On taxes and other obligatory payments to the budget (Tax Code)

Article 269. Compilation of the value balance of a group (subgroup) in individual cases

1. Unless otherwise provided for in this article, when a taxpayer switches from a special tax regime for small business entities or peasant or farm enterprises to a standard one, the initial value of fixed assets is the cost of their acquisition reduced by the estimated amount of depreciation.

Unless otherwise provided for in this article, the acquisition cost is the aggregate of costs of acquisition, production, construction, assembly, installation, reconstruction and modernization performed prior to the operation of an asset, except for costs (expenses) specified in subparagraphs 1) - 6) and 8) Article 264 of this Code.

If an asset was earlier received free of charge, for the purposes of this article, the cost of acquiring such an asset is its value included in a taxable item in accordance with paragraph 2 of Article 681 of this Code in the form of property received free of charge.

As to assets received in the form of charitable assistance, inheritance, except for the case provided for in part two of this paragraph, the cost of acquiring an asset is the market value of an asset as of the date of the right of ownership of the asset as determined in a report on appraisal conducted under an agreement between the appraiser and the taxpayer in accordance with the legislation of the Republic of Kazakhstan on appraisal activity.

The estimated amount of depreciation is determined as the product of the following values:

the cost of acquisition of an asset determined in accordance with this paragraph;

the maximum monthly depreciation rate provided for in paragraph 3 of this article;

the number of months after the daythe asset was first put into operation by such a taxpayer.

2. Unless otherwise established by this Article, expenses for reconstruction and modernization of a fixed asset made after the commencement of its operation are recognized as a separate fixed asset with an initial value equal to the amount of such expenses, except for costs (expenses) specified in subparagraphs 1) - 6) and 8) of Article 264 of this Code, reduced by the estimated amount of depreciation.

The estimated amount of depreciation is determined as the product of the following values:

the amount of expenses for reconstruction and modernization, determined in accordance with this paragraph;

the maximum monthly depreciation rate provided for in paragraph 3 of this article;

the number of months after the completion of reconstruction, modernization.

For the purposes of this paragraph, paragraph 3 of Article 334 and paragraph 6 of Article 520 of this Code, reconstruction and modernization are recognized as reconstruction and modernization, the results of which are altogether:

alteration, including renewal, of a fixed asset’s design;

increase in the fixed asset’s service life by more than three years;

improvement of technical characteristics of a fixed asset compared to those at the beginning of a calendar month in which the fixed asset is temporarily taken out of service for reconstruction and modernization.

3. Depending on a group in which a fixed asset is to be included in accordance with paragraph 1 of Article 267 of this Code, the following monthly depreciation rates apply:

Item №	Group №	Fixed assets	Monthly depreciation rate, %
1.	I	Buildings, structures, except for oil, gas wells and transfer devices	0,83
2.	II	Machinery and equipment, except for machinery and equipment for oil and gas production, as well as computers and information processing equipment	2,08
3.	III	Computers, software and information processing equipment	3,33
4.	IV	Fixed assets not included in other groups, including oil, gas wells, transfer devices, machinery and equipment for oil and gas production	1,25

For the purposes of applying paragraph 2 of this article, a fixed asset created as a result of reconstruction and modernization is included in the group in which a fixed asset that underwent reconstruction and modernization is to be included.

4. The initial value of fixed assets is determined in accordance with this paragraph provided all of the following requirements are met:

a taxpayer applying special tax regime for small business entities or special tax regime for peasant or farm enterprises, shall switch to a standard procedure;

a taxpayer applied special tax regime for small business entities or special tax regime for peasant or farm enterprises less than 12 calendar months;

a taxpayer applied a standard procedure prior to switching to special tax regime for small business entities or special tax regime for peasant or farm enterprises.

The initial value of fixed assets is determined on the basis of the size of the value groups (subgroups) as of the day preceding the day of application of special tax regime for small businesses or special tax regime for peasant or farm enterprises and deductions for fixed assets determined in accordance with Articles 266-268 and 270 - 273 of this Code, during the application of special tax regime for small businesses or special tax regime for peasant or farm enterprises.