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

Article 279. Income from a long-maturity derivative financial instrument

1. Income from a swap, and also from another derivative financial instrument, the validity of which exceeds twelve months from the day of its conclusion and the settlement of which provides for payments, the amount of which depends on changes in price, exchange rate, interest rates, indices and another indicator established by such a derivative financial instrument, before the expiry of the financial instrument is determined as excess of proceeds over expenses with account of the provisions established by this article.

For tax accounting purposes, income from a derivative financial instrument specified in this paragraph is recognized in each taxable period in which the excess specified in this paragraph emerges.

2. Proceeds from a derivative financial instrument specified in paragraph 1 of this article are payments (to be) received with respect to this derivative financial instrument during a reporting taxable period.

3. Expenses for a derivative financial instrument specified in paragraph 1 of this article shall be payments (to be) made during a reporting taxable period with respect to this derivative financial instrument.
Article 280. Features of tax accounting for hedging transactions

1. Hedging is transactions with derivative financial instruments purposed to reduce possible losses resulting from adverse changes in the price, exchange rate, interest rate or other indicator of a hedged item and recognized as hedging instruments in the taxpayer’s accounting records in accordance with international financial reporting standards and (or) requirements of the legislation of the Republic of Kazakhstan on accounting and financial reporting. Hedged items are assets and (or) liabilities, as well as cash flows associated with these assets and (or) liabilities or with forecasted transactions.

2. To substantiate the allocating of transactions for derivative financial instruments to hedging transactions, a taxpayer makes a calculation to confirm that the performance of these transactions leads (may lead) to a reduction in the amount of possible losses (lost profit) with respect to transactions for a hedged item.

3. Income or loss from a derivative financial instrument, where the hedged item is a particular transaction, is accounted for in accordance with the provisions of this Code, established for the hedged item, as of the day of recognition of the result of the hedging transaction in tax accounting.

4. Income or loss from a derivative financial instrument, where the hedged item is not a particular transaction, is included, accordingly, in total annual income or is deductible in that taxable period in which such income or loss is recognized in accordance with Articles 278 and 279 of this Code.

Footnote. Article 280 as amended by the Law of the Republic of Kazakhstan dated 10.12.2020 No. 382-VI (effective from 01.01.2018).