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Rental income from land and property, less tax-deductible expenses, is subject to corporate income tax at the standard corporate tax rate of 20%. Permanent establishments of foreign legal entities are subject to virtually the same taxation regime as resident entities. The difference is that branches are subject to a tax on the net income of a branch at a rate of 15% (‘branch profit tax’) of the after-tax profit (i.e. the effective tax rate will be 32%), while the profits derived through the local company would be subject only to tax at the level of legal entity at the rate of 20%. These profits will be subject to a 15% withholding tax on the distributed dividend paid to non-residents (unless exempt under domestic law). Tax will be levied at the moment of distribution of dividend, rather than at the moment when the profit was made. At the same time, these tax rates are reducible to 5% or 10% under most double tax treaties. Please note that most of the double tax treaties provide an opportunity to reduce the rate of the branch profit tax mentioned above. As of 1 June 2012, Kazakhstan has 42 double tax treaties in force.
Usually, all expenses incurred by legal entities and entrepreneurs in connection with the earning of aggregate annual income are deductible, with certain exceptions and limitations.
Source : PWC
