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

Article 117. Penalties for overdue taxes and payments to the budget

1. A penalty is an amount specified in paragraph 2 of this article, which is accrued on the amount of overdue taxes and payments to the budget, including advance and (or) current payments of them.

2. A penalty is charged:

1) regardless of the application of other methods for securing the fulfillment of an overdue tax obligation to pay taxes, payments to the budget, enforced collection measures and other sanctions for violation of the tax legislation of the Republic of Kazakhstan;

2) for each day of delay in the fulfillment of a tax obligation for the payment of taxes and payments to the budget, beginning from the day following the deadline for the payment of a tax and payment to the budget, including advance and (or) current payment of them, including the day of payment to the budget, in the amount of 1.25 times the official refinancing rate established by the National Bank of the Republic of Kazakhstan, for each day of delay, unless otherwise provided by Subparagraph 2-1) of this Paragraph;

2-1) for each day of delay in the fulfillment of a tax obligation for the payment of corporate income tax calculated in accordance with Article 302 of this Code, and individual income tax calculated on taxable income determined in accordance with Article 366 of this Code, arising from September 1 of the year following the reporting tax period, an additional declaration on these types of taxes for the reporting tax period, beginning from the day following the deadline for the payment, including the day of payment to the budget, in the amount of 0.65 times the official refinancing rate established by the National Bank of the Republic of Kazakhstan, for each day of delay;

3) if the deadline is changed for a tax obligation for the payment of taxes and (or) fees, if the deadline is extended for filing tax returns, additional tax returns;

4) when paying the amounts of taxes and payments to the budget, including advance and (or) current payments of them, including the day of:

the write-off of money from a taxpayer’s bank account by second-tier banks or organizations carrying out certain types of banking operations;

payment by a taxpayer through ATMs or point-of-sale terminals;

payment by a taxpayer, the authorized state body of the said amounts to second-tier banks or organizations carrying out certain types of banking operations;

the offset of an overpaid amount of tax, payment to the budget;

execution of a collection order;

5) when conducting tax and (or) customs audit - until the day of completion of such an audit.

After assessed (calculated) amounts indicated in an audit findings report are entered into the taxpayer’s personal account - from the date of completion of the tax and (or) customs audit, including the day of payment;

6) to second-tier banks or organizations carrying out certain types of banking operations for:

non-observance of the order of priority in writing off amounts from bank accounts;

failure to transfer (credit) them to the budget;

untimely transfer to the budget of:

amounts written off from bank accounts of taxpayers,

cash paid at cash departments of second-tier banks or organizations carrying out certain types of banking operations for the payment of taxes and payments to the budget, including advance and (or) current payments of them, penalties, fines,

accrued bank fees.

3. No penalty is charged:

to creditors of second-tier banks being in involuntary liquidation if the sole reason for non-payment of taxes and payments to the budget was the liquidation of the second-tier bank servicing them - from the date of a final and binding court judgment on involuntary liquidation of the second-tier bank;

creditors of a forcibly terminating branch of a non-resident bank of the Republic of Kazakhstan, if the only reason for the formation of unpaid amount of taxes and payments to the budget on time was compulsory termination of the activities of a branch of a non-resident bank of the Republic of Kazakhstan serving them - from the date of adoption by the authorized body for regulation, control and supervision of the financial market and financial organizations of the decision to revoke the license;

in case of a final and binding court judgment on compulsory issue - from the day of filing a statement of claim for compulsory issue of authorized shares with court and until their placement;

in case of a final and binding court judgment on recognizing an individual as missing from the effective date of the court judgment until its reversal;

on excess profits tax for a period preceding five taxable periods before the calendar year in which a violation of the tax legislation of the Republic of Kazakhstan was revealed;

when tax authorities revise calculated amounts of property taxes, land tax and tax on vehicles of individuals after the due date for payment of these taxes for a relevant taxable period;

when the deadline for the fulfillment of the tax obligation to pay taxes and (or) fees in respect of the taxpayer is changed in the event that the court approves the debt restructuring agreement in accordance with the Law of the Republic of Kazakhstan "On Rehabilitation and Bankruptcy";

In the existence of an agreement concluded with the authorized body for investments on an investment tax credit during its validity term and on taxes for which such a credit is granted;

when a court passes a ruling on initiating proceedings in a bankruptcy case - from the date of such a ruling;

when the court issues a ruling on the initiation of rehabilitation proceedings - from the date of such ruling;

when applying the debt restructuring procedure - from the date of the court's decision to apply such a procedure;

on an amount of calculated (assessed) taxes and payments to the budget that emerged as a result of violation of the tax legislation of the Republic of Kazakhstan by a taxpayer (tax agent) when fulfilling tax obligations in accordance with the received preliminary explanation, except for the establishment of previously unknown facts.

For the purposes of this article, previously unknown facts are those affecting the opinion of a tax authority stated in the provided preliminary explanation, which were not earlier reported:

to tax authorities in the request of a taxpayer (tax agent) for preliminary explanation;

in written representations pursuant to requests of a tax authority or its officials within the process of consideration of the taxpayer’s (tax agent’s) request for preliminary explanation.

4. The charge of a penalty is reinstated in case of:

1) a final and binding court judgment on the refusal to declare a taxpayer bankrupt - from the date of the court’s ruling on the initiation of proceedings in the bankruptcy case;

2) the entry into legal force of the court ruling on the refusal to approve the rehabilitation plan - from the date of the court's ruling on the initiation of the rehabilitation proceedings;

2-1) entry into legal force of a court decision on the refusal to apply a rehabilitation procedure to a taxpayer - from the day the court issues a ruling to initiate a rehabilitation case;

3) the taxpayer’s failure to conclude an insolvency resolution agreement within the period established by the Law of the Republic of Kazakhstan “On Rehabilitation and Bankruptcy” or the court’s ruling on the refusal to approve such an agreement - from the day of the court’s decision on application of the insolvency procedure.

Footnote. Article 117 as amended by the Law of the Republic of Kazakhstan dated 21.01.2019 No. 217-VI (shall be enforced upon expiry of ten calendar days after its first official publication); No. 290-VІ dated December 27, 2019 (shall be enforced upon expiry of ten calendar days after the day of its first official publication); dated 10.12.2020 No. 382-VI (effective from 01.01.2021); dated 21.12.2022 No. 165-VII (shall be enforced from 01.01.2023).