We would like to acquaint you with the new requirements of government revenue agencies (hereinafter "GRA") implemented to control revenues from foreign sources in the framework of the Law of the Republic of Kazakhstan "On amendments and additions to some legislative acts of the Republic of Kazakhstan on payments and payment systems” number 12-VІ ЗРК of July 26, 2016 (hereinafter - the "Law"). This law came into force on October 10, 2016.
The new requirements of the Law
Individuals and legal entities upon receipt of money and other property from foreign states, foreign organizations, foreigners, and stateless persons (hereinafter - "foreign sources") shall be obliged:
- To provide notification to GRA about the transaction within 10 days of the transaction. Be sure to provide data regarding future funds and property to be received from foreign sources
- To provide GRA with information regarding receipt and expenditure of funds and other property obtained from foreign sources, in the order, timing and form established by the authorized body
Furthermore, information and materials that is published and distributed by individuals at the expense of foreign sources must contain:
- Information about the persons who made the order
- Information on the manufacture, distribution and disposal of information and material
Additionally, the authorities plan to develop tax registers to reflect the information on funds and other properties obtained from foreign sources, as well as how these funds and other properties were spent.
Individuals and legal entities shall submit information about the receipt and expenditure of funds and other properties obtained from foreign sources to the GRA not later than the 15th day of the second month following the reporting quarter.
Currently, 4 normative legal acts are being developed which will regulate the form, timing and notification of information to the tax authorities regarding the receipt of funds or other property, as well as the procedure for maintenance of the aforementioned tax registers.
Who is affected by the new requirements
The new requirements apply under the following conditions simultaneously:
- The operation is carried out with a foreign entity, exceeding 10 monthly calculation indices (hereinafter - "MCI")
- The activities of the recipient of funds and other property are aimed at:
· Legal assistance, including offering legal information and advice to, and protection and representation of the interests of, citizens and organizations
· Studying and conducting public opinion polls (except for public opinion polls and surveys conducted for commercial purposes), as well as distribution and publication of their results
· Collecting, analyzing and disseminating information, except when the indicated activity is carried out for commercial purposes
Also, the law prescribes the range of persons to whom these obligations do not apply.
GRA also undertakes to maintain a database on the abovementioned persons and the received information.
Violation of the aforementioned requirements is an administrative offence.
- Failure to report or the untimely reporting of the receipt of funds and other property from foreign sources results in the following fines:
· For individuals - 50 MCI
· For small and non-profit organizations - 100 MCI
· For medium-sized companies - 200 MCI
· For large enterprises - 350 MCI
- The submission of incorrect or false information results in the following fines:
· For individuals - 100 MCI
· For small and non-profit organizations - 200 MCI
· For medium-sized companies - 400 MCI
· For large enterprises - 700 MCI
- Repeated violations of the aforementioned results in the following fines:
· For individuals - 150 MCI
· For small and non-profit organizations - 250 MCI
· For medium-sized companies - 450 MCI
· For large enterprises - 1,000 MCI with prohibition of activity
- For violation of the rules surrounding the publishing of materials results in:
· A warning
· If the violation is repeated within the space of one year – fines of 25 MCI
In case of additional questions, SCHNEIDER GROUP will be happy to assist you.
Senior Tax Expert
Tel. + 7 (727) 355 44 48
 2121 Tenge in 2016