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

Article 247. Deduction of paid doubtful liabilities

1. If doubtful liabilities earlier recognized as income were paid by a taxpayer to a creditor, then subject to deduction is the amount of the payment made, except for VAT amount taken as an offset in accordance with paragraph 2 of Article 405 of this Code.

Such a deduction is made in the taxable period in which the payment was made, up to the amount earlier allocated to income.

2. The procedure for allocating to deductibles provided for in this article shall also apply in case of payment of liabilities earlier recognized as income in accordance with Article 229 of this Code.
Article 248. Deduction of doubtful claims

1. Unless otherwise established by Paragraph 7 of this Article, doubtful claims shall be considered to be those:

1) arising in connection with the sale of goods, the performance of works, the rendering of services to legal entities and individual entrepreneurs, as well as non-resident legal entities operating in the Republic of Kazakhstan through a permanent establishment, structural unit of a legal entity and not satisfied within a three-year period calculated in accordance with paragraph 4 of this article;

2) arising in connection with the sale of goods, the performance of works, the rendering of services to legal entities and individual entrepreneurs and not satisfied in connection with declaring a debtor-taxpayer bankrupt in accordance with the legislation of the Republic of Kazakhstan;

3) in connection with the inclusion of fines and penalties in the total annual income on the basis of effective court ruling on bank credit (loan) agreements and microcredit agreements, on the claims of an organization specializing in improving the quality of loan portfolios of second-tier banks, whose sole shareholder is the Government of the Republic of Kazakhstan, not satisfied within a three-year period calculated in accordance with paragraph 4 of this article.

2. Doubtful claims are subject to deduction from a person that:

1) sold goods, performed works, rendered services and did not assign the right of such a claim;

2) sold goods, performed works, rendered services and assigned the right of such a claim;

3) acquired the right of claim of goods sold, works performed, services rendered from a person specified in subparagraph 2) of this paragraph;

4) inclusion in the total annual income of fines and penalties on the basis of effective court ruling under bank credit (loan) agreements and microcredit agreements, on the claims of an organization specializing in improving the quality of loan portfolios of second-tier banks, whose sole shareholder is the Government of the Republic of Kazakhstan.

3. Doubtful claims are subject to deduction from the person:

1) specified in subparagraph 1) of paragraph 2 of this article – up to the amount including the value of goods sold, works performed, services rendered, as well as the amount of other claims arising in connection with such sale of goods, performance of works, rendering of services, including the amount of forfeits (fines, penalties), but not more than the amount of earlier recognized income;

2) specified in subparagraph 2) of paragraph 2 of this article – up to the amount of a positive difference between the amount including the value of goods sold, works performed, services rendered and the amount of other claims arising in connection with such sale of goods, performance of works, rendering of services, including the amount of forfeits (fines, penalties), but not more than the amount of earlier recognized income, and the value of the assigned right of claim;

3) specified in subparagraph 3) of paragraph 2 of this article – up to the amount including the value of goods sold, works performed, services rendered, as well as the amount of other claims arising in connection with such sale of goods, performance of works, rendering of services, including the amount of forfeits (fines, penalties), but not more than the amount of earlier recognized income, in accordance with Article 233 of this Code, increased by the value of the acquired right of claim;

4) specified in subparagraph 4) paragraph 2 of this article – up to the amount of earlier recognized income indicated in subparagraph 13) of paragraph 1 of Article 226 of this Code.

4. In cases provided for by subparagraph 1) of paragraph 1 of this article, doubtful claims are deductible in the taxable period in which a three-year period expired that is calculated:

1) for persons specified in subparagraphs 1) and 2) of paragraph 2 of this article:

for doubtful claims that arose under credit (loan) agreements - from the day following the day of maturity of interest in accordance with the terms of a credit (loan) agreement;

for doubtful claims that arose under lease agreements - from the day following the day of maturity of a lease payment in accordance with the terms of a lease agreement;

in other cases - from the day:

following the expiration of a deadline for the claim of sold goods (works, services), the deadline for which is fixed;

of transfer of goods, performance of works, rendering of services under the claim of sold goods (works, services), the deadline for which is not fixed;

2) for persons specified in subparagraph 3) of paragraph 2 of this article:

for doubtful claims that arose under credit (loan) agreements - from the day following the day of maturity of interest in accordance with the terms of a credit (loan) agreement;

for doubtful claims that arose under lease agreements - from the day following the day of maturity of a lease payment in accordance with the terms of a lease agreement;

in other cases - from the following dates whichever comes last:

the day following the expiration of a deadline for the claim of sold goods (works, services), the deadline for which is fixed;

the day of assignment of the right of claim of sold goods (works, services), the deadline for which is not fixed;

5. In cases provided for by subparagraph 2) of paragraph 1 of this article, doubtful claims are subject to deduction in the taxable period in which a court ruling on completion of bankruptcy procedure became final and binding.

6. In cases provided for by subparagraph 3) of paragraph 1 of this article, doubtful claims are deductible in the taxable period in which a three-year period, calculated from the day of entry into legal force of a court decision, expired.

7. Claims are not recognized as doubtful ones if these are claims of taxpayers entitled to deduct the amount of expenses for creating provisions (reserves) in accordance with paragraph 1 of Article 250 of this Code for the payment of accrued, after December 31, 2012,:

1) interest on deposits, including balances of correspondent accounts with other banks;

2) interest on loans (except for financial lease) granted to other banks and clients;

3) receivables for documentary settlements and guarantees;

4) contingent liabilities for unsecured letters of credit, issued or confirmed guarantees.

8. Unless otherwise provided for in paragraph 9 of this article, a taxpayer shall allocate doubtful claims to deductibles with concurrent observation of the following conditions:

1) documents confirming the occurrence of claims shall be available;

2) claims shall be stated in accounting records at the time of deduction or such claims shall be allocated to expenses in accounting records of previous periods.

9. In the case provided for by subparagraph 2) of paragraph 1 of this article, besides documents specified in paragraph 8 of this article, a copy of the court ruling on completion of bankruptcy procedure is required in addition.

Footnote. Article 248 as amended by the Law of the Republic of Kazakhstan dated 02.04.2019 No. 241-VI (shall be enforced from 01.01.2018); dated 10.12.2020 No. 382-VI (effective from 01.01.2020).