Impact of recent amendments to the Tax Code
The recent amendments to the Tax Code, enacted through the Amending Law of 12 December 2023, have notably enhanced the tax position of Kazakh companies involved in transactions with related entities.
Prior to these changes, effective from 1 January 2023, the deductibility of certain expenses paid to related parties was capped at 3% of taxable income. This limitation impacted costs such as management, consulting, auditing, design, legal, accounting, advocacy, advertising, marketing, franchising, financial (excluding interest), engineering, and agency services fees, as well as royalties.
These regulations placed Kazakh companies within international groups at a competitive disadvantage. However, the Amending Law now specifies that these restrictions are confined to payments made to entities registered in low-tax jurisdictions. Consequently, transactions with companies registered in the EU, US, and other major economic partners are exempt from these constraints.
It's crucial to note that these amendments are retroactive. Thus, all relevant expenses incurred during the year, previously considered non-deductible or only partially deductible, will now be exempt from these limitations, provided they meet the arm's length standard and satisfy general deductibility criteria.
These regulations placed Kazakh companies within international groups at a competitive disadvantage. However, the Amending Law now specifies that these restrictions are confined to payments made to entities registered in low-tax jurisdictions. Consequently, transactions with companies registered in the EU, US, and other major economic partners are exempt from these constraints.
It's crucial to note that these amendments are retroactive. Thus, all relevant expenses incurred during the year, previously considered non-deductible or only partially deductible, will now be exempt from these limitations, provided they meet the arm's length standard and satisfy general deductibility criteria.
Мы предлагаем рекомендации относительно того, освобождены ли от этих ограничений конкретные трансграничные платежи связанным сторонам.
Мы можем оценить, могут ли теперь подпадать под вычет какие-либо расходы, понесенные в 2023 году, первоначально считавшиеся не подлежащими вычету.
Более подробно мы обсудим это на вебинаре по этим и другим нововведениям в области налогообложения в Казахстане, который запланирован на 10:00 по центральноевропейскому времени 28 февраля.
