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Tax Disputes

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Kazakhstan - GRATA International
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The Kazakh tax regime comprises:

  • the Code of the Republic of Kazakhstan dated 25 December 2017, No 120-VI on Taxes and Other Mandatory Payments to the Budget (‘Tax Code’), which is the primary legal act on taxation;
  • subordinate legal acts adopted to implement the Tax Code, including acts of the government, ministries and local representative bodies; and
  • ratified international treaties, which take precedence over the Tax Code in case of contradictions.

The procedure for tax disputes is set out in:

  • the Tax Code;
  • the Code of the Republic of Kazakhstan dated 29 June 2020, No 350-VI on the Administrative Procedural Code of the Republic of Kazakhstan (APC); and
  • the Civil Procedural Code of the Republic of Kazakhstan dated 31 October 2015, No 377-V, in cases not regulated by the APC.

Kazakhstan - GRATA International
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Along with the Tax Code, tax relations are regulated by:

  • normative rulings of the Constitutional Court of Kazakhstan; and
  • normative rulings of the Supreme Court of Kazakhstan.

Agreements and acts adopted within the framework of the Eurasian Economic Union (EAEU), as supranational legislative acts, regulate:

  • the principles of taxation on the import and export of goods, works and services between EAEU countries; and
  • certain issues of tax control over them.

Kazakhstan - GRATA International
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In Kazakhstan, the authorities responsible for enforcing the tax laws are primarily:

  • the Tax Service of the State Revenue Committee of the Ministry of Finance, together with its regional branches, which is the main body responsible for:
    • the administration and enforcement of tax laws; and
    • the collection of taxes, duties and other mandatory payments to the state budget; and
  • the Customs Service of the State Revenue Committee of the Ministry of Finance and its regional branches, which is responsible for the enforcement of tax laws related to:
    • import and export taxes (value-added tax, excise, rental tax); and
    • other relevant payments on goods crossing the border.

The general approach to tax enforcement in Kazakhstan is as follows:

  • The tax authorities inform taxpayers of their obligations and the importance of compliance, providing explanations of the tax laws.
  • Regular desk or on-site audits are conducted to ensure compliance. These can be routine or triggered by specific risk factors or suspicions of non-compliance. Additionally, the tax authorities have the right to file claims to recognise transactions as fictitious.
  • Non-compliance with tax laws can result in penalties, fines and other obligations.
  • Taxpayers have the right to appeal the tax authorities’ decisions and seek resolution through administrative or judicial processes.
  • The tax authorities may collaborate with other governmental bodies, such as law enforcement agencies and foreign governmental bodies, to ensure the comprehensive enforcement of tax laws.

Kazakhstan - GRATA International
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The tax authorities, within the framework of information exchange and provision for the purpose of tax compliance, cooperate with:

  • other national authorities, such as:
    • the customs authorities;
    • the National Bank of the Republic of Kazakhstan;
    • the Financial Monitoring Agency;
    • the Department of Economic Investigations;
    • the Prosecutor’s Office; and
    • the Real Estate Centre of the Ministry of Justice; and
  • foreign tax and customs authorities (especially with customs authorities of the EAEU member countries).

The tax authorities also conduct joint tax audits with state bodies such as:

  • the customs authorities; and
  • the Department of Economic Investigations.

Tax audits can also be initiated at the request of:

  • the Prosecutor’s Office; or
  • the Department of Economic Investigations.

Kazakhstan - GRATA International
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Kazakhstan’s tax authorities employ a variety of methods to monitor compliance with tax laws. The primary compliance monitoring mechanisms include:

  • monitoring compliance:
  • monitoring and analysing digital tax returns and filings;
  • monitoring and analysing digital tax invoices and accompanying invoices for goods;
  • transfer pricing reporting for multinational corporations to ensure compliance with transfer pricing regulations and prevent profit shifting;
  • tax monitoring of large taxpayers;
  • horizontal monitoring;
  • transaction monitoring;
  • tax surveys at the taxpayer’s location to prevent fake companies;
  • desk tax audits;
  • on-site audits; and
  • interagency collaboration and international cooperation with counterparts to share and exchange information.

Monitoring varies depending on the taxpayer and type of tax, and involves, among other things:

  • intensive monitoring of value added tax (VAT) compliance through digital tax invoices, including verifying claims for VAT refunds relating to exports, to prevent VAT fraud;
  • focused inspections and audits for industries that are subject to excise taxes (eg, alcohol, tobacco, fuel), to ensure accurate reporting and payment; and
  • a risk management system that focuses monitoring efforts on sectors or taxpayers deemed to be high risk based on:
    • historical data;
    • industry standards; and
    • other risk indicators.

Kazakhstan - GRATA International
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Usually, the following factors can lead to a tax investigation:

  • a low tax burden ratio;
  • late payment of taxes;
  • violations of transfer pricing;
  • losses during the period of zero rate application;
  • reimports of goods;
  • settlements on fictitious transactions;
  • settlements with unreliable enterprises;
  • settlements with enterprises for which the issue of an electronic invoice is restricted;
  • settlements with related parties;
  • tax arrears of suppliers;
  • discrepancies in desk audits for the period of the requirement; and
  • confirmed violations in desk audits.

As a result of the application of the risk management system (see question 2.1), discrepancies between the information indicated in the tax declaration and data received from other sources may serve as grounds for a desk tax audit.

Significant changes in income or deductible expenses that do not correspond to previous patterns or industry standards may trigger red flags.

Certain industries which are known for their cash operations or frequent non-compliance with tax legislation may be subject to heightened scrutiny.

Repeated reporting of losses over 10 years may attract the attention of the tax authorities, especially if the losses seem disproportionate.

Kazakhstan - GRATA International
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The general limitation period for commencing a tax investigation is three years.

For the parties listed below, the statute of limitations for tax purposes is set at five years:

  • large business entities;
  • parties engaged in activities under a subsoil use contract; and
  • residents recognised as controlled foreign companies.

Kazakhstan - GRATA International
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Scheduled tax audits in Kazakhstan are conducted on the basis of a risk assessment derived from the analysis of:

  • tax reporting;
  • information from authorised government authorities; and
  • information obtained from official and open sources regarding the activities of taxpayers.

The tax authorities will notify the taxpayer 30 days before conducting a tax investigation. The basis for conducting the investigation is an order that specifies the issues that are subject to verification.

A scheduled tax audit based on risk assessment will be conducted according to a semi-annual schedule, which is published by:

  • 25 December for the first half of the year; and
  • 25 May for the second half of the year.

A tax audit is considered to start from the date on which the tax audit order is handed over, which must first be registered with the Prosecutor’s Office. The order must include the following information:

  • the date and registration number of the order of the tax authority;
  • the name of the tax authority that issued the order;
  • the full name of the taxpayer or the full name of the legal entity;
  • the identification number;
  • the form and type of audit;
  • the names of the inspectors and specialists involved in the audit;
  • the period of the audit; and
  • the period being audited.

The tax authorities will:

  • request the necessary information for the audit from banks and government authorities;
  • conduct interviews directly with the taxpayer and its employees; and
  • inspect premises.

The taxpayer, in turn, is obliged to:

  • provide all necessary information; and
  • give written and oral explanations upon the tax authority’s request.

Before the tax audit report is drawn up, a preliminary tax audit report is handed over. The taxpayer has the right to provide written objections to the preliminary tax audit report.

Upon completion of the audit, a tax audit report and a notification are issued, reflecting all identified violations. If the taxpayer agrees with the notification, it must comply with all the requirements within the timeframe specified in the notification. This compliance period can also be extended by 60 working days upon the taxpayer’s request.

In case of disagreement, the taxpayer may appeal the audit results through pre-trial settlement and judicial procedures.

Kazakhstan - GRATA International
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The general timeframe for the investigation is 30 working days from the date of issuance of the order, with the possibility of extension in exceptional cases for a period of up to 180 working days. The term of the tax audit may be suspended in exceptional cases for a period of up to 180 working days.

At the same time, the tax audit period may be suspended for an indefinite period in the following cases:

  • The tax authority issues a demand to the taxpayer for the provision of information and/or documents and the taxpayer provides the requested information and/or documents during the tax audit.
  • The tax authority sends a request for information and documents to other territorial tax authorities, state bodies, banks and other organisations.
  • The tax authority sends a request for information to foreign states and receives the requested information in accordance with international agreements.
  • The taxpayer prepares a written objection to the preliminary tax audit report and the tax authority reviews it.

In practice, suspension of the audit period for the above reasons often leads to delays in the tax audit.

Kazakhstan - GRATA International
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During investigations, the tax authorities have the right to demand the following, among other things, in relation to the taxpayer:

  • accounting documentation;
  • written explanations;
  • access to data from the accounting and tax software used for the automation of accounting;
  • written explanations from third parties; and
  • the provision by third parties of information about the taxpayer that is needed to conduct the investigation.

The tax authorities can also conduct cross-checks in relation to counterparties of inspected taxpayer in order to verify and confirm mutual settlements between them.

Kazakhstan - GRATA International
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The taxpayer cannot refuse to disclose commercial information during a tax investigation. However, this information will be considered to be covered by tax secrecy and, under the general rules, it cannot be disclosed by the tax authorities to third parties without the taxpayer’s written consent.

Kazakhstan - GRATA International
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A taxpayer can appeal the results of a tax investigation.

Before the completion of a tax investigation, a preliminary report is issued, to which a written objection can be submitted in case of disagreement. The written objection must be provided within 15 working days of the date on which the preliminary report is delivered.

The written objection will be reviewed by the tax authority that conducted the investigation. If the tax authority disagrees with the objection, it will forward it for review to the State Revenue Committee of the Ministry of Finance.

In case of disagreement with the final results of the tax investigation, the taxpayer’s complaint will be reviewed by the Appeals Commission of the Ministry of Finance, which is a pre-judicial method of dispute resolution. If the complaint is not satisfied by the Appeals Commission, the taxpayer has the right to seek protection of its rights and interests in the courts.

Kazakhstan - GRATA International
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If the taxpayer refuses to provide information and generally cooperate with the tax authorities during the investigation, the tax authorities will independently determine the taxable objects using indirect methods, by analysing the following information:

  • bank statements and statements from organisations that conduct certain types of banking operations regarding the availability and movement of funds in the taxpayer’s bank accounts;
  • information on taxable objects from government agencies, legal entities and local executive bodies;
  • information from the taxpayer’s personal account;
  • information obtained from tax reports;
  • the results of cross-checks with the taxpayer’s counterparties;
  • information obtained by the tax authorities in previous tax investigations; and
  • information obtained by the tax authorities through other forms of tax and customs control.

In case of non-compliance with the requirements of the tax authorities during a tax investigation, the taxpayer will be subject to administrative liability in the form of:

  • a warning; and
  • upon a repeat offence, a fine of 15 monthly calculation indicators (KZT 55,380; in 2025, one monthly calculated indicator will amount to KZT 3,932).

If the taxpayer obstructs the tax authorities’ access to its premises or premises it uses for entrepreneurial activities (except residential premises), administrative liability will entail:

  • a fine of 45 monthly calculation indicators (KZT 176,940); and
  • upon a repeat offence, a fine of 60 monthly calculation indicators (KZT 235,920).

Kazakhstan - GRATA International
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The taxpayer has the right to a deferral and instalment plan for the payment of amounts assessed as payable as a result of a tax investigation by the tax authorities:

  • A deferral with a lump-sum payment of taxes and/or fees is granted for a period not exceeding six months.
  • An instalment plan with monthly or quarterly equal payments of taxes is granted for a period not exceeding three years. An instalment plan for the payment of taxes for a period exceeding one year can be granted only under:
    • the security of the real estate of the taxpayer and/or a third party; and/or
    • a bank guarantee.

A deferral or instalment plan may be granted for one or more taxes.

Kazakhstan - GRATA International
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No, the actions of the tax authorities during a tax investigation are strictly regulated by the tax law.

Kazakhstan - GRATA International
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The tax authorities have the power to enforce the collection of tax debts, regardless of the type of tax. Enforcement is carried out in the following order:

  • from funds held in bank accounts;
  • from the debtor’s accounts;
  • through the sale of restricted assets; and
  • by the compulsory issuance of publicly traded shares.

The tax authority will apply enforcement measures against an organisation if it is classified as high or medium risk according to the risk management system:

  • High-risk organisations: Five business days after notification of the tax debt repayment.
  • Medium-risk organisations: Twenty business days after notification of the tax debt repayment.

Enforcement measures for debt collection are applied to an individual if the debt exceeds one monthly calculation indicator (in 2025, KZT 3,932).

Kazakhstan - GRATA International
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Penalties are imposed by the tax authorities on various grounds, including:

  • failure to file a tax return by the due date;
  • underreporting of income or the provision of inaccurate information that leads to a lower tax liability;
  • failure to provide requested information or documentation during a tax audit;
  • concealment of taxable objects;
  • absence of accounting documentation;
  • tax evasion; and
  • the issuance of fictitious invoices.

Some penalties are fixed and calculated in accordance with the monthly calculation indicators. For entrepreneurial entities, penalties for late payment and underreporting are calculated as a percentage of the unpaid or underreported tax. For more serious offences, penalties may be scaled based on:

  • the severity of the offence; and
  • the amount of tax evaded.

This could include higher percentages or additional fines.

Kazakhstan - GRATA International
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Interest is levied based on the delay in payment of tax obligations. It is calculated as a percentage of the arrears at 1.25 times the base rate (in 2024, the base rate is 14.75%) of the National Bank of the Republic of Kazakhstan for each day of delay.

Kazakhstan - GRATA International
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A taxpayer can challenge both substantive violations and procedural violations.

When disputing substantive violations, the taxpayer can challenge, for example:

  • the correctness of the tax assessment itself;
  • the interpretation of facts and the application of the law; or
  • errors in calculations.

When disputing procedural violations, the taxpayer can challenge the process of the tax investigation or enforcement if it believes that this was improperly performed by the tax authority. Examples might include:

  • improperly delivered notifications;
  • violations of rights during the investigation; or
  • the tax authority’s breach of the statute of limitations for reviewing tax obligations.

Kazakhstan - GRATA International
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The following result in criminal liability:

  • evasion of tax exceeding 50,000 monthly calculation indicators (KZT 196.6 million) by an organisation, provided that the amount of tax assessed based on the results of a tax audit for one calendar year of the audited period exceeds 10% of the total taxes calculated by the taxpayer for that calendar year;
  • the issue of fictitious invoices by an organisation causing:
    • damage to a citizen in the amount of more than 2,000 monthly calculated indicators (KZT 7.864 million); and/or
    • damage to an enterprise or the state in the amount of more than 20,000 monthly calculated indicators (KZT 78.64 million); and
  • evasion of tax exceeding 20,000 monthly calculation indicators (KZT 78.64 million) by a citizen.

The measure of criminal liability is general and is not exclusive to specific types of taxpayers.

Kazakhstan - GRATA International
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No.

Kazakhstan - GRATA International
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A taxpayer can submit an additional declaration to make changes and additions to the primary declaration. If the taxpayer rectifies violations and errors by submitting an additional declaration and pays the outstanding amounts of taxes and penalties, it will be exempt from administrative or criminal liability. However, the taxpayer cannot rectify violations by submitting an additional declaration after an investigation has commenced.

The right to submit an additional declaration is available to any taxpayer and for any type of tax and payment.

Kazakhstan - GRATA International
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The appeal process consists of two stages: pre-judicial review and judicial review of the tax dispute.

In case of disagreement with the results of an investigation, the taxpayer can appeal to the Appeals Commission of the Ministry of Finance. The Appeals Commission consists of the chairman and eight members. Based on its review of the appealed issues, the commission may:

  • leave the contested notice of the investigation results unchanged and the complaint unsatisfied; or
  • cancel the contested notice of the investigation results in whole or in part.

If it is dissatisfied with this decision, the taxpayer has the right to appeal to the administrative courts, which consist of three levels:

  • the first instance;
  • the appellate instance; and
  • the cassation instance.

Currently and until 1 July 2025, the functions of the cassation instance are performed by the Supreme Court. According to legislative amendments, cassation courts will be established, and the Supreme Court will be entrusted with the functions of reviewing judicial acts that have entered into legal force in exceptional cases after their consideration in the cassation instance.

This procedure for reviewing tax disputes does not depend on the choice of the taxpayer.

Kazakhstan - GRATA International
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When appealing to the Appeals Commission, the fact finders are the chairman and the eight members of the commission. The commission’s decision on the complaint is made through open vote by a simple majority of the votes of those present at the meeting.

When appealing in court, the fact finder is the judge, whose procedural task is to:

  • hear and examine the evidence presented by both the taxpayer and the tax authority;
  • assess its reliability; and
  • issue a decision based on this assessment.

Kazakhstan - GRATA International
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The limitation period for filing a tax dispute with the Appeals Commission is three months from the date of delivery of the act (notification) issued to the taxpayer as a result of the tax investigation.

If the taxpayer disagrees with the decision of the Appeals Commission, it can appeal to the administrative court with a claim against the result of the tax investigation within 30 days of delivery of the commission’s decision.

If the taxpayer disagrees with the decision of the first-instance court, it can appeal to the appellate court by submitting an appeal complaint within two months of finalisation of the first-instance court’s decision. The decision of the appellate court can be challenged by submitting a cassation complaint within one month (6 months effective 1 July 2025) of delivery of the appellate court’s judgment in its final form.

Kazakhstan - GRATA International
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The claim must be filed in court in written form or in the form of an electronic document authenticated by the electronic digital signature of the plaintiff and/or its representative.

A complaint filed with the Appeals Commission must contain the following information:

  • the name of the authority considering the complaint;
  • the full name, individual identification number (if available) and postal address of the individual taxpayer or the name, postal address and business identification number of the legal entity taxpayer;
  • the residential address of the individual or the location of the legal entity;
  • the name of the administrative authority or official whose administrative action (or inaction) is being challenged;
  • the circumstances on which the taxpayer bases its claims and evidence;
  • the date of filing of the complaint;
  • the signature of the taxpayer;
  • a list of documents attached to the complaint; and
  • other information.

A lawsuit filed in an administrative court must contain the following information:

  • the name of the court to which the lawsuit is submitted;
  • where the plaintiff is an individual:
    • his or her full name;
    • his or her place of residence;
    • his or her date and place of birth;
    • the name and address of his or her representative, if the lawsuit is filed by a representative; and
    • the phone numbers and email addresses of the plaintiff and his or her representative;
  • where the plaintiff is a legal entity or another organisation, its:
    • name;
    • location;
    • business identification number; and
    • bank details;
  • the name and (if known to the plaintiff) contact information of the defendant;
  • the content of the claim (the subject of the lawsuit);
  • the circumstances on which the plaintiff’s claim is based (the grounds of the lawsuit – that is, the essence of the violation or threat to violate the rights, freedoms and legitimate interests of the plaintiff);
  • information on compliance with pre-trial procedures for contacting the defendant; and
  • a list of documents and other attached materials (if available).

Kazakhstan - GRATA International
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Appeal against the results of an inspection must be submitted to the Appeals Commission within three months of the date of delivery of the notification issued to the taxpayer as a result of the tax investigation.

The complaint must:

  • specify the violations of the tax authority with reference to the specific provisions of tax law that have been violated, together with the facts of the case;
  • include materials confirming the violations committed by the tax authority, attached to the complaint; and
  • be signed by the taxpayer or by a person acting as the taxpayer’s representative.

Claims must be filed with the administrative court within one month of the date of receipt of the Appeals Commission’s decision.

Copies of the claim and all attached documents, a power of attorney and documents confirming payment of the state fee must be attached to the claim.

On filing of the claim, the case is accepted for consideration.

Kazakhstan - GRATA International
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Yes, collective proceedings are possible.

Kazakhstan - GRATA International
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No, this is not mandatory. The taxpayer can pay the assessed amounts of taxes and penalties once a final decision on the case has been issued.

Kazakhstan - GRATA International
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Upon filing a claim with the Appeals Commission or in court, enforcement of the contested part of the notification of the tax investigation is suspended from the date on which the court accepts the claim for consideration until the judicial act enters into legal force.

Kazakhstan - GRATA International
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If a decision is issued in favour of the tax authority, the taxpayer is obliged to pay penalties for the entire period during which the tax was overdue. The accrual of penalties is not suspended while the results of the investigation are being appealed.

The state does not pay penalties to the taxpayer if the taxpayer has paid the contested tax amount and a decision is issued in favour of the taxpayer.

Kazakhstan - GRATA International
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The taxpayer must provide any information requested by the Kazakh tax authorities as long as such information is related to taxation issues (unless Kazakh tax law states otherwise).

Kazakhstan - GRATA International
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The Kazakh tax authorities are entitled to request information on the taxpayer from:

  • counterparties of the taxpayer;
  • Kazakh banks; and
  • Kazakh state authorities.

Kazakhstan - GRATA International
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Kazakh law recognises attorney-client privilege.

Kazakhstan - GRATA International
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In tax disputes, the permissible types of evidence include various types of documents and statements.

The main types of evidence include:

  • written evidence, such as agreements, invoices, bills of lading and other primary documentation;
  • digital documents and files;
  • witness statements (eg, statements of employees of the company who are responsible for tax reporting and accounting);
  • expert opinions;
  • tangible evidence related to the case (eg, goods, products, equipment); and
  • photographs and videos.

All evidence must be duly formalised and comply with the procedural legislative requirements in order to be admissible in court.

Kazakhstan - GRATA International
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In Kazakhstan, the applicable standard of proof includes the following criteria:

  • The evidence must be obtained in accordance with Kazakh civil procedural law;
  • The evidence must relate to the dispute in question;
  • The evidence must be authentic; and
  • The evidence must be sufficient.

Kazakhstan - GRATA International
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In tax disputes which are not heard in court, the burden of proof rests with the tax authorities.

In tax disputes which are heard in court, the burden of proof also generally rests with the tax authorities, except for the following cases:

  • In a claim concerning the issue of a favourable administrative act or the performance of a favourable action, the burden of proving this rests with the taxpayer; and
  • In a claim concerning the existence or non-existence of a specific legal relationship, the burden of proving this rests with the taxpayer.

Kazakhstan - GRATA International
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Tax proceedings are generally public. A party may petition for private tax proceedings if they involve commercial secrets.

Kazakhstan - GRATA International
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  • Initiation of the proceedings: The claimant files an administrative claim with the administrative court. The administrative claim must include details of:
    • the parties;
    • the dispute;
    • the evidence; and
    • the demands.
  • Acceptance and preparation for hearing: The court assesses the administrative claim to ensure compliance with all formal requirements. The court is entitled to request the parties to provide additional documents or information as well as a written objection from the defendant.
  • Preliminary hearing: A preliminary hearing is conducted in order to:
    • clarify the issues of the case;
    • determine the need for additional evidence; and
    • schedule the main hearing.
  • At this stage, the parties may attempt reconciliation.
  • Main hearing: At the main hearing:
    • both parties present their arguments and evidence and call witnesses (if required); and
    • the court examines all evidence, hears the statements and may request expert opinions.
  • Decision: The court issues its decision after considering all evidence and arguments. The decision is based on the facts and applicability of the respective legislation. The court’s decision may include:
    • resolution of tax dispute;
    • a decision on judicial expenses; and
    • other required measures.
  • Enforcement of the decision: The losing party must execute the court’s decision – for instance, by paying the accrued amounts of taxes and late payment interest if the court rules in favour of the tax authorities. The tax authorities are entitled to enforce the tax payment if the taxpayer fails to execute the decision voluntarily.

Kazakhstan - GRATA International
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Administrative cases are heard within three months of the date of filing of the claim.

In very complicated cases, this period may be extended by a further three months.

Kazakhstan - GRATA International
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The parties are entitled to settle fully or partially at each stage of the proceedings before the court issues its decision through:

  • a settlement agreement;
  • mediation; or
  • a participation procedure.

Kazakhstan - GRATA International
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The courts play an active role in the proceedings. This means that the court is not limited by the evidence of the parties and may collect evidence by itself.

Kazakhstan - GRATA International
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The following remedies are available in tax disputes in Kazakhstan:

  • annulment of an unfavourable administrative act;
  • an order to undertake a specific administrative act or perform certain actions;
  • recognition of the existence or non-existence of a specific legal relationship; and
  • reimbursement of losses.

Kazakhstan - GRATA International
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The nature of the violation and the claim.

Kazakhstan - GRATA International
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If a party is dissatisfied with the court’s decision, it may file an appeal with the second-instance court within two months of the date of issue of the decision. The Prosecutor’s Office is also entitled to file an appeal against the decision of the first-instance court.

The appeal court will consider the case on the basis of the arguments and evidence provided in the first-instance court, but it may also consider additional evidence if deemed necessary.

The appeal decision takes effect on the date of its announcement – that is, it becomes mandatory.

The parties may request a further cassational appeal before the Supreme Court. The cassational appeal must be filed within one month (6 months effective 1 July 2025) of the date on which the second-instance court issues its decision.

Kazakhstan - GRATA International
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The filing of a claim with the court requires the payment of state duty at the following rates:

  • 0.3 monthly calculation indicators (KZT 1179,6) for claims of individuals against unlawful actions (or failures to act) and decisions of state authorities and their officials;
  • 5 monthly calculation indicators (KZT 19,660) for claims of legal entities against unlawful actions (or failure to act) and decisions of state authorities and their officials;
  • 0.1% of the disputed amount of taxes, customs duties and payments to the budget, including late payment interest, but no more than 500 monthly calculation indicators (KZT 1.966 million) for claims of individual entrepreneurs and agricultural entities against notifications on audits and/or horizontal monitoring;
  • 1% of the disputed amount of taxes, customs duties and payments to the budget, including late payment interest, but no more than 20,000 monthly calculation indicators (KZT 78.64 million) for claims of legal entities against notifications of audits and/or horizontal monitoring;
  • 0.5 monthly calculation indicators (KZT 1,966) for claims under special proceedings; and
  • 50% of the respective fee for appeals against the annulment of decisions of arbitral tribunals and foreign courts.

The losing party must reimburse the expenses of the winning party, except in case of its:

  • violation of the pre-trial procedure; or
  • abuse of rights or obligations.

Kazakhstan - GRATA International
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Yes, this is common practice.

Kazakhstan - GRATA International
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Yes; however, such funding must be properly formalised (eg, through an agreement and confirmation of payment).

Kazakhstan - GRATA International
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Kazakhstan implements advance pricing agreements, but only with taxpayers.

All of Kazakhstan’s double tax treaties provide for a mutual agreement procedure.

The decisions of foreign arbitration courts are recognised and enforced by the Kazakh courts in accordance with:

  • the New York Convention 1958;
  • the European Convention 1961; and
  • Kazakh civil procedural law.

Kazakhstan has also ratified the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States 1965. However, only eight double tax treaties of Kazakhstan provide for arbitration.

Kazakhstan - GRATA International
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Yes, Kazakhstan implements OECD minimum standards with respect to international tax dispute resolution.

Kazakhstan - GRATA International
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No, it mostly follows Article 25 of the OECD Model Tax Convention (including commentary), with the following exceptions:

  • Almost 15% of Kazakhstan’s double tax treaties do not specify time limits for transfer pricing adjustments and the implementation of mutual agreements without adherence to domestic law time limits; and
  • Almost 18% of Kazakhstan’s double tax treaties do not provide for consultation between tax authorities on tax issues not covered by such treaties.

Kazakhstan - GRATA International
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The resolution of tax disputes generally begins with the application of the domestic mechanisms. Taxpayers are entitled to apply first to the Ministry of Finance and then to the courts.

If these measures are unsuccessful and the dispute concerns international matters (eg, double tax treaty issues), the taxpayer is entitled to apply a mutual agreement procedure.

Taxpayers are entitled to apply both domestic and international tax dispute resolution mechanisms simultaneously. For instance, if a court issues a decision in a tax dispute, it is still possible to implement a mutual agreement procedure.

Kazakhstan - GRATA International
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In practice, unfortunately, the Kazakh tax authorities have adopted a formal and sometimes aggressive approach to tax control, which leads to many tax disputes. As a result, many taxpayers turn to the courts to protect their rights and interests.

The administrative courts began functioning in mid-2021, following the enactment of the Administrative Procedure Code. These courts have jurisdiction over disputes between state authorities and private entities, including disputes between tax authorities and taxpayers. The establishment of the administrative courts has had a positive impact on judicial practice in tax disputes – particularly in terms of:

  • the quality of proceedings; and
  • an increase in the number of decisions in favour of taxpayers.

The Kazakh government is currently drafting a new Tax Code. Under the new Tax Code, tax administration and control regulations will be amended to make them fully digitalised. Reforms relating to administrative proceedings are not envisaged.

Kazakhstan - GRATA International
Answer...

The main recommendation is to prevent a dispute from arising in the first place. Taxpayers should take an active position from the very beginning of a tax audit, by:

  • providing all requested documents and information relating to the subject of the dispute;
  • giving explanations to the tax officer on the subject matter of the audit;
  • maintaining regular communication with the tax officer to clarify any arising issues;
  • documenting all interactions with the tax officer, including requests and responses; and
  • providing all additional evidence and arguments in case of any doubts of the tax officer.

This will help to address the tax officer’s questions and concerns during the tax control process.

If the case does come to court, along with the evidence relating to the disputed issue, we also recommend demonstrating to the court that the taxpayer carries out its activities in good faith.

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