CIT calculation in the RK begins not with mechanically multiplying accounting profit by the tax rate, but with preparing tax accounting data. The accountant must collect information on income and expenses, classify transactions according to their taxation treatment, take into account applicable limitations and adjustments, and then determine the tax liability. Amounts of CIT withheld at the source of payment are checked separately: the tax agent submits a separate calculation for them.
How to Calculate CIT in Kazakhstan
It is convenient to divide the practical preparation of the calculation into several consecutive stages. This procedure helps link source documents, accounting data, and tax reporting indicators.
- Determine the taxpayer's status and type of income. First, establish whether the organization is a resident or non-resident and whether it calculates tax on its own transactions or performs the duties of a tax agent. Income subject to CIT withholding at the source of payment is separated from the overall set of transactions and checked separately.
- Prepare a list of income. For the working reconciliation, use accounting data, contracts, source documents, bank statements, and tax registers. The accountant compares the dates and amounts of transactions and checks that sales and other receipts included in the calculation have been recorded in full.
- Prepare a list of expenses. For each material amount, check the substance of the transaction, how it is recorded in the accounts, the availability of source documents, and the selected recognition period. If a limitation applies to a particular category of expenses, the amount is identified separately in the register so that it is not automatically included in full in the calculation.
- Reconcile accounting and tax data. Accounting indicators are used as the basis for the control reconciliation. Differences between the accounting data and the tax calculation are disclosed in the working register for each transaction, specifying the document, amount, and reason for the adjustment.
- Calculate the tax base and CIT. The working calculation consecutively shows the recognized income, deductible expense amounts, and applicable adjustments. After determining the final indicator, apply the rate prescribed for the relevant taxpayer and type of income as of the date the tax liability arises.
- Determine the final liability. The result is compared with the amounts previously reported in tax returns and payment documents. Advance payments, offsets, and withheld tax are included in the reconciliation only if there are valid grounds and supporting accounting data.
CIT Calculation in the RK: Data to Be Checked
Before preparing the return, it is useful to perform a control reconciliation of the accounting data, tax registers, and source documents. The working file usually includes trial balance reports, breakdowns of income and expenses, contracts, completion certificates, consignment notes, invoices, bank documents, and the registers used to complete the reports.
Particular attention is paid to expenses marked as “Subject to limits” in the accounting system. This attribute should be used as an analytical accounting setting: it helps identify amounts that must be calculated separately, taking into account the limitation prescribed for the specific expense. The name or configuration of a directory item itself does not replace an analysis of the transaction and supporting documents.
For each expense affecting the calculation, the accountant should answer the following questions in sequence:
- which transaction and type of activity the expense relates to;
- which source documents confirm its substance and amount;
- in which reporting period the amount was recorded for accounting and tax purposes;
- whether a limitation applies to this category of expenses;
- whether the same amount has been included in the calculation more than once;
- whether the analytics in the accounting system comply with the adopted tax accounting procedure.
This control is performed before the final registers are generated. If the accountant corrects the type of expense, the period, or the analytics, the registers must be regenerated after the change and compared with the source documents. This makes it possible to see how the correction affected the calculation's final indicators.
CIT at the Source of Payment and Form 101.03
CIT withheld at the source of payment is checked separately from the organization's general tax calculation. The tax agent is responsible for submitting the calculation. The calculation must be submitted no later than the 15th day of the second month following the quarter in which income subject to taxation at the source of payment was paid (Article 356 of the Tax Code of the RK).
When preparing Form 101.03, the accountant enters the indicators in the lines of the current form in accordance with their names and structure. The amounts of income paid and tax withheld must be supported by calculation registers, contracts, bank documents, and accounting entries for the relevant period.
The general information section of the form includes the details required by its current version. They are completed using the tax agent's registration data and the parameters of the calculation being submitted. If the form requires additional information for a particular category of tax agent, it is entered based on registration documents and the data relating to the specific transaction.
Before submitting the calculation, the dates and amounts of actual payments should be compared with contracts and bank documents, and the amounts of CIT withheld should be reconciled with the tax register and payments. The indicators for individual months and the totals for the reporting period are checked arithmetically. At the same time, compliance with the deadline established for submission of the calculation by the tax agent is checked (Article 356 of the Tax Code of the RK).
What to Do After the Preliminary Calculation
After determining CIT, perform a final check based on the “from the source document to the reporting” principle. First, confirm the amounts of income and expenses, then reconcile the tax registers with the accounting data, and finally compare the final indicators with the relevant lines of the current form.
If the organization submits Form 101.02, its details and indicators are completed using the current version of the form and the taxpayer's actual data. When submitting a repeat or supplementary calculation, the accountant selects the type of calculation provided for by the form and specifies only those additional details for which there are corresponding grounds and documents.
Trust management transactions are analyzed separately from the organization's other transactions. The working register records the participants, the substance of the transaction, the terms of the contract, the amounts, and the reporting period. The indicators are transferred to the reports in accordance with the applicable form and the participant's actual obligations documented in the records.
Before submitting the reports, the accountant should check the version of the form, the reporting period, the taxpayer's status, the type of calculation, the arithmetic, and the submission deadline. For Form 101.03, the quarter in which the taxable income was paid is checked separately: Article 356 of the Tax Code of the RK links this quarter to the deadline for the tax agent to submit the calculation.
Frequently Asked Questions
How is CIT calculated in Kazakhstan? — First, data on income and expenses are collected, transactions are classified according to their taxation treatment, and adjustments are recorded in the working register. After the tax base has been determined, the tax is calculated and the result is compared with previously reported amounts and payment documents.
Can CIT be calculated solely on the basis of accounting profit? — The accounting financial result is used for reconciliation, but the final calculation is prepared using tax accounting data. It is advisable to disclose all discrepancies between the accounting indicators and the tax calculation by transaction in a separate register.
Why should an expense be marked as subject to limits in 1C? — This attribute helps identify the expense for a separate calculation in the accounting system. Before applying it, the accountant must determine the expense category, the applicable limitation, and the documents supporting the amount.
What is reported in Form 101.03? — In this form, the tax agent reports the calculation indicators for CIT withheld at the source of payment. The amounts must correspond to actual payments, tax registers, and documents for the relevant reporting period.
When is Form 101.03 submitted? — The tax agent submits the calculation no later than the 15th day of the second month following the quarter in which income subject to taxation at the source of payment was paid (Article 356 of the Tax Code of the RK).