subsoil user has started to the mineral mining;  if the total sum of payment for compensation of historical costs made by the State in the geological exploration and settlement of the respective contract area, has the sum exceding 10 000-times size of the sum of the monthly calculation index set for the corresponding financial year by the law on the national budget, then the payment for compensation of historical costs is paid by the subsoil user quarterly in equal parts in an sum equivalent to the one of not less than 2500-times size of the the monthly calculation index set for the corresponding financial year by the law on the national budget, according to the schedule agreed with the authorized state body for the economic expertise service, but not more than ten years.

Theme № 13. Excess profits tax Excess profits tax is calculated for the tax period for each individual subsoil use contract by which the subsoil user is the payer of the excess profits tax. For purposes of calculation the tax on excess the subsoil user determines the object of taxation, as well as the following ones related to taxation, for each individual subsoil use contract in accordance with the procedure specified in this chapter: 1) net income for purposes of calculation the tax on the excess profit; 2) taxable income for purposes of calculation the tax on the excess profit; 3) the total annual income for the subsoil use contract; 4) deductions for excess profit tax calculation purposes; 5) the corporate income tax in the subsoil use contract; 6) The estimated sum of the tax on the net income of the permanent company of non-residents on the subsoil use contract. Payers  payers of the excess profit tax are the subsoil users on the activities carried out by each individual subsoil contract, except for the subsoil use contracts referred to in s.2 of this Article.  Are not payers of the excess profit tax established by this chapter, the subsoil users for activity on the basis of the following subsoil use contracts: 1) referred to in s. 2 of Art. 308 of the Tax Code; 2) for the exploration, exploration and mining, or minig of common minerals, groundwater and (or) therapeutic mud, in case if these contracts do not provide the mining of other types of minerals; 3) the construction and operation of underground facilities not related to the exploration and mining. Object of taxation  The object of taxation on the excees profits is part of the net income of the subsoil user defined for the purposes of calculation the excess profits tax in accordance with Art. 348-1 of the Tax Code for each individual subsoil use contract for the tax period exceeding the sum equal to 25 percent of the sum of the deductions of the subsoil 95

users for the purposes of the calculation of the tax on the excees profits in accordance with Art. 348-4 of the Tax Code. Net income for purposes of calculation the excess profits tax  Net income for purposes of calculation the excess profits tax is defined as the difference between taxable income for purposes of calculation the tax on the excess profits determined in accordance with Art. 348-2 of the Tax Code, and corporate income tax at the subsoil use contract, calculated in accordance with Art. 348-5 of the Tax Code.  For non-residents performing the activities in the subsoil use in the Republic of Kazakhstan via a permanent establishment, the net income for purposes of calculation the excess profits tax is reduced by the calculated sum of the tax on the net income of the permanent establishment, related to the contract on subsoil use, calculated in accordance with Art. 349 of the Tax Code . Taxable income for purposes of calculation the tax on the excess profits  Taxable income is the purpose of this chapter is defined as the difference between the total annual income for the subsoil use contract, determined in accordance with Art. 348-3 of the Tax Code, and deductions for excess profit tax calculation purposes determined in accordance with Art. 348-4 of the Tax Code, with a decrease in the sum of income and expenses considered for by Art. 133 of the Tax Code. The total annual income for the subsoil use contract  The total annual income for the subsoil use contract is determined by the subsurface user via contract activity for each individual contract on subsoil use in the manner prescribed by this Code for the purpose of calculation the corporate income tax, in accordance with the corrections provided by Art. 99 of the Tax Code. Deductions for tax purposes profits • For the purpose of calculation the excess profits tax the deductions for each individual contract on subsoil use is defined as the sum of: 1) The expencies refered at the reporting tax period on deductions in purposes of calculation the corporate income tax on the 96

contract activity in accordance with Art.100 – 114, 116 - 122 of the Tax Code; 2) The following costs in the range:  actually incurred costs during the tax period, for the purchase and (or) the production of the fixed assets;  on the existing fixed assets introduced into the operation from January 1, 2009, within the sum of the remaining value of the given assets not refered as a deduction for the purpose of the excess profits tax in previous tax periods;  incurred during the tax period of the following expencies on the fixed assets refered in the accounting for an increase of the book value of fixed assets;  Costs of the subsoil users to be considered as deductions via the calculation of the amortization in accordance with Art. 111 and 112 of the Tax Code; 3) the losses incurred by the subsoil users for the previous tax periods on the subsoil use contract, determined in accordance with Art. 136 and 137 of the Tax Code. • The assignment on the deductions for purposes of the calculation of the excess profit tax pointed in s.s. 2) of s. 1 of this Article is made by the desire of the subsoil user partially or completely in the current or any following tax period. These expenses are refered to the deductions for the purposes of the calculation of the excess profits tax at the reporting tax period are not refered as a deduction for the purposes of the calculation of the excess profit tax at other tax periods. • During the using a right specified by the s. 2 of the current article while calculating the excess profit tax in the corresponding tax period the subsoil user has to exclude from the sum of the deductions determined in accordance with s.i. 1) of s.1 of this Article, the sum of the amortization payments refered to the deduction during the calculation of the corporate income tax of such tax period over deductions refered to the deductions for the puropses of the calculation of the excess profit tax in accordance with s.i. 2) of s.1 of the current Article.

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• If the same expenses are considered in several types of the costs set by the s. 1 of the current Article, then during the calculation of the excess profit tax the shown expenses are substracted only once. Corporate income tax for the subsoil use contract  The corporate income tax for the subsoil use contract is determined for the tax period by the contract activity for each individual contract on subsoil use as a product of the rate set by s. 1 of Art. 147 of the Tax Code, and the taxable income calculated on such contract on subsoil use in accordance with Article 139 of the Tax Code, reduced by the sum of income and expenses provided for by the Article 133 of the Tax Code, and the sum of losses for the subsoil use contract, transferred in accordance with the articles 136 and 137 of the Tax Code. Calculation procedure  The calculation of excess profits tax for the tax period is made by applying of the corresponding rate for each level set by the article 351 of the Tax Code, to every part of the object of taxation on the excess profits refered to such a level, with the following adding up of the calculated sums of the excess profits tax over all levels. For the application of s. 1 of this Article the subsoil user: 1) defines the object of taxation and the objects related to the taxation by the excess profit tax for the subsoil use contract; 2) determines the limit sums of the total distribution of the net income for purposes of calculation the excess profit tax over each level set by article 351 of the Tax Code, in the following order: for levels 1 - 6 - as the product of interest for each level specified in column 3 of the table in Art. 351 of the Tax Code, and the sum of deductions for the purposes of the calculation of excess profit tax; for level 7: in case if the sum of net income for purposes of calculation of the excess profit tax more than the sum equal to 70 percent of the sum of deductions for the purposes of the calculation of the excess profit tax – as the difference between the net income for the purposes of calculation the excess profit tax and the sum equal to 70 percent of the sum of deductions for purposes of calculation of the excess profit tax; 98

in case if the sum of net income for purposes of calculation the excess profit tax is less than or equal to the sum equal to 70 percent of the sum of deductions for the purposes of the calculation the excess profit tax - as zero; 3) distributes actually received in the tax period the net income for purposes of calculation the excess profit tax over the levels considered by the article 351 of the Tax Code, in the wollowing order: For the level 1: - If the sum of the net income for the purposes of calculation of the excess profit tax for the tax period exceeds the limit sum of the distribution of the net income for the first level, then thew distributed part of the net income for the first level is equal to the limit sum of the distribution of the net income for the first level; - If the sum of net income for purposes of calculation the excess profit tax for the tax period is less than the limit sum of the distribution of the net income for the first level, then the distributed part of the net income for the first level is equal to the sum of net income for purposes of calculation the excess profit tax for the tax period. At the same time, for the following levels the distribution of the net income for purposes of calculation the excess profit tax is not made; for levels 2-7: - If the difference between the net income for purposes of calculation the excess profit tax for the tax period and the total sum of the distributed parts of the net income for the previous levels exceeds or equal to the limit sum of the net income distribution for the corresponding level, then the distributed part of the net income for this level is equal to the limit sum of the distribution of the net income for the corresponding level; - If the difference between the net income for purposes of calculation the excess profit tax for the tax period and the total sum of the distributed parts of the net income over the previous levels less than the limit sum of the distribution of the net income for the appropriate level, then the distributed part of the net income for this level is eaual to such a difference. At the same time, for the 99

following levels the distribution of the net income for purposes of calculation the excess profit tax is not made.  The total sum distributed by levels parts of the net income has to be equal to the total net income for purposes of calculation the excess profit tax for the tax period; 4) applies the appropriate rate on excess profit tax to each distributed by the levels part of net income in accordance with article 351 of the Tax Code; 5) determines the sum of the excess profit tax for the tax period by adding the calculated sums of the excess profit tax over all the levels considered by the article 351 of the Tax Code. The excess profit tax rates, the levels and the rates of interest for the calculation of the limit sum of the distribution of the net income for purposes of calculation the excess profit tax  Excess profit tax is paid by the subsoil user on the sliding scale of rates determined in the following order: № scale of distribution of the Percentage for the calculation of net income forthe purpose of of the limit sum of the net level calculation of the tax on income distribution for the super profit, percentage of purposes od the calculation of the sum of the deduction the super profit tax profit 1 2 3 1 less than or equals to 25 25 percents 2 from 25 percents to 30 5 percent inclusive 3 from 30 percents to 40 10 percent inclusive 4 from 40 percents to 50 10 percent inclusive 5 from 50 percents to 60 10 percent inclusive 6 from 60 percents to 70 10 percent inclusive 7 over 70 percent In accordance with sub-item 2) s. 2 Art. 350 of the TC

100

Rate (in %)

4 Not applied 10 20 30 40 50 60

Taxable period  For the excess profit tax period the tax period is the calendar year from January 1 to December 31.  If the subsoil use contract was signed isuring a calendar year, the first tax period for the calculation of the excess profits tax on such a contract is the period of time from the date of the coming into force the subsoil use contract and till the end of the calendar year.  If the action of the subsoil use contract was expired before the calendar year, the last tax period for the calculation of the excess profit tax on such a contract is the period from the begining of the calendar year till the completion day of the subsoil use contract validity.  If the validity of the subsoil use contract, came into force after the start of the calendar year, expired till the end of this calendar year, the tax period for the calculation of the excess profit tax on such a contract is the period of time from the date of the subsoil use contract coming into force till the day of completion of the subsoil use contract validity . Tax payment deadline  Excess profit tax is paid to the budget at the location of the taxpayer no later than 15 April of the year following the tax period. Tax declaration  The declaration (form № 540) on the EPT is submitted by thew subsoil user to the tax authority at the location no later than 10 April of the year following the tax period. Checklist 1. What are types of special payments for subsoil use? 2. What is the definition of bonuses? 3. What are the types of bonuses? 4. The calculation and payment procedure of bonuses? 5. Who are the payers of payment of the compensation of the historical costs? 6. The procedure and terms of payment of the compensation of the historical costs? 7. In which cases do the MET (mineral extraction tax) paid? 8. What are the taxable MET objects? 9. What is the tax base of the MET? 10. What is the procedure of the calculation and payment of the MET? 11. What is the tax period and payment terms of the MET?

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Section V. Special tax regimes (STR) Category of entrepreneurs, applied the special tax regimes  small businesses  peasant (farmer) farms  legal entities - agricultural producers. Special regime for the small businesses Sets for small businesses a simplified procedure for the calculation and payment of social tax and the corporate or individual income tax, except for the individual income tax deducted from the source of the payment, and includes:  special tax regime on the basis of a patent;  special tax regime based on the simplified declaration. Object of taxation  The income for the tax period consisting of all types of income received (receivable) in the Republic of Kazakhstan and abroad, with the exception of income previously taxed, with the presence of the documents confirming the deductions of the tax at source of payment, and (or) a single coupon. Special tax regime for peasant(farmer) farms  Provides a special operational procedure with the budget on the basis of the payment of a single land tax and is applied to the activities of peasant(farmer) farms for the production of agricultural products, reproduction of agricultural products of own production and its sale, with the exception of the activity on the processing, reprocessing and sale of excisable goods. Special tax regime for the legal entities - agricultural producers  are defined the requirements to the taxpayers for the activities in the special tax regime for the legal entities - agricultural producers, which provides special procedure of the value calculation with the budget on the basis of a patent.

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Theme № 14. Special tax regime for small businesses Small businesses are free to choose one of the four orders of the calculation and payment of taxes:  Standard procedure,  special tax regime on the basis of a patent,  special tax regime based on simplified declaration.  There are some restrictions on persons who do not have the right to use this regime (legal, having subsidiaries, branches, daughter organisations), and the types of activities on which this kind of regime (consulting, finance, accounting, production of excisable products, licensed types of activities, etc.) is not applied. Object of taxation  income for the tax period consisting of all types of income received (receivable) in the territory of the Republic of Kazakhstan and abroad, with the exception of income previously taxed, in the presence the documents confirming the deduction of the tax at source of the payment, and (or) a single coupon.  calculation, payment and submission of tax reporting for other taxes and other obligatory payments to the budget are made in the normal manner.  The property income and other income of the individual entrepreneur, not taxed at source of the payment the exception of the income received from the rental property are not a taxable objects.  For small businesses, applied the special tax regime and being the payers of the value added tax, the sum of the tax of added value into the income is not included.  In the case of several types of the business activities the income is determined by the sum over all activities. Changing of the tax regime  In the transition to the generally set procedure for the calculation and payment of taxes the next movement to a special tax regime is possible only after 2 years of use of the standard procedure.

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SPECIAL TAX REGIME BASED ON PATENT A patent - a document certifying the right to use the special tax regime and confirming the payment of taxes to the budget. In case of loss or damage of the patent by the taxpayer’ application a duplicate is issued. The damaged patent has to be delivered by the taxpayer to the tax authority. Registration of the given patents is done by the tax authority in the log files (issue) for the patents. Patent is invalid without a certificate of state registration of individual entrepreneur. Ii is issued by the tax authorities during the 1st day with the presence of the appropriate documents. The application of this type of tax regime The enterpreneurs are applying :  not using the labor of the hired workers  operating in the form of private enterprise Taxable period  calendar year Determining the value of a patent Calculation of patent value is made by the entrepreneur via applying the rate of 2% to the declared income. Value of a patent has to be paid to the budget in the form of:  Individual Income Tax - ½ value of the patent,  social tax - ½ patent value, reduced by the sum of social contributions in the sum of 5%. During the exceeding of the sum of social contributions to the state social insurance fund over the sum of social tax the sum of social tax equals to zero. In case if the actual income exceeds the income stated during the obtaining of the patent, the taxpayer within 5 working days presents the excess sum and pays the tax from this sum. By the taxpayer’s application instead of the previously issued patent it is issued a new patent to him with the presenting of the actual income. In casae if the actual income is below the income declared during the obtaining of the patent, return of the overpaid value of the patent is made by the taxpayer’s application after a time card investigation made by the tax authority. After stoping of business activities before the expiration of the patent, the paid sum of tax to the return and recalculation is not subjected, except the recognition of an individual entrepreneur incapable. 104

In case if there are conditions not allowing to apply a special tax regime on the basis of a patent, the taxpayer on the basis of an application moves to a special tax regime based on simplified declaration or to the generally set order of calculation and payment of taxes, which is submited at the time of conditions allowing to apply a special tax regime on the basis of a patent. A patent is given to the enterpreneur for a period not less than one month within a single calendar year. Documents which have to be submitted to get a patent For the obtaining a patent the entrepreneur presents at the tax authority at the place of business activity:  application for a patent on a form set by the authorized government body  certificate of state registration of individual entrepreneur  documents confirming the payment of patent value, mandatory pension contributions to the pension funds and social contributions to the State Social Insurance Fund  in case of the enterpreneur’s activities needed to be licensed, the license for such activities should be present. At this situation the patent is issued for a period not exceeding the validity period of the license.  For getting of the other patent the application for a patent is given before the expiration date of the previous patent. In the case of a temporary suspension of the application the application is submitted to the tax authority at the registration in the prescribed form. THE SPECIAL TAX REGIME BASED ON THE SIMPLIFIED DECLARATION For the application of the special tax regime based on simplified declaration it is necessary to give an application in a standard form at the tax authority at the location:  Legal entities, the newly created - no later than 10 working days after the state registration 105

 Individual entrepreneurs, newly formed - on the day of the registration The conditions under which one can apply this kind of special regime For individual entrepreneurs:  limiting average number of employees for the tax period is 25 people, including the individual entrepreneur himself  limit income for the tax period is 10 mln. tenge For the legal entities:  limiting average number of employees for the tax period is 50 people  limit income for the tax period is 25 mln. tenge.  In case of non-consistency to these conditions or voluntary exit from the special tax regime the small business entity moves to the generally established procedure for the calculation and payment of taxes on the basis of an application starting from the quarter following the reporting . Tax rates for the simplified declaration  The calculation of taxes is made by taxpayer separately via the applying to the object of taxation for a tax reporting period (quarter) of the corresponding tax at the rate of 3%. At this time, the individual (corporate) income tax is payable at the rate of ½ of the calculated sum of tax under the simplified declaration, social tax – in the size of ½ of the calculated sum of tax under the simplified declaration substracting the sum of social contributions to the state social insurance fund, calculated at a rate of 5%. If you exceed the sum of social contributions over the sum of social tax the sum of social tax is zero. Benefits from tax calculation of the simplified declaration  If the average salary of employees in the reporting period was for the entrepreneurs not less than 2-fold, legal entities - not less than 2,5 times the minimum monthly index, then the sum of tax calculated for the tax period is needed to be corrected downwards by the sum of 1,5% of the tax sum for each employee based on the average number of workers. 106

 During thr exceeding the limit sum of income (for IE - 10 million tenge, for legal entities – 25 mln. tenge), is calculated the tax sum separately from the limit sum of income and from the actually received sum of income. The difference between the given sums of tax has to be paid to the budget without a correction.  The sum of tax calculated from the limit sum of income is subjected to the corrections.  During the excees of the limit average number (for IE - 25, for legal entities - 50), the correction is made only on the limit average number. Deadlines of submission for the simplified declaration  The simplified declaration is dubmitted to the tax authorities on a quarterly basis no later than the 20th day of the month following the tax reporting period. Payment of the calculated taxes is done no later than the 25th day of the second month following the tax reporting period. Submission of the simplified declaration and the payment of the tax to the tax authority is done at the place of application for applying the special tax regime based on simplified declaration Tax reporting  The simplified declaration is submitted to the tax authority at the location of the taxpayer no later than 15 day of the second month following the tax reporting period.  The payment of the individual income tax deducted from the source of payment, mandatory pension contributions to the pension funds, social contributions is made no later than the 25th day of the month following the tax reporting period. Checklists 1. What are types of special tax regime? 2. Who has no right to apply the STR? 3. What is the rate of a patent? 4. For how long one can get a patent? 5. In which case one can do business activities on the basis of a simplified declaration? 6. What are the deadlines for submission of the declaration?

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Theme № 15. The special tax regime for legal entities – agricultural producers Legal entities making this activity, choose independently a special tax regime for the legal entities - agricultural producers or generally accepted order of taxation. The chosen mode of taxation during the tax period is not changed and provides a special procedure of the calculation:  corporate income tax,  value added tax,  social tax  land tax  fees for land plot use,  property tax  vehicle tax. The special tax regime are applied to: 1) the activities of legal entities - producers of agricultural products on:  agricultural production with the land use, processing and sale of these products of own production;  producing meat and poultry (including breeding) with a full cycle (starting from youngster), bee-keeping, as well as the processing of these products of own production; 2) the activities of rural consumer cooperatives on:  the sale of agricultural products produced by peasant or farmers farms - members (shareholders) of these co-operatives;  processing of agricultural products produced by peasant or farmers farms- members (shareholders) of these cooperatives, and sale of products made from the processing of these products. Special tax regime is not applied to the activities of the taxpayers for the production, processing and sale of excisable goods.  In the activities that are not subjected to this special tax regime, the taxpayers have to keep separate records of income and expenses, assets and make the calculation and payment of the corresponding taxes and other obligatory payments to the budget for these kinds of activities in accordance with the current Code. 108

 For the applying of the special tax regime the taxpayer annually, no later than February 20, submits to the tax authority at the location of the land plot the application.  Absence of the application by taxpayer to the deadline is considered as his agreement to calculate and pay taxes and fees for the use of land plot in the normal manner.  The sums of the corporate income tax, value added tax, social tax, land tax, fees for land use tax, property tax, vehicle tax, calculated in the normal manner, have to be reduced by 70 percent. Reducing the sum of corporate income tax is also applied in the calculation of the sum of advance payment of the corporate income tax.  The payment of taxes and payment for land plot use and the submission of tax reports to the budget are made in the normal manner. Checklists 1. In which case, one can apply STR for the legal entities-agricultural producers? 2. What is thew tax period for STR? 3. What are the terms of STR applying? 4. What are the terms of payment and tax reporting on the STR?

Theme № 16. Special tax regime for a peasant farms Peasant farms choose independently a special tax regime for peasant farms or generally accepted order of taxation. Cases when the application for the use of this type of special regime is submitted  For the application of the special tax regime peasant (farmer) farms in a period no later than 20 February of the first year of application of this type of tax regime, the submit to the tax authorities at the location of land plot the application in the form prescribed by the state authority. Not applying by the taxpayer of the application to the the deadline is considered as his agreement to make payments with the budget in the normal manner.  The farms founded after February 20, submit an application for the right to use the special tax regime on the date of the obtaining of the the certificate of state registration of individual entrepreneur.  Under appearing of the right to land plot after 20 February in another administrative unit the peasant (farmer) farm submits an application for the right to use the special tax regime to the tax authority within 30 calendar days from the moment of registration with the location of the land plot.  by the taxpayers making the activities for which this special tax regime is not applied, the application for the right to use the special tax regime in the case of the creation of the right for the land plot after February 20, is submitted to the tax authorities in a period of 30 calendar days from the moment of the registration at the location of the land plot.  During the voluntary exit from the special tax regime the farm moves to the generally established procedure for the calculation and payment of taxes on the basis of the application, begining from the period following the reporting period.  The selected taxation regime during the tax period is not changable. Single land tax payers are not payers of the follosing taxes and other obligatory payments to the budget: 110

 individual income tax on income from the activity of the peasant (farmer) farm, on which this special tax regime is applied  VAT - on the turnover from the activities on which this special tax regime is applied  land tax and (or) fees for land plot use - Land plots used in the activities on which this special tax regime is applied  vehicle tax on objects of taxation within the standard of the needs  property tax on the taxable objects within the standards of the needs. The tax period on a single land tax  calendar year. Object of taxation  The basis for calculation the single land tax is the estimated value of the land plot. Calculation of a single land tax is made by applying the rate of 0,1% to the estimated value of the land plot. Terms of the tax payment  The payment of single land tax, social tax, individual income tax deducted from the source of payment, payment for the use of water resources of the surface sources, pollution charges in the environment, social contributions, the transfer of the mandatory pension contributions are made in the following order:  the sums calculated from January 1 to October 1 of the tax period, no later than November 10 of the current tax period;  the sums calculated from October 1 to December 31 of the tax period, no later than April 10 of the tax period following the tax reporting period.  The payment of social tax and individual income tax deducted from the source of payment, is made at the location of the land plot. Tax reporting  Declaration for payers of the single land tax for the previous tax period is submitted by the payers of the single land tax annually, no later than March 31 of the current tax period. Features of the applying of this regime 111

 During the operation of the types of activities on which a special tax regime for peasant(farmer) farms is not aspplied, the single land tax payers have to keep separate accounting records of income and expenses (including wages), property (including vehicles) and make calculations, providing of tax reports and payment of the corresponding taxes and other obligatory payments to the budget for such activities in the normal manner, and (or) in a special tax regime for small businesses. This is also applied during the obtaining of the property income and other income not taxable from the source of payment.  single land tax payers monthly calculate the sum of social tax at the rate of 20% of the monthly calculated index for each employee, as well as the head and members of the peasant (farmer) farms. The calculated sum of the social tax has to be reduced by the sum of social contributions to the state social insurance fund, calculated according to the sum of 5%. During the exceed of the sum of social contributions to the state social insurance fund over the sum of social tax the sum of social tax equals to zero. Checklists 1. In which case do the STR for peasant (farmer) farms applied? 2. What is the tax period for the STR? 3. What are the features of the application of the STR? 4. What are the features of the social tax calculation? 5. What are the deadlines for thew submission of the tax reporting? 6. What is the procedure for tax report filling for the STR?

Additional tasks Task 1. Income from sales of goods - 2000000 tenge Income from services -260 000 tenge The value of property transferred to equity-2000 000 tenge Rental income from the property-500 000 tenge Costs associated with obtaining TAI - 550 000 tenge The penalty paid to the buyer of goods-210 000 tenge Fine paid to the budget-180 000 tenge Expencies associated with trip-100 000 tenge Return of goods in connection with the expiration date-315 000 tenge Calculate the sum of CIT of the legal entity. Task 2. Income from services - 2300000 tenge Income from the initial IPO shares - 1500 000tenge Dividends - 250 000tenge Income on repurchase transactions-1500 000tenge Income from rental property - 400 000tenge Expencies associated with obtaining TAI - 500 000tenge Expenses related with the research-280 000tenge Calculate the sum of CIT of the legal entity. Task 3. LLP «Arlan» delayed payment of the CIT for 18 days. Refinancing rate of the National Bank - 7%. The sum of underpayment - 890 000tenge Calculate the sum of fines. Task 4. JSC «Alma» made the following operations. 1500 000 tenge –the product was shipped including the international traffic - 300 000 tenge The property was bought as a contribution to the charter capital4800000 tenge 113

The invoice was received for utility payments - 200 000tenge For the purpose of advertising it was distributed by the individuals the gifts costing 150 thous. tenge (150 units) Calculate the VAT to be paid to the budget. Task 5. Income from sales - 6 000 000 tenge Income from services -260 000tenge Value of property received as a contribution to the charter capital - 1000 000tenge Income from rental of property-500 000tenge Costs associated with obtaining TAI - 550 000tenge The penalty paid by the purchaser of goods-210 000tenge Fine paid to the budget-180 000tenge Costs associated with a trip-100 000tenge Return of goods in accordance with the expiration date - 315 000tenge Calculate the CIT of the legal entity. Task 6. The company A is mining in commercial level the natural gas. Cost of natural gas 500 Euro per cubic meter. In the reporting period it was extracted 15 000 million cubic meters of gas including 1 mln.cub.m. of gas was put back. Determine the size of MRT. Task 7. LLP «Alan» has 50 units of the slot machines. LLP started its activity on January 18. Gambling business tax has been paid with a delay of 30 days. Calculate the tax on gambling, and the sum of the fine. Task 8. As the property of Mukhamedieva L.M. (military officer) there is a flat costing 12mln.tenge. Calculate the tax on the property of an individual.

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Task 9. LLP «Yrys» produces cotton and owns the land plot: 1) area of 85 hec., located in the desert area, the type of the bonitet - 62, 2) area of 35 hec., located in the semi-desert area, the type of the bonitet is 51. Calculate the tax on the ground of the legal entity. Task 10. The owner of the vehicle with an engine capacity 2998 cm3, «Toyota Highlander», a car with an engine capacity 3498 cm3 “Nissan 350z” delayed the payment of tax on vehicles, and made the payment on February 25 following the reporting one. Calculate the tax on vehicles for two cars, and the sum of fines. Task 11. The owner of the vehicle with an engine capacity 3500 cm3 «Lexus GS300» paid to the budget the tax on vehicles March 1 following the reporting one. How much will be the tax on the car and the sum of fine? Task 12. The individual has the following vehicles: • Bus for 12 seats • Vehicle with an engine 2000cm3 of the brand Audi A3 Cabriolet • Snowcar with engine capacity of 55 kW Calculate the tax on vehicles of an individual. Task 13. Individual has the following property: • Bus for 8 seats •Vehicle with an engine 2800cm3 brand Audi A3 Sabriolet • apartments in Almaty, total area of 470 sq. m. • apartments in Kyzylorda, total area of 500 sq. m. Calculate the tax on the property of an individual. 115

Task 14. JSC «Kazakhstan Aluminium» has the aluminum factory in Pavlodar with the total area of 10 000m2. In the plant area a building of estimated value 500 million tenge is located. Also, the organization has the factory on the reprocessing of the mineral outside the Karagandy with a total area of 1,5 hectares. The type of bonitet is 90. Buildings located on the plant territory is estimated at 300 million tenge. The organization also has vehicles: • A car Toyota with an engine 2800cm3 • 5 loading cars with load capacity 5, 10, 15, 30, 35 tons respectively; • 3 buses fro 25 people; • the helicopter bought in USA in 2008 year with the power of 200 kW; Calculate the tax on vehicle, property, land Task 15. Employee for one month was accrued the salary of 300 000 tenge. Calculate the IIT. Task 16. Individual receives a salary of 500000 teңge as a member of the Board of Directors. He also receives a dividend as a shareholder of JSC annually of 2 million tenge. He transfered 20% of salary to the pension funds as voluntary contributions (3 times in that year). Calculate IIT of the individual. Task 17. Individual put to the bank as a deposit 5 million tenge, with an annual profit of 10%. Also, he owns an office with a monthly rent of 150 000 tenge. Calculate the IIT of the individual of the mentioned above objects. Task 18. Mrs. Ongarova A.E. has the following income: A) accrued wage-115 000 tenge B) Win - 5000 tenge 116

C) Payments for medical care 15 000 tenge. Calculate IIT of individual. Task 19. Individual has property costing 8700000 tenge. Calculate the tax on the property. Task 20. Individual has the property: - Apartment of 500 square meters, - Private house in Taraz with area of 200 square meters, and the surrounding area of 5 hundreds, - The sauna with area of 60 square meters; Calculate the sum of the land tax of individual. Task 21. LLP «Asan» produces the agricultural crops. The company is located in Almaty region, Enbekshikazakh area. The company has the property: -70 Hectares of land plot(semi-desert and desert zone) bonitet score -76, - there is a plant with an area of 15 hectares. Calculate the sum of the land tax for LLP «Asan». Task 22. Legal person delayed payment of land tax for 45 days. The land tax was 800 000 tenge. Refinancing rate of the National Bank of 7%. Calculate the sum of fine on land tax of the legal entity. Task 23. Mrs. B. Asylova robtained the following income: - accrued salary 50 000 tenge - State social assistance 20 000 tenge - Apartment given by company 20 million tenge Calculate IIT of the Mrs. B. Asylovoy. 117

Task 24. IE has business estimated at 12 million tenge. The business was bought-05.05.2010 year. Calculate the sum of the property tax of IE «Akhmetov» for 2010. Task 25. LLP in 2010 made the following operations: - Saled of goods 200 000 tenge; - Imported goods worth 500 000 tenge; - Non-residents are paid for the international transport services 90 000 tenge; - Paid utilities of 220 000 tenge. Determine the amount of VAT payable to the budget. Task 26. LLP sold goods costing 5 million tenge, and the expencies for the raw materials were 3,5 million tenge. Calculate the amount of VAT payable to the budget. Task 27. IE has 15 slot machines and 12 pool tables. According to the decision of the authorized body the base rate of the fixed tax is determined by the maximum. Calculate the sum of the fixed tax of IE. Task 28. Mrs. D.S. Ospanova in 2010 had the following income: - Accrued salary 50000 tenge - Got a flat, with the market value of 8 million tenge from his father as a gift - Won 200 000 tenge in lottery «Tulpar» Calculate IIT of the Mrs. Ospanova D.S. Task 29. During the year Mr. Karmanov E.A. had the following income: - accrued salary - 600 000 tenge; 118

- got the interest on government securities- 1 million tenge.; - got a reward of 500000 tenge from the company; - Received interest on bank deposits of 400 000 tenge; - got compensation for the trip in the amount of 200 000 tenge. (within the norms). Calculate the amount of IIT for the year of Mr. E.A. Karmanova. Task 30. LLP «Sana» is working on the basis of the tax treatment under the simplified declaration. In the current tax period the LLP showed an income of 24 million tenge. The number of hired workers is 35 people. Each employee receives a monthly salary of 50000 tenge. Calculate the taxes to the budget paid by the LLS. Task 31. Casino is working in the gambling business with 10 gaming tables and 20 slot machines. Determine the sum of tax on gambling in the 1st quarter of this year. Task 32. Tote has the following data for the last quarter. The sum of income is 4500000 tenge. Determine the sum of tax on gambling, and the sum of additional payment. Task 33. Legal entity exported in 1st quarter of this year, 125 000 tons of crude oil. The world price for the period was $ 110 per barrel. Dollar exchange rate $ 1 US Dollar=150 tenge. Determine the sum of the rent tax on exports, and specify the terms of payment and submission of the declaration. Task 34. Legal entity sold for export 250 000 tons of coal. The cost per ton of coal was 10 000 tenge. Determine the sum of the rent tax on exports 119

Task 35. Game Center «Sharoban» provides the services of bowling and billiards room with 8-game tracks hall slot and two halls with pool tables, in each room there are three pool tables. Fixed tax rates: 1) per one game track - 85 MCI; 2) per one pool table - 20 MCI. Determine the sum of the fixed tax for the 2nd quarter of this year. Task 36. Game Center «Success» provides bowling and billiards room with a single game with 6 game tracks and one room with four pool tables. On March 10 there were set seven slot machines without a win, including 4 for two-player games, and 3 for the game with one player. Fixed tax rates are set 1) one game track - 80 MCI; 2) in one pool table - 22 MCI; 3) on the slot machine without a win with one player - 13 MCI; 4) on the slot machine without a win with two players - 16 MCI Determine the sum of the fixed tax for 1 and 2 quarter of this year. Task 37. The company is minig minerals in the contract territory of Kazakhstan. Price of the extractedmineral reserves 146000000 tenge. Commercial discovery bonus rate is 2%. Determine the size of the bonus.

References 1. Ermekbaeva B. Problems of development of the Republic of Kazakhstan tax system under the globalization of economy. – Almaty, 2007. 2. The code of the Republic of Kazakhstan “On taxes and other mandatory payments to the budget, as of January 1, 2011”. 3. Ermekbaeva B. Zh., Arzaeva M.J., Mustafina A.K. Workshop on the course the tax and taxation. – Almaty, Kazakh university, 2006. 4. Collection of «300 questions and answers on the tax legislation». – Almaty, 2009.

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Academic publication

Bayan Ermekbaeva, Rimma Sagieva, Raigul Doszhan TAXES AND TAXATION Educational manual Шығарушы редакторы Гүлжан Рүстембекова Компьютерде беттеген Сәуле Сарпекова Мұқабасын көркемдеген Ринат Сқақов ИБ №6561 Басуға 02.08.2013 жылы қол қойылды. Пішімі 60х84 1/16­. Көлемі 7,625 б.т. Офсетті қағаз. Сандық басылыс. Тапсырыс №805. Таралымы 100 дана. Бағасы келісімді. Әл-Фараби атындағы Қазақ ұлттық университетінің «Қазақ университеті» баспасы. 050040, Алматы қаласы, әл-Фараби даңғылы, 71. «Қазақ университеті» баспаханасында басылды.

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