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

Article 381. Features of determination of the amount of turnover from sale in individual cases

1. In case of the pledger’s transfer of pledged property into the ownership of a buyer or the pledgee, the amount of the pledger’s turnover from the sale is determined:

1) as the amount of the value of realizable pledged property based on the applied selling price ex VAT – when selling pledged assets;

2) when the pledged property is turned into the ownership of the pledgee - in the amount of the current appraised value established by a court decision or a trustee on the basis of the conclusion of an individual or legal entity licensed to carry out property valuation activities (with the exception of intellectual property, the value of intangible assets), without including VAT into it. In this case, the trustee shall be determined in accordance with the civil legislation of the Republic of Kazakhstan when selling the pledged property in a compulsory out-of-court procedure through tenders.

2. The amount of the taxpayer’s turnover from the sale in case of placement of goods, earlier exported under the customs export procedure, under the customs re-import procedure is determined in proportion to the volume of goods placed under the customs re-import procedure, in units of measurement applied when placing goods under the customs export procedure, on the basis of the value of goods, which was indicated in the VAT declaration with regard to the turnover from the export sale of the goods.

3. When selling a whole enterprise as a property complex, the amount of turnover from the sale is determined as the amount of the book value of the property transferrable in the sale, the VAT on which was earlier offset, which is:

1) increased by positive difference between the selling price under a contract of sale of the enterprise and the book value of transferrable assets, reduced by the book value of transferrable liabilities, according to accounting records as of the date of sale;

2) reduced by negative difference between the selling price under a contract of sale of the enterprise and the book value of transferrable assets, reduced by the book value of transferrable liabilities, according to accounting records at the date of sale.

4. When transferring property into financial lease, the amount of turnover from the sale is determined as the amount:

1) as of effective date of the turnover specified in subparagraph 1) of paragraph 11 of Article 379 of this Code - on the basis of the amount of a lease payment under a financial lease agreement exclusive of the amount of remuneration for financial lease and VAT;

2) as of effective date of the turnover specified in subparagraph 2) of paragraph 11 of Article 379 of this Code - on the basis of the amount of all periodic lease payments exclusive of the amount of remuneration for financial lease and VAT, the maturity date for which is set before the date of transfer of property to the lessee under a financial lease agreement;

3) as of effective date of the turnover specified in subparagraph 3) of paragraph 11 of Article 379 of this Code - as the difference between the total amount of all lease payments (to be) received under a financial lease agreement exclusive of the amount of remuneration for financial lease and VAT, and the amount of taxable turnover defined as the sum of the amounts of taxable turnovers falling on previous effective dates of the turnover from sale under this agreement;

4) as of effective date of the turnover specified in subparagraph 4) of paragraph 11 of Article 379 of this Code – as the accrued amount of remuneration.

5. The amount of turnover from the sale in case of transferring goods free of charge is determined as the amount of the book value of transferrable goods that is (to be) indicated in the taxpayer’s accounting records as of the date of their transfer, unless otherwise provided for by the legislation of the Republic of Kazakhstan on transfer pricing.

The amount of turnover from the sale with regard to works performed and services rendered free of charge is determined on the basis of the book value of goods, the value of works and services provided all of the following conditions are observed:

used for free performance of works, rendering of services;

when purchasing such goods, works, services, VAT was accounted for as VAT to be offset, including the one determined using a proportional method;

shall be subject to inclusion in the accounting of the taxpayer as expenses in accordance with international financial reporting standards and (or) requirements of the legislation of the Republic of Kazakhstan on accounting and financial reporting.

The value of fixed assets and also of the assets provided for in subparagraphs 2), 3), 4), 9), 10) and 11) of paragraph 2 of Article 228 of this Code, in case of their transfer into free use for inclusion in taxable turnover, is determined as follows:

Va = (VATp/Pu) х Ma/rate,

where:

Va - the value of an asset included in taxable turnover in case of transfer into free use;

VATp - the amount of VAT offset in case of purchase of an asset transferred into free use;

Pu - the period of use of an asset, calculated in calendar months, is determined:

for assets subject to depreciation in accounting, as the useful life of an asset, determined in accounting for depreciation in accordance with international financial reporting standards and (or) the legislation of the Republic of Kazakhstan on accounting and financial reporting;

with regard to other assets - as the service life of the asset determined on the basis of technical documentation for the asset, and in case of no such documentation - 120 months;

Ma - actual number of months of assignment for use, included in a reporting taxable period;

rate - the rate of VAT in percentage terms, valid as of the date of provision for use.

6. In case of assignment of rights to claim sold goods, works, services subject to VAT, except for advance payments and penalties, the amount of turnover from the sale is determined as positive difference between the assigned value of the right of claim and the value of the claim receivable from a debtor as of the date of assignment of the right of claim, according to the taxpayer’s source documents.

7. The amount of turnover from the sale is determined as the amount of remuneration ex VAT provided for by:

1) an agreement on limiting or terminating entrepreneurial activity – in case of consent to limit or terminate entrepreneurial activity;

2) a credit (loan, microcredit) agreement - when granting a credit (loan, microcredit);

3) an agency agreement – in case of the agent’s sale of goods, performance of works, rendering of services on behalf of and at the expense of the principal, in case of the agent’s transfer of goods purchased for the principal to the principal, and also performance of works, rendering of services by a third party for the principal in a transaction entered into by the agent with such a third party on behalf of and at the expense of the principal.

8. The amount of turnover from the sale in case of financing by an Islamic bank, in accordance with the legislation of the Republic of Kazakhstan on banks and banking activity of individuals and legal entities, as a trade intermediary by way of granting a commercial loan, in accordance with Subparagraphs 7) and 8) of Paragraph 2 of Article 372 of this Code shall be determined as the amount of income to be received by an Islamic bank.

For the purposes of this paragraph, the income to be received by an Islamic bank includes the amount of the mark-up on goods sold to the buyer, which is determined by the terms of the Islamic Bank’s commercial loan agreement, concluded in accordance with the legislation of the Republic of Kazakhstan on banks and banking activity.

The provisions of this paragraph do not apply to cases of the Islamic bank’s sale of a product to a third party if the buyer refuses to perform the commercial loan agreement.

9. When selling goods, performing works, rendering services on the terms consistent with those of a commission agreement, in case of transfer to the principal of the goods purchased by the commission agent for the principal on the terms consistent with those of a commission agreement, and also in case of performance of works, rendering of services to the principal by a third party in a transaction entered into by such a third party with the commission agent, the amount of the commission agent’s turnover from the sale is determined as the amount of either:

his/her/its commission fee ex VAT; or

the value of works, services, which are the commission agent’s turnover from the purchase of works, services from a non-resident.

10. When performing works, rendering services under a freight forwarding agreement by a carrier and (or) other suppliers to a party that is the client under a freight forwarding agreement, the amount of the freight forwarder’s turnover from the sale shall be determined as the amount of either:

his/her/its remuneration ex VAT under a freight forwarding agreement; or

the value of works, services, which are the freight forwarder’s turnover from the purchase of works, services from a non-resident.

11. The amount of turnover from the sale of print periodicals and other media products, including those posted on an Internet resource in public telecommunications networks, is determined as the sales value of print periodicals and other media products delivered (shipped, placed) in a reporting taxable period based on the prices and tariffs ex VAT applied by transaction parties.

12. In case of an employer’s transfer of goods, performance of works, rendering of services to an employee in order to repay debts to the latter, the amount of turnover from the sale is determined using the formula below:

Ts = Ap х 100/(100+rate), where:

Ts - turnover from the sale in case of an employer’s transfer of goods, performance of works, rendering of services to an employee in order to repay debts to the latter;

rate - VAT rate in effect as of the date of transfer of goods, in percentage terms;

Ap - an amount payable to an employee, which is paid off by transferring goods, performing works, rendering services.

13. The amount of turnover from the sale in case of loss of goods purchased without VAT under the customs procedure for free customs zone, except for the goods specified in Article 394 of this Code, shall be determined as the amount of the book value of goods, which to be indicated in the taxpayer’s accounting records as of the date of their loss.

14. The amount of turnover from the sale of containers, that are recognized as returnable containers in accordance with subparagraph 5) of paragraph 5 of Article 372 of this Code and not returned within the established period, is determined as the book value of such containers (to be) indicated in accounting records as of the date of their return.

15. Despite the provisions of paragraphs 1 - 14 of this Article, the amount of sales turnover shall be determined:

1) as positive difference between the sales value and the purchase value of cars when selling cars, purchased by a legal entity from individuals, to an individual;

2) when rendering services of a tour operator for outbound tourism - as a positive difference between the cost of selling a tourist product and the cost of services for insurance, passengers transportation and accommodation, including food, if the cost of such food is included in the cost of living, remuneration of a travel agent;

3) as an increase in value in the sale of securities, participatory interests determined in accordance with Article 228 of this Code - when carrying out transactions with securities, participatory interests;

4) as positive difference between the sales value and the book value of goods indicated in accounting records as of the date of transfer - when selling goods, VAT on which, indicated in invoices issued when purchasing these goods in accordance with the tax legislation of the Republic of Kazakhstan, effective as of the date of their purchase, is not recognized as VAT to be offset;

5) in case of transfer of goods:

to a shareholder, participant, founder in case of liquidation of a legal entity or distribution of property with a decrease in the authorized capital - as positive difference between the book value of transferrable goods (to be) indicated in accounting records of the legal entity, transferring such goods, as of the date of transfer, with no regard for their revaluation and impairment, and the amount of the paid authorized capital attributable to a participatory interest, the number of shares in proportion to which the property is distributed;

to a participant, founder, in case of repurchase by a legal entity from such a founder, a participant of a participatory interest or part thereof in this legal entity - as positive difference between the book value of transferrable goods, which is (to be) indicated in accounting records of the legal entity transferring such goods, as of the date of their transfer, with no regard for their revaluation and impairment, and the amount of the paid authorized capital attributable to a redeemable participatory interest;

to a shareholder in case of redemption by an issuing legal entity of shares issued by it - as positive difference between the book value of transferrable goods (to be) indicated in accounting records of the legal entity transferring such goods, as of the date of transfer, with no regard for their revaluation and impairment, and the amount of the paid authorized capital attributable to the redeemable number of shares.

16. The amount of turnover when rendering services of a casino, slot machine hall, sweepstakes and bookmaker, provided by Article 16 of this Code shall be determined by the amount of income received for the taxable period as a result of the provision of services to the casino, slot machine hall, sweepstakes and bookmaker.

17. The amount of turnover when a lottery operator sells lottery tickets, receipts or other documents shall be determined in the amount of one of the following amounts:

1) the cost of sold lottery tickets, receipts or other documents minus the amount of the formed prize fund, deductions for the development of physical culture and sports in accordance with the Law of the Republic of Kazakhstan "On lotteries and lottery activities" and expenses associated with the lottery, if supporting documents are available;

2) four percent of the value of sold lottery tickets, receipts or other documents - if the amount determined in accordance with subparagraph 1) of this paragraph is less than four percent of the value of sold lottery tickets, receipts or other documents.

Footnote. Article 381 as amended by the Law of the Republic of Kazakhstan dated 02.04.2019 No. 241-VI (enforcement see Article 2); dated 10.12.2020 No. 382-VI (see Article 2 for the procedure of entry into force); dated 21.12.2022 No. 165-VII (shall be enforced from 01.01.2023).