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What contributions generate the pension fund foundation Printable version

Last update: 10.09.2021

The monthly payroll deductions are contributions to the pension fund.

The pension contributions and the investment income accrued thereon form overall financial cushion from which the pension payments are done.

There are 3 types of pension contributions:

  • mandatory pension contributions;
  • mandatory professional pension contributions;
  • voluntary pension contributions.

In the material we will tell more about the above pension contributions.

Mandatory Pension Contributions (MPC)

Mandatory pension contributions are done by legal entities and individuals; private and individual entrepreneurs; small business entities; peasant and farm enterprises; those who work outside the country, while remaining the citizens.

Mandatory pension contributions (MPC) payable to the UAPF are set at the rate of 10 % of the monthly income accepted for calculating MPC, but not less than 10% of the minimum wage established for the corresponding financial year by the law on the Republican budget, and not more than 10% of the 50-fold minimum wage.

The Payers

The tax Period

The calculation base

The limits

the deadline for paying the MPC

Notes

Legal entities that use the labor of employees and individuals with whom civil law contracts concluded

Each month of the tax period

monthly income of employee and individual

10% of the monthly income and not more than 10% of the amount equal to the 50 multiplied by the minimum salary3

no later than the 25th day of the month following the month of the income paid out

It is an obligation to pay the MPC

Private and individual entrepreneurs that transfer the MPC for themselves

Each month of the tax period

income determined by the entrepreneur himself

in the amount of 10% of the income received, but not less than 10% of the minimum salary and not more than 10% of the 50-multiplied by the minimum salary amount

no later than the 25th day of the month following the month of income received

Obligation to pay MPC

In the absence of any income received, there is still a right to pay MPC at the rate of 10 percent of the minimum salary amount

Private and individual entrepreneurs that employ the workers

Each month of the tax period

Monthly income of employees 

in the amount of 10% of the income received, but not less than 10% of the minimum salary and not more than 10% of the 50-fold minimum salary amount

no later than the 25th day of the month following the month of the income paid out

Eligible to pay MPC

 

Small businesses applying a special tax regime based on filing a simplified declaration, and transferring MPC for themselves, and employing the labor of hired workers

semiannually

Income received/

Monthly income of hired workers and natural persons

in the amount of 10% of the income received, but not less than 10% of the minimum salary and not more than 10% of the amount equal to the 6 times the 50-multiplied by the minimum salary

within the time frame provided for by the tax legislation of the Republic of Kazakhstan: no later than the 25th day of the second month following the reporting tax period

Obligation to pay MPC A simplified declaration (form 910.00) is submitted to the tax authority no later than the 15th day of the second month following the reporting tax period.

Individual entrepreneurs applying a special tax regime based on a patent

Calendar year

income received for the tax period

in the amount of 10% of the income received, but not less than 10% of the minimum salary and not more than 10% of the amount equal to the 12 times the 50-multiplied by the minimum salary

within the period stipulated by the tax legislation of the Republic of Kazakhstan: the patent is paid before the submission of the patent cost calculation statement

Obligation to pay the MPC

 

The patent cost calculation statement  (Form 911.00) is submitted to the tax authority within the time limits provided for by the tax legislation

Peasant or farm households paying for the adult member (being a participant of the peasant or farm household) and for the head of the peasant or farm household

For each month of the tax period

Monthly income

not less than 10% of the minimum salary amount and not more than 10% of the 50-multiplied by the minimum salary

in the manner and terms provided for by the tax legislation of the Republic of Kazakhstan

Obligation to pay the MPC

 

The MPC for the adult members (participants) of the peasant or farm household is subject to calculation and payment in the beginning of the calendar year following the year the minor members (participants) reach the age of majority.

 

The declaration (form 920.00) is submitted to the tax authority no later than the date of March 31 of the tax period following the reporting tax period

Individuals who receive income under the civil law contracts, the subject of the contract is the work performance (services provision) and it is concluded with an individual who is not a tax agent under the tax code of the RK4

For each month of the tax period

Income received

in the amount of 10% of the income received, but not more than 10% of the 50-multiplied by the minimum salary

 

For the period from June 1, 2020 to January 1, 20215, there are limits in the amount of 5% of the income received, but not more than 5% of the 50-multiplied by the minimum salary

no later than the 25th day of the month following the month of the income received

Eligible to pay the MPC

Citizens of the Republic of Kazakhstan working in the representative offices of international organizations in the Republic of Kazakhstan, diplomatic missions and consular offices of foreign states accredited in the Republic of Kazakhstan

For each month of the tax period

Income received

in the amount of 10% of the income received, but not more than 10% of the 50-multiplied by the minimum salary

Eligible to pay the MPC

RK citizens working outside the RK

For each month of the tax period

Income received

in the amount of 10% of the income received, but not more than 10% of the 50-multiplied by the minimum salary

 

Eligible to pay the MPC

Individuals who work under employment contract as well as receive income under civil law contracts are exempt from paying the MPC, the subject of the contract is the work performance (services provision) and they are concluded with the individuals who are not tax agents under the tax law.

The transfer of the MPC is made by the tax agents by non-cash payments.

Individuals of private entrepreneurship, and individual entrepreneurs, as well as individuals who receive income under the civil law contracts, who do not have accounts in the banks and organizations engaged in certain types of banking operations (hereinafter, the banks), pay in cash the MPC at the banks for subsequent transfer to the SAPF, indicating the following State Corporation details:

Beneficiary

NJSC «State Corporation «Government for citizens»

 Beneficiary bank

NJSC «State Corporation «Government for citizens»

Beneficiary BIC

GCVPKZ2A

Beneficiary IIC

KZ12009NPS0413609816

Beneficiary BIN

160440007161

PDC (Payment designation code)

010

Mandatory Professional Pension Contributions (MPPC)

To protect and compensate for the damage to the health of the people working in the hazardous industries, the state has provided, among other things, such a mechanism as the MPPC.

The employer is a contributor of the MPPC. It is the employer who transfers the MPPC for the employees.

Those citizens who work in the professions, the list of which is approved by the Decree of the Government of the Republic of Kazakhstan, are entitled to receive the pension savings in the form of MPPC.

The MPPC are established at the rate of 5% of the employee's monthly income, established for calculating the pension contributions in the manner determined by the Government of the Republic of Kazakhstan.

The SAPF had issued a pension provision agreement based on the MPPC (the accession agreement).

The accession agreement is concluded on the basis of submitted application for opening an individual pension account (IPA). The application is signed by three agreement parties: the SAPF, the contributor (employer) and the recipient (employee), for whom the MPPC will be paid.

The following are exempt from paying the MPPC:

  • persons who have reached the retirement age, in accordance with the Law of the Republic of Kazakhstan "On the Pension Provision in the Republic of Kazakhstan";
  • persons with the first and second group disabilities provided that disability is established for an indefinite manner;
  • military personnel, employees of special state and law enforcement agencies who have been assigned the special titles, class ranks, as well as persons whose rights to have the special ranks, class ranks and wear the uniform have been terminated on the January 1, 2012.

The MPPC is paid in the national currency of the Republic of Kazakhstan not later than the 25th day of the month following the month of the income received. The business entities applying a special tax regime have to pay the MPPC in the manner and terms provided for by the tax legislation of the Republic of Kazakhstan.

The tax authorities control the transfer of the MPPC. If the employer does not transfer the MPPC to the employee's IPA in a timely manner (subject to the actual payment and receipt of the income by the employee), the tax authorities shall charge to pay the employer the MPPC along with the interest accrued in the amount of 2.5 times the official refinancing rate established by authorized body for the each day of the payment delay (including the day the payment is proceeded) and the amount will be transferred to the SAPF.

In cases of incomplete and (or) untimely transfer of the MPPC, the tax authorities have the right to collect the money from the employer’s bank accounts within the limits of the debt. The debt is collected on the basis of a notification sent to the employer in the manner established by the Government of the Republic of Kazakhstan.

The employer within 5 working days from the date of receipt of the notification, is obliged to submit a list of the MPPC recipients to the tax authority.

More details can be found on the website Еnpf.kz.

Voluntary pension contributions (VPC)

The citizens pay voluntary pension contributions on their own initiative, in any amount and within any frequency.

The voluntary pension contributions to the SAPF and (or) to the voluntary accumulation pension fund (VAPF) are made by the contributors:

  • who are individuals for their own benefit from their income;
  • who are individuals and legal entities for the benefit of the recipient (third party).

The contributor of the voluntary pension contributions is entitled to choose either the SAPF and (or) VAPF to pay for the voluntary pension contributions.

The rate of voluntary pension contributions and the procedure for their payment are determined by the contributor (recipient) himself. The individual who is the resident of the Republic of Kazakhstan is entitled to the tax deduction for the amount of voluntary pension contributions paid for his own. The deduction is applied in the tax period in which the date of payment of voluntary pension contributions falls.

A supporting document for the tax deduction on voluntary pension contributions is an agreement on pension provision at the expense of voluntary pension contributions (hereinafter, the agreement). The agreement is signed in person upon a visit of the contributor (recipient) to the SAPF, and the contributor and the recipient (if the agreement is signed for the benefit of the third party) or a legal representative or a trustee of the minor based on the power of attorney visit in person the SAPF to sign the agreement.

The agreement is signed at the office of SAPF in person by the contributor and (or) the recipient / trustee / legal representative.

In the event the individual (recipient) has an individual pension account that he opened in the past (hereinafter, IPA) for accumulating the voluntary pension contributions (subject to the change of the contributor under the agreement), the re-opening of the IPA for the voluntary pension contributions is not provided, though a new agreement will have be signed with the same IPA and agreement No. that were opened before, stating the current date on the new agreement signed.

The transfer of the VPC is made according to the following bank details:

Beneficiary

«NJSC «State Corporation «Government for citizens»

Beneficiary bank

RSE «National bank of the Republic of Kazakhstan»

Beneficiary BIC

NBPFKZKX

Beneficiary IIC

KZ50147KZT4368609316

Beneficiary IIN

971240002115

PDC (Payment designation code)

013

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