Page 31 - CEE Tax Guide 2024

Kyrgyzstan VAT options in Applicable / limits Personal income tax / Social security system
Kyrgyzstan
The following are recognized as tax residents: citizens
of the Kyrgyz Republic and any individual remaining in the
Distance selling No
Kyrgyz Republic for at least 183 calendar days in any
Call-off stock No consecutive 12-month period ending in the current tax
Mazars LLC VAT group registration No period (calendar year).
118 Moskovskaya st., 5 floor, All types of income are taxed at a rate of 10% regardless
th
Business center Olymp Cash accounting – yearly Available without limits. of the tax residency status of the individual and the type
amount in EUR (approx.)
Bishkek, Kyrgyzstan of incomes received.
Phone: +996 312 882 155 Import VAT deferment No
E-mail: infoca@mazars.kz Local reverse charge ü The following social contributions are withheld from

Option for taxation employee income: 8% to the Pension Fund, 2% to the State
Pension Fund. The following social contributions are paid
letting of real estate No by an employer on employee income: 15% to the Pension
Fund, 2% to the Compulsory Health Insurance Fund, and
supply of used real estate No
Corporate taxes and other direct taxes Transfer pricing in Kyrgyzstan VAT registration 0.25% to the Employee Health Improvement Fund.

Taxable income is calculated as annual income minus Arm's length principle ü Since 2009 threshold No
expenses. Only properly documented expenses may
be deducted, provided that expenses are related to the Documentation is not
taxable income. Dividends and capital gains are excluded Documentation liability No required, but benchmarking
must be provided at the tax
from taxable income. The percentage of depreciation authority’s request.
norms for fixed assets is set out in the Tax Code and
is substantively similar to IFRS principles. Losses can APA No –
be carries forward within the following 5 calendar years Country-by-Country
inclusively; the rule on carrying forward losses does not liability No –
apply to losses generated during periods when a company
enjoyed tax benefits. There are no thin capitalization rules. Master file-local file
(OECD BEPS 13)
WHT is applied to incomes paid to non-residents that are applicable – –
not registered for tax purposes in Kyrgyzstan. Taxable Penalty
incomes are listed in the Tax Code. Kyrgyzstan has signed
32 treaties on the avoidance of double taxation. Though lack of documentation No – Average wage
the treaty rates prevail over the Tax Code, it is important penalty. Wage related taxes in Kyrgyzstan Minimum wage in private sector
to have a duly issued tax residency certificate for the non- tax shortage From 10% to 100% of the
resident to apply the treaty. The multilateral instrument ü tax shortage. Exchange rate KGS/EUR 97 in EUR in KGS in EUR in KGS
(MLI) is not in force. 191 18,500 464 45,000
Interdependent entities
VAT and other indirect taxes are entities whose relations Total wage cost 224 117.25% 544 117.25%
may affect the conditions
The VAT concept is quite similar to the concept applied or economic results of their Employer's social security and other contributions 33 17.25% 80 17.25%
in developed countries worldwide. Turnover subject to VAT activities or those of the entities Gross salary 191 100.00% 464 100.00%
is in general the total value of sales (Output VAT). VAT paid they represent, namely: Personal income tax 19 10.00% 46 10.00%
1) An entity has a direct
to suppliers (input VAT) is deducted from Output VAT. or indirect participation Employees' contributions 17 9.00% 42 9.00%
Input VAT cannot be offset if the goods, works, or services in another entity and the
aggregate share of such
purchased are not related to the taxable turnover, participation is more than 20%; Net salary 154 81.00% 376 81.00%
the VAT-invoice is not issued by a supplier or is issued 2) Two entities in which a third
in violation of legal requirements, the supplier is declared entity holds participation
and its direct and/or indirect
by court as inactive entity, etc. The VAT rate for the export Related parties interest in each entity is more
of goods is 0% and there is a procedure for refund of the than 20%, or is controlled
related input VAT. A special VAT procedure applies to the by such an entity;
3) When one natural
export/import of goods to/from the countries belonging person is subordinate
to the Eurasian Economic Union such as Russia, Belarus, to another natural person
Kazakhstan, and Armenia. in an official capacity;
4) Entities between which
Sales tax applies to revenue besides VAT. The rate varies there are relations regulated
from 0% to 5% depending on the type of activity and by the labor legislation of the
Kyrgyz Republic;
whether the revenue was received in cash or not. 5) Close relatives;
6) The founder of the
Excise tax is paid by importers and sellers of: management and the trustee.
Ludmila Dyakonova
1) Alcoholic products
Safe harbors ü 20% Partner
2) Tobacco products Phone: +7 727 355 40 00
Level of attention paid by Tax
3) Oil products. Authority 8/10 E-mail: ludmila.dyakonova@mazars.kz

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