Taxation of peasant and farm enterprises Printable versionLast update: 17.01.2023
Special tax regime for peasant and farm enterprises
Pursuant to Article 702 of the Tax Code, a special tax regime for peasant/farm enterprises is applied to peasant/farm enterprises that are non-payers of value added tax specified in subclause 1) of Clause 1 of Article 367 of the Tax Code, if there are land plots on the territory of the Republic of Kazakhstan on the rights of private ownership and (or) land use (including the right of secondary land use).
In order to apply special tax regime for peasant/farm enterprises, the total area of agricultural land plots on the rights of private ownership and (or) land use (including the right of secondary land use) should not exceed the size of the limit area of the land plot established for:
- 1st target area: 5 000 ha;
- 2nd target area: 3 500 ha;
- 3rd target area: 1 500 ha;
- 4th target area: 500 ha.
The special tax regime for peasant/farm enterprises provides for a special procedure for settlements with the budget based on the payment of a single land tax and applies to the activities of peasant or farm enterprises for the production of agricultural products and their sale, processing of agricultural products of their own production, sale of products of such processing, except for activities related to production, processing and sale of excisable goods.
Pursuant to Article 703 of the Tax Code, a taxation object for a taxpayer applying a special tax regime for peasant/farm enterprises is income received during a tax period from sale of agricultural products, own products of agricultural processing, except for activities related to production, processing and sale of excisable goods.
Calculation of a unified land tax is carried out by a taxpayer on his/her own by applying a rate of 0.5 percent to a taxation object for a reporting tax period.
Payment of a unified land tax and fees for the use of water resources from near-surface sources are made in the following order:
1) amounts calculated from January 1 to October 1 of the tax period: no later than November 10 of a current tax period;
2) amounts calculated from October 1 to December 31 of the tax period: no later than April 10 of a tax period following a reporting tax period.
Payment of a unified land tax is made to the budget at the location of a land plot.
The calculated amounts are reflected in the declaration in the form 920.00 for payers of the unified land tax, including:
- unified land tax,
- individual income tax withheld at the source of payment,
- fees for the use of water resources of near-surface sources,
- social payments.
A declaration for payers of a single land tax is submitted to the tax authorities at the location of a land plot no later than March 31st of the tax period following the reporting tax period.
Payers of the unified land tax do not need to pay the following types of taxes and fees to the budget:
PIT from income obtained for activities of a peasant or farm enterprise, including income received as funds from the state budget to cover costs (expenses) related to activities covered by a special tax regime;
land tax and (or) fees for the use of land plots for land plots used in activities covered by a special tax regime, except for land plots used in violation of the legislation of the Republic of Kazakhstan;
vehicle tax (for taxation objects specified in subclauses 1) and 2) of Clause 3 of Article 490 of the Tax Code);
property tax (for taxation objects specified in subclauses 1) of Clause 3 of Article 517 of the Tax Code);
social tax (for the activities of a peasant or farm enterprise, to which a special tax regime applies);
environmental impact fee (for the activities of a peasant or farm enterprise, to which a special tax regime applies).
When receiving income from activities that, in accordance with Clause 3 of Article 702 of the Tax Code, are not subject to a special tax regime, taxpayers calculate and make a payment of relevant taxes and also submit tax reports on them in one of the following tax regimes in accordance with the conditions of their application established by the Tax Code:
1) special tax regimes for small businesses: upon compliance with the conditions for application of such taxation regimes established by the Tax Code.
At the same time, an amount of income for the purposes of applying the limit on the amount of marginal income for such regimes does not include income from implementation of activities that are subject to special tax regime for peasant or farm enterprises;
2) in a generally established manner.
How to report to the budget if two tax regimes are applied
If a peasant farm has decided to apply two tax regimes simultaneously for different areas of its activity, then it is necessary to:
- ensure separate accounting of income from activities falling under a special tax regime and from other activities;
- submit reports on each tax regime in due time.
For example, if a farm has decided to apply a facilitated procedure for other types of activities, it will be necessary to submit a tax reporting form 910.00 within the timeframes established by the Tax Code.
Also, in 910.00 declaration form it is necessary to specify income, calculations and rates established for facilitated declaration, and in the second tax form (920.00), it is necessary to specify income and taxes related to the main activity.
At the same time, based on the above example, social payments for the head of household and its members are also indicated in the tax reporting form 920.00, while in case of hiring employees for other types of activities, social payments for employees are indicated in the facilitated declaration form 910.00.