Issues Related to Universal Declaration
Who is required to submit a declaration of assets and liabilities in 2024 as part of the third stage?
From January 1, 2024, directors and founders (participants) of legal entities, individual entrepreneurs, and their spouses are required to submit a declaration.
This requirement also applies to inactive and those who have suspended their activities.
Since, according to the norms of the Civil Code, branches and representative offices are not legal entities, the leaders of branches and representative offices are not obligated to submit a declaration in 2024 (paragraph 3 of article 43 of the Civil Code).
Also, in 2024, individuals engaged in private practice are not required to submit a declaration of assets and liabilities.
What information must be included in the declaration?
The universal declaration system involves all citizens providing a declaration of assets and liabilities, which reflects all foreign assets, movable and immovable property of the individual, such as:
Subsequently, a declaration of income and property (form 270.00) must be submitted annually, reflecting the income received during the calendar year, information about the acquisition or disposal of property both in Kazakhstan and abroad, as well as sources of funds used for their acquisition.
Thus, the declaration of income and property reflects:
Methods and deadlines for submitting the declaration?
The declaration must be submitted by September 15, 2024, at the place of residence. The declaration can be submitted through the web portals: «Taxpayer's Cabinet», «eGov», mobile applications «e-salyq Azamat», Halyk, Bank Centercredit. Citizens also have the right to submit the declaration on paper by mail or in person.
How to prepare for filing the declaration?
It is necessary to declare assets located abroad and in Kazakhstan as accurately as possible. In the future, the value of the assets will be considered when determining taxable income.
Therefore, before filling out the declaration, we recommend to take next steps:
Declaration of an Individual's Debt
One of the conditions for filling out the «initial» declaration of assets and liabilities is the reflection of debts and claims existing on December 31, 2023.
This means that citizens must reflect in the declaration their debts to other individuals or legal entities. Debts that are to be returned to this individual by others are also reflected.
According to the Tax Code, loan agreements must be notarially certified (part 2 of article 631 of the Tax Code).
Notarial certification of contracts will ensure an accurate reflection of the size of the debt and obligations of the individual.
The procedure for certifying contracts is regulated by Chapter 8 of the Law of the Republic of Kazakhstan «On Notaries», and the deadlines for notarial acts are determined by Article 40 (on the day of submission of all necessary documents and payment of the state duty).
Thus, contracts and other documents must be notarially certified before submitting the initial declaration (submission deadline is September 15, 2024). The Republican Chamber of Notaries has confirmed the right of individuals to certify the specified contracts (concluded before December 31, 2023) in the period until September 15, 2024.
Please note that debts and obligations can only be reflected in the initial declaration; additions will not be accepted (subparagraph 7 of paragraph 5 of article 211 of the Tax Code).
Bank loan agreements are not to be reflected in the declaration.
However, other contracts concluded with legal entities (including microfinance organizations) must be reflected in the declaration.
For all questions related to the procedure for certifying loan agreements, it is necessary to contact regional chambers of notaries for consultation (addresses of notary chambers are posted on the website www.notariat.kz).
Cash Declaration
Universal declaration is intended to ensure fair taxation of citizens based on their income size. Identifying individuals evading tax payments will help reduce the level of the shadow economy.
One of the effective methods of reducing shadow turnovers is the transition to non-cash payments, which have become an integral part of the lives of our citizens.
The share of non-cash payments for the first 9 months in Kazakhstan has increased to 86% (last year - 82%), according to the Association of Financiers of Kazakhstan.
In addition to adults, children from the age of 6 actively use non-cash payments, with 41.4% of parents having arranged cards for their children (data is taken from Kursiv Research, the Center for Sociological Research).
The safety of citizens' bank deposits is ensured by the state deposit guarantee system, in which 19 banks participate. The return of deposits up to 20 million KZT is guaranteed by the state.
Placing money in deposits not only ensures their safety but also protects against inflation.
In this regard, the number of individual deposits in banks increased from 16.9 million to 19.8 million, with an annual growth of 14.3%, and the total volume of deposits amounted to 18.6 trillion KZT (data from the Kazakhstan Deposit Insurance Fund).
Considering the insignificant volume of cash in the country's circulation, each citizen can declare cash up to 34.5 million tenge (10,000 MCI) during declaration. The presence of other funds is confirmed by second-tier banks.
The Tax Code requires banks to provide tax authorities with information about taxpayers' bank accounts (Article 26 of the Tax Code).
This requirement does not contradict the norms of the Constitution, as restrictions on this right are allowed in cases and in the manner directly established by law (paragraph 2 of Article 18 of the Constitution).
In this regard, the norms of the Law «On Banks and Banking Activities» (Article 50) and the Tax Code (Article 30) provide for the disclosure of bank secrecy for tax purposes.
Please note that it is necessary to declare assets located abroad and in Kazakhstan as accurately as possible. In the future, the value of assets will be considered when determining taxable income.
Declaration of Other Property and Gifts
Citizens may optionally include in their assets and liabilities declaration any valuable property worth more than 3 450 000 KZT (1,000 MCI) per item.
Such property includes any expensive property located both in the Republic of Kazakhstan and abroad, for example, cultural values, jewelry, pedigree animals, and other valuable property, as well as objects of unfinished construction.
This property is declared if there is an appraisal value as at December 31, 2023. The appraisal must be done before the submission of the declaration (no later than September 15, 2024).
Valuable gifts are declared if they are received in the form of:
Declaration of Animals and Birds
In the declaration of assets and liabilities, citizens may optionally declare animals and birds of expensive breeds, the value of which exceeds 3 450 000 KZT (1,000 MCI) per unit. For example, a pedigree racehorse, exotic animal, or bird.
Animals and birds used for breeding or personal needs do not need to be declared. Information about agricultural and domestic animals is obtained by the revenue authorities from authorized bodies.
How do tax authorities learn about incomes from foreign sources?
Since 2021, the Ministry of Finance has been receiving information about the incomes of Kazakhstani citizens deposited in foreign banks. These details are provided in accordance with the Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information (CRS) under the Convention on Mutual Administrative Assistance in Tax Matters (Strasbourg, January 25, 1988).
Annually, information is received from 80 countries, with the main countries being the UAE, the United Kingdom, Turkey, France, and others.
The incoming information is used exclusively for tax administration purposes to determine tax obligations under individual income tax.
Declaration Adjustment
Citizens have the right to correct any errors or inaccuracies themselves by submitting an additional declaration within the statute of limitations provided by the Tax Code.
How is tax control of individuals' income conducted?
First, an automatic desk audit is conducted – monitoring the expenditures of individuals as follows:
What guarantees are there for ensuring information security and preventing data leaks?
The information systems of the Revenue Committee operate in a closed loop, without internet access. This ensures the safety of all information received from taxpayers.
The State Technical Service conducts quarterly monitoring to ensure the information security of the Revenue Committee's systems.
In addition, access to the declarations is limited to a small group of employees who bear personal responsibility, including administrative and criminal liability.
Administrative Liability of Individuals is envisaged in the following cases:
What will happen if an individual does not want to submit a declaration and is willing to pay an administrative fine every year?
From 2025, an individual's failure to submit a declaration of assets and liabilities, income, and property, will be considered as confirmation of the absence of:
In case such an individual acquires property, its value will be recognized as income and taxed (Article 72 of the Tax Code).
At the same time, hiding taxable objects is subject to a fine of 200% of the unpaid tax amount; for a repeated violation, the fine is 300%.