Special patent based tax regime Printable versionLast update: 07.06.2021
Which individual entrepreneur can work under a patent
The main condition for the use of a special "IE under a patent" regime is the conduct of individual entrepreneurship, i.e. the lack of employees hired by the entrepreneur.Other conditions for the patent use and the existing restrictions are enshrined in Article 683 of the Tax Code of the Republic of Kazakhstan.
So, there is a restriction:
- by the amount of income (up to 3,528 MCI per year or 10,291,176 tenge for 2021);
- by the activity type (taking into account the requirements of subparagraph 3 of paragraph 2 of Article 683 of the Tax Code of the Republic of Kazakhstan and other restrictions).
In the event that the annual income exceeds the established threshold, the individual entrepreneur loses the right to apply the patent and is obliged to switch either to another special tax regime, to a “simplified tax regime” or to a generally established regime.
Individual entrepreneurs who carry out the following activities can work under the patent (there are 32 of them in total):
- plastering work;
- joinery and carpentry work;
- flooring and wall cladding works;
- painting and glass work;
- taxi activities;
- automobile truck transportation;
- property management on a fee or contract basis;
- activities in the field of photography;
- translation (oral and written) business;
- property lease (rent);
- rental of vehicles;
- rental and rental of entertainment and sports equipment;
- rental of videos and disks;
- rental and lease of other personal and household goods;
- leasing of agricultural machinery and equipment;
- leasing of office machinery and equipment, including computers;
- services in the field of sports education and education of specialists in the organization of leisure;
- cultural education services;
- services in the field of other education;
- auxiliary educational services;
- activities in the field of art;
- repair of computers and peripheral equipment;
- repair of communication equipment;
- repair of personal and household goods;
- hairdressing services;
- manicure and pedicure;
- veterinary services;
- services for the processing of land plots;
- cleaning services for living premises and housekeeping;
- services of porters in the markets, train stations;
- production and repair of musical instruments;
- grazing of domestic animals.
Trade under a patent is prohibited. If the conduct of activities not included in this list is revealed, then a notification will be issued and the taxpayer must switch from the patent regime to the generally established regime.
All entrepreneurs applying special patent based tax regime are obliged to apply the control - cash machines.
A special patent based tax regime is not applicable to be used by the IEs providing agency contract (agreement) based services.
How to get a patent and for how long it is issued
To obtain a patent, an entrepreneur must first register as an individual entrepreneur.
To apply a special patent based tax regime, a patent cost calculation (calculation) is submitted to the tax authority at the location .
The calculation is submitted on paper or in electronic form, including through the web portal "electronic government", by the individual entrepreneur:
- Who is a newly formed, no later than 3 working days from the date of submission of the notification for registration as an individual entrepreneur.
- Those carrying out the transition from the generally established procedure or other special tax regime before the 1st day of the month of applying the special patent based tax regime.
- To obtain the next patent, - before the expiration of the previous patent or the period for the suspension of tax reporting.
The calculation is a tax report for calculating the patent cost.
The amount of income that is planned to be received during the patent effective period is determined by the taxpayer himself.
The payment of the patent cost is made by the taxpayer prior to the submission of the calculation.
In the case of payment of the patent cost through the second-tier banks or organizations that carry out certain types of banking operations, the payment submitted in electronic form is accompanied by a notification of the payment gateway "electronic government" generated on the web portal of "electronic government" when specifying the payment document details in the request.
Simultaneously with the settlement on paper, documents are submitted confirming the payment of the patent cost.
In the calculation submitted in electronic form, including through the web portal "electronic government", individual entrepreneurs indicate the details of payment documents for the payment of taxes and social payments included in the patent cost.
The value of the patent includes the amounts payable of personal income tax (other than withholding individual income tax) and social security payments.
The calculation of the amount of individual income tax included in the patent cost is made by applying a rate of 1 percent to the taxable item.
IT IS IMPORTANT: as per the Law of the Republic of Kazakhstan No. 290-VI of December 27, 2019, from 01.01.2020 to 01.01.2023, the amount of IIT for the micro and small businesses is reduced at 100% of the tax subject to the conditions of Article 57-4 of the Law on the Introduction. So that the IIT for this period should not be paid (the patent cost is equal only to the amount of social payments).
Accordingly, when providing the form ф. 911.00 for 2021, the amount of the planned income is indicated in the calculation, and the amount of IIT to be accrued is 0 tenge.
In addition, from 01.01.2020 to 01.01.2022, the following applies, subject to the conditions of Article 57-4 of the Law on the Introduction.
The amount of calculated individual income tax is subject to downward adjustment for the purchase of a three-component integrated system in the amount of 60,000 tenge, but not more than the 50 percent of the calculated tax amount.
The tax reduction is made as a whole for the entire tax period at a time when calculating the amount of individual income tax in the last patent cost calculation for the tax period in which such a three-component integrated system is established, as well as for the tax period following the tax period of such acquisition.
The calculation of social payments included in the patent cost is made in accordance with the laws of the Republic of Kazakhstan:
- On pension provision in the Republic of Kazakhstan,
- On compulsory social insurance,
- On compulsory social health insurance.
After submission of the calculation, the tax authority forms a patent in the information system of the tax authority within 1 business day following the date of submission of the calculation.The tax period for the application of a patent is a calendar year.However, an entrepreneur can “buy out” a patent for any period, in the range from one full calendar month to one year.For example, an individual entrepreneur was registered from October 15 to November 15, the next patent should be from November 15 to December 31.
Exception: if the IE is registered on December 15, then he may take for 15 days, i.e. until the 31 December.
This must be done before starting a business.
- If, after the patent expiration date, the entrepreneur plans to continue the activity, then the next patent must be acquired before the expiration of the previous one.
- If an individual entrepreneur plans to change the tax regime, then a notification of the change should be submitted before the month in which the transition is planned. Otherwise, a notification will be issued and transferred to the generally established taxation procedure.
- If the activity is planned to be suspended, the application for suspension must also be submitted before the expiration date of the current patent.
- If the entrepreneur simply "abandons" the patent at the end of the validity period, but does not file an application for suspension of his activities, then a notification will also be issued and the taxpayer must switch from the patent regime to the generally established regime.
- If his income exceeds the specified amount, then he is obliged to provide an additional calculation for the difference and pay additional taxes.
- If the income exceeds the established limit, then he must provide a notification of the transition to another tax regime, due to the discrepancy from the 1st day of the month in which such an excess has occurred.
Those who have not submitted within 60 calendar days from the date of expiration of the patent, have the right to close it in accordance with Article 67 of the Tax Code.