What VAT Is and What Its Essence Is
The essence of VAT is the taxation of the value added at each stage in the movement of goods, work, or services. The seller charges VAT to the buyer, accounts for tax on its transactions, and compares it with the VAT attributable to purchases. Therefore, what matters to an accountant is not only the amount of tax in a particular document, but also the entire chain: the nature of the transaction, the tax base, the rate, source documents, and the recording of data in the accounts.
Economically, the tax is included in settlements between participants in the turnover, while the final burden generally remains in the price paid by the end consumer. An organization or individual entrepreneur participating in VAT settlements performs an accounting function: it prepares documents, records transactions, and determines the final tax liability under the rules applicable in Kazakhstan.
VAT should not be viewed as a simple percentage of all revenue. The final amount depends on the transactions performed by the taxpayer, whether they give rise to taxable turnover, whether there are grounds for recognizing tax on purchases as input VAT, and whether amounts must be allocated between different types of activity. In 2026, the VAT rate is 16%. VAT recognized as input VAT is allowed for goods, work, and services received, provided that the established conditions are met and they are used or intended to be used for taxable sales turnover (Art. 480 of the Tax Code of the RK). Under separate accounting, the allocation base is determined using the amount of taxable turnover and the total amount of taxable and non-taxable turnover for the tax period (Art. 489 of the Tax Code of the RK).
How VAT Is Recorded in the Accounts
VAT accounting can conveniently be viewed as a sequence of related actions:
- determine the participant's tax status and the nature of the transaction;
- determine whether the sale or purchase is classified as a transaction included in the VAT calculation;
- verify the tax base and the applicable calculation procedure;
- reconcile the data in the contract, source documents, and accounting system;
- process adjustments, returns, and tax agent transactions separately;
- check whether VAT must be allocated between different types of turnover;
- substantiate the final figures with documents and accounting registers.
For an accountant, the connection between a business transaction and its documentary recording is essential. Even if the final amount appears plausible, an error in the transaction type, rate, or field may produce an incorrect result or prevent the document from being posted in 1C.
Situations in which purchases relate to several areas of activity at the same time require particular attention. In such cases, all input VAT cannot automatically be attributed to one type of turnover: when goods, work, or services are used simultaneously for taxable and non-taxable turnover, the VAT amount is allocated between the portion allowed and the portion not allowed as input VAT (Art. 489 of the Tax Code of the RK). The accounting system requires a completed base for the calculation. If the grounds for the calculation have not been recorded, the software will be unable to perform the transaction correctly.
When maintaining separate accounting, the payer separately accounts for VAT on goods, work, and services received that are used for taxable and non-taxable turnover. The amount relating to purchases used for taxable turnover is allowed as input VAT subject to adjustment, while the amount relating to purchases for non-taxable turnover is not allowed as input VAT. For purchases used simultaneously in both types of turnover, allocation is applied based on taxable and total turnover for the tax period (Art. 489 of the Tax Code of the RK). VAT for a tax period must be paid no later than the 25th day of the second month following the reporting tax period, except in separately prescribed cases (Art. 506 of the Tax Code of the RK).
What an Accountant Should Check in 1C
If 1C displays: “The VAT allocation base has not been determined. Allocation cannot be performed,” the “VAT Allocation” document and the figures used to form the allocation base should be checked. The message appears when allocation is required but the revenue figures used by the system for different categories of transactions have not been completed.
The practical review procedure may be as follows:
- Ensure that sales documents for the period under review have been recorded in the accounts.
- Check the transaction type and VAT accounting settings in the source documents.
- Reconcile accounting revenue with the source documents and registers.
- Check why the system determined that allocation was necessary.
- Generate the document again after correcting the source data.
An arbitrary amount should not be entered merely to bypass the validation. First, it is necessary to determine which business event is missing or has been recorded incorrectly.
Another possible situation concerns a tax adjustment. If the selected rate is anything other than “VAT is calculated by the tax agent,” the tax amount after adjustment cannot equal zero. The validation is triggered if the tax amount has not been completed and the transaction is not a return.
In this case, the following should be checked:
- the selected rate or special calculation option;
- whether the tax amount after adjustment has been completed;
- the return indicator;
- the details of the original and adjustment documents;
- whether the adjustment corresponds to the actual transaction.
The software message indicates an inconsistency between the fields, but does not itself determine the correct tax result. The correction must be based on the contract, source documents, and applicable rules, rather than solely on the need to post the document.
Practical Procedure Before Reporting
Before preparing reports, it is useful to perform an end-to-end VAT review. Begin by checking the completeness of the source documents: sales, purchases, returns, and adjustments. The tax details of counterparties should then be checked and the documents reconciled with one another.
After this, the accountant should separate the transactions according to their tax treatment. If certain purchases relate simultaneously to taxable and non-taxable turnover, it is necessary to ensure that 1C contains the data required to allocate VAT under the separate accounting rules (Art. 489 of the Tax Code of the RK). Zero or incomplete figures require analysis: they may indicate either the absence of the relevant turnover or an error in the underlying accounting records.
Reviewing adjustments is a separate stage. The tax amount, rate, and return indicator must form a logically consistent data set. If the system issues a warning, the root cause should first be identified in the source document or field, after which the calculation should be repeated.
The review should be completed by reconciling the accounting data with the documents and the requirements of Kazakhstan's legislation. For 2026 reporting, the VAT calculation uses a rate of 16%, and, as a general rule, the VAT amount for the tax period must be paid no later than the 25th day of the second month following the reporting tax period (Art. 506 of the Tax Code of the RK). When allocating VAT, the taxable and total turnover figures for the relevant tax period must be used (Art. 489 of the Tax Code of the RK).
Frequently Asked Questions
Is VAT a tax on all revenue? — Its essence relates to value added; however, the accounting calculation is based on the rules for accounting for specific transactions, output tax, and amounts relating to purchases that are allowed as input VAT.
Why does 1C not perform VAT allocation? — One reason is that allocation is required while the base has not been completed. The taxable and total turnover figures, as well as the source documents from which they are generated, should be checked. Purchases used simultaneously for taxable and non-taxable turnover are allocated under the separate accounting rules (Art. 489 of the Tax Code of the RK).
Can an amount be entered manually so that the document is posted? — Entering an arbitrary amount is risky. The amount must be supported by the substance of the transaction, source documents, and the applicable tax treatment.
What should be checked if the VAT amount after adjustment is zero? — Check the rate, tax amount, return indicator, and tax agent calculation option, as well as the link to the original document.
What rate and payment deadline apply in 2026? — The VAT rate is 16%. As a general rule, tax for a tax period must be paid no later than the 25th day of the second month following the reporting tax period (Art. 506 of the Tax Code of the RK). Separate deadlines are established for VAT on imported goods and VAT under a liquidation tax return.