The tax agent calculates IIT on a payment to an individual treated as a non-resident in relation to the specific transaction, taking into account the recipient’s established tax status and the type of income. It is important for the accountant not to confuse tax residency with citizenship or apply a single procedure to all foreign individuals. First, the source data and the basis for the payment are recorded, then the calculation is performed and the withholding is checked, and only after that is the information transferred to the tax return.
Who Is Considered a Non-Resident for IIT Calculation Purposes
Citizenship and tax residency are different characteristics of an individual. Therefore, foreign citizenship alone is insufficient to automatically classify a person as a non-resident of Kazakhstan for accounting purposes. Similarly, holding a passport of a citizen of Kazakhstan does not in itself replace the determination of tax status for the period in which the income was received.
Before calculating IIT, the accountant should collect and verify:
an identity document;
the individual’s IIN, if assigned;
citizenship information;
the information used to establish the tax status for accounting purposes;
if available, a tax residency document and the period specified in it;
an employment contract, a contract for the performance of work, or another document under which the income is accrued;
the nature of the payment and the period for which it was accrued;
documents supporting the application of an international treaty when calculating the tax, if this procedure is used.
The individual’s status should be recorded before the payment is finally calculated. If income was initially accrued under one status and another status was subsequently entered in the accounting system, the calculation for the affected period must be rechecked. A single indicator in the employee record is insufficient: the system data must correspond to the documents and information on which the accounting treatment of the specific payment is based.
It is useful to retain in the working file not only copies of the documents but also information about the date they were received, their validity period, and the period to which they relate. This makes it possible to link the selected calculation procedure to a specific payment and substantiate subsequent recalculations based on the accounting data.
IIT of a Non-Resident of the Republic of Kazakhstan: What to Check When Accruing Income
The work can conveniently be divided into several stages. First, the accountant determines the organization’s role in the specific payment and establishes the nature of its relationship with the individual. The accountant then classifies the income, records the recipient’s tax status used for the calculation, and compares the documents with the payment terms. If provisions of an international treaty are applied in the calculation, the supporting working schedule specifies the documents and circumstances on which the selected procedure is based.
The practical procedure is as follows:
Record the individual’s tax status for the calculation period.
Classify the income according to the contract and accrual document: salary, remuneration under a contract, or another payment.
Determine the IIT calculation and withholding procedure applicable to this type of income.
Verify the set of documents supporting the application of international treaty provisions in the calculation.
Perform the calculation using the parameters applicable to the relevant income and period.
Reconcile the accrued income, calculated and withheld IIT, and the final amount payable.
Transfer the reconciled figures to the tax registers and tax returns for the relevant period.
The country of tax residence, the nature of the income, and the basis for a special calculation procedure cannot be determined solely by an indirect indicator, such as citizenship, the currency of the contract, or the recipient’s bank details. The calculation must use information directly relating to the individual, the payment, and the reporting period.
Corrections require particular attention. If an incorrectly specified status is identified, it is necessary to check not only the current calculation but also previously accrued income, amounts actually withheld, payments to the individual, tax registers, and submitted tax returns. Changing the individual’s record does not in itself correct calculation documents that have already been posted.
If an error affects several periods or several types of accruals, it is convenient to document the recalculation sequentially for each period and each payment. This approach helps prevent a situation in which the final amount has been corrected but the breakdown for the individual and the tax return figures remain unchanged.
IIT in Kazakhstan on a Non-Resident’s Income: Form 200.02
When preparing Form 200.02, the accountant uses the version of the form and the completion rules applicable to the relevant reporting period. The information in the appendix must be reconciled with the tax registers, accrual documents, and the individual’s identification details. Specific lines and columns are completed in accordance with the current rules for the form, rather than by transferring figures from the calculation for another person or another type of payment.
Before completing the appendix, it is advisable to prepare a separate working breakdown for each individual. It may specify the accrual period, type of income, amount accrued, IIT calculation result, withholding information, and details of the documents used to determine the tax status. Such a breakdown helps verify that the tax return is consistent with the accounting data.
When completing identification details, the accountant transfers only the data required by the relevant lines and columns of the current form. For internal reconciliation, the following are checked separately:
surname, first name, and patronymic, if any;
IIN, if assigned and required to be specified;
citizenship, if the relevant indicator is included in the form;
tax residency, if the relevant indicator is included in the form;
foreign tax identification number, if it is included in the documents and required to be specified;
whether the personal data in all accounting registers relate to the same individual.
Citizenship and tax residency should not automatically be regarded as identical. If the current version of the form includes both indicators, each is completed separately using the information relevant to it. The country code is selected according to the classifier prescribed by the completion rules for the relevant version of the tax return.
Before submitting the tax return, the information in Form 200.02 must be compared with the contracts, calculation documents, and tax accounting registers. Personal data are transferred without arbitrary abbreviations or character substitutions. The IIN, foreign tax identification number, and country codes, when they are reportable, are checked separately for each person, since an error in an identifier may cause the information to be linked incorrectly.
The totals in the appendix should be reconciled not only with the total amount of accruals but also with the individual breakdowns. If a recalculation has been posted in the accounting records, the accountant checks the period and document in which it was recorded and then reconciles the tax return figures with it. This is particularly important when the individual’s status or type of income was changed after the initial accrual.
IIT on the Income of Foreigners and Stateless Persons: Form 200.02
Form 200.02 is an appendix to the individual income tax and social tax return (Form 200.00). It is used by the tax agent to report income of foreigners and stateless persons specified by the rules and to calculate IIT on the relevant income.
Before completing the appendix, the accountant must determine the individual’s tax status, the type and source of income, the applicable taxation procedure, and whether there are grounds for applying an international treaty. Not all payments to foreign citizens are automatically reported in Form 200.02: the exceptions prescribed by the current rules must be taken into account.
The figures in the appendix should be reconciled with contracts, accrual documents, the IIT calculation, tax accounting registers, and the amounts actually withheld. Personal information is completed in accordance with the current version of the form and its completion rules.
Before submitting the tax return, it is necessary to check the current version of Form 200.00 and Appendix 200.02 for the relevant tax period.
Frequently Asked Questions
Is a foreign citizen always a non-resident of the Republic of Kazakhstan? — No. Citizenship and tax residency are different characteristics. The calculation uses the status established for the individual and the period in which the income was received, based on the information relating to them.
Can a non-resident’s IIT be calculated solely on the basis of the indicator in the 1C record? — No. The indicator in the record is used for automated calculation, but the accountant must also compare it with the documents, type of income, validity period of the information, and the resulting calculation.
How should information for Form 200.02 be prepared? — First, prepare an individual breakdown for the person, reconcile it with the accrual, IIT calculation and withholding, and the tax registers, and then complete the prescribed fields in accordance with the form and the rules applicable to the reporting period.
How should a non-resident’s full name be specified in Form 200.02? — If the current version of the form requires the relevant identification details, the surname, first name, and patronymic, if any, are transferred from the identity document without arbitrary abbreviations.
Must the same country be specified for citizenship and tax residency? — No, this information cannot be treated as identical automatically. If both indicators are included in the form, each is completed separately based on the data relevant to it.
What should be done if a non-resident’s IIT was calculated incorrectly? — Check the individual’s documents, established tax status, type of accrual, validity period of the information, and the document posting sequence. After making the correction, perform a recalculation, compare it with the registers and the amount payable, and then bring the affected tax returns into line.