Renting an apartment: how and when to pay taxes, tax reporting

Renting an apartment: how and when to pay taxes, tax reporting

   Dear taxpayers, we remind you that renting out real estate is an entrepreneurial activity. The income from it is taxed, for evasion from which administrative liability is threatened.

There are four ways to organize a legitimate rental business: two tax regimes involve registration as an individual entrepreneur (sole proprietor) and two exempt from this. Each of them has its own conditions and limitations.

  1. With registration of an individual entrepreneur

Individual entrepreneurs can rent housing under a patent or on the basis of a simplified declaration. Both modes allow you to hire employees and participate in the funded pension and health insurance systems.

For landlords registered as sole proprietors, the payment conditionally consists of two amounts:

— tax (1 or 3% of income, depending on the regime). This part is canceled until January 1, 2023;

— mandatory deductions: pension (10%), social (3.5%), health insurance (5% of 1.4 minimum wage).

Deductions are calculated from the minimum wage in 2022 - 60,000 tenge.

If the rental income does not exceed 10 million tenge per year, it is recommended to choose a patent-based mode. It suits most landlords.

1.1 Patent

Tax 1% of income (not paid until January 1, 2023) + mandatory deductions.

Basic conditions:

— personal entrepreneurship without the involvement of employees;

— income of no more than 3528 MCI (10.8 million tenge) for a calendar year.

A business permit is redeemed in advance for a certain period (from a month to a year).

Submission of declarations is not required. To pay, fill out the form 911.00.

Example: an annual patent for renting an apartment for 100,000 tenge per month will cost 147,600 tenge.

Of these:

— social contributions — 25,200 tenge (3.5% of 60,000 for 12 months);

— pension contributions — 72,000 tenge (10% of 60,000 for 12 months);

— medical insurance — 50,400 tenge (5% of 1.4×60,000 for 12 months).

Taking into account the IPN (1% of 100,000 for 12 months = 12,000) the amount would be 159,600 tenge.

To get a patent:

1) Register as a sole proprietor.

This can be done in one day through the portal eGov.kz , elicense.kz or using mobile banking applications.

2) Select the mode based on the patent.

3) Within three working days, submit to the tax service the form 911.

1.2. Simplified declaration

For landlords registered as sole proprietors, the payment conditionally consists of two amounts:

— tax - 3% of income, this part is canceled until January 1, 2023;

— mandatory deductions: pension (10%), social (3.5%), health insurance (5% of 1.4 minimum wage).

Deductions are calculated from the minimum wage (60,000 tenge in 2022) and amount to 12,300 tenge per month

Main conditions:

— the number of employees for the tax period is up to 30 people;

— income no more than 24,038 MCI (73.6 million tenge);

— availability of a cash register.

The declaration (form 910.00) is submitted to the tax office at the payer's location twice a year: no later than August 15 and February 15.

2. Without registration of sole proprietor

Landlords who do not use the labor of employees may not register as individual entrepreneurs. At the same time, the limits of annual income will be significantly lower.

Tax regimes for individuals:

— single aggregate payment (ESP);

— declaration of individual income tax.

2.1. ESP

The ESP is a fixed payment, including income tax, social security, pension and medical insurance. It is paid monthly.

Rates:

— 1 MCI (3063 tenge) — for residents in cities;

— 0.5 MCI (1532 tenge) — in villages.

Conditions:

— no employees;

— services are provided exclusively to individuals;

— annual income up to 1,175 MCI (3.6 million tenge).

Tax reporting and special registration are not required. If there was no income in any of the months, you can not pay the ESP.

Example: when renting an apartment in the city for 100,000 tenge per month, the payment for the year will be 36,756 tenge (3,063 ×12 months).

ESP cannot choose (Article 774 of the Tax Code of the Republic of Kazakhstan):

— Sole proprietor;

— who works in commercial and retail facilities;

— renting out non-residential property;

— engaged in private practice;

— foreigners and stateless persons, with the exception of Candace.

2.2. Declaration of individual income tax

Income tax is 10%.

Payment — once a year, until April 10 in the form of 240.00 (for rent until March 31). There are no social charges.

Example: when renting an apartment for 100,000 tenge per month, the tax for the year will be 120,000 tenge.

An individual can rent housing to individuals and tax agents:

— a legal entity, its structural divisions;

— IP;

— persons engaged in private practice;

— a non-resident legal entity.

At the same time, it is not the individual himself who should calculate and pay the tax, but the entity that pays him the money — the tax agent. The tax rate is also 10% of the amount of income.

How and where to pay taxes

The declaration and calculation can be submitted:

— through the "Taxpayer's Office";

— E-Salyq Azamat mobile app;

— on eGov.kz ;

— in the PSC on paper;

— to the city or district department of state revenue.

Payment is accepted:

— through the eSalyq Azamat mobile application,

— in banks,

— in Kazpost branches.

Administrative liability measures are provided for failure to submit tax reports on time and engage in entrepreneurial activity without registration.

For lack of reporting — first a warning, then a fine of 15 MCI (45,945 tenge).

In case of illegal business activity, decisions on administrative responsibility are made by judicial authorities.