Agricultural Producers and VAT: Can Excess VAT from One Activity Be Offset Against Another?

If an agricultural producer engages simultaneously in agricultural and other activities, they are required to maintain separate VAT accounting (Article 490 of the Tax Code of the Republic of Kazakhstan).

Key Takeaways:

• Separate accounting is required to correctly calculate the additional VAT offset;

• The final VAT amount is determined at the end of the tax period in accordance with Article 502 of the Tax Code of the Republic of Kazakhstan;

• A positive balance under one Budget Classification Code (BCC/KBK) does not automatically mean that the amount will be offset against VAT payable for another activity.

The procedures for recording tax accruals, payments, offsets, and forming account balances are governed by Article 118 of the Tax Code of the Republic of Kazakhstan and the Rules for Maintaining Personal Tax Accounts (Order of the Ministry of Finance of the Republic of Kazakhstan No. 637).