Kazakhstan Taxes for Small Business Under the 2026 Tax Code: 20% CIT, VAT Up to 16% With a Lower Threshold, the Simplified Return and Its New Restrictions, Payroll, Withholding on Dividends, AIFC Exemptions, and What It Means for a Pakistani-Owned LLP

Estimated reading time: 11 minutes

Kazakhstan taxes for small business are no longer the light-touch regime consultants described a year ago. A new Tax Code adopted on 18 July 2025 took effect on 1 January 2026, raising VAT, lowering the registration threshold, tightening the simplified regime and restructuring how foreign owners and employees are taxed. This guide sets out the rules as they now stand and what they mean for a Pakistani entrepreneur running or planning an LLP.

It is general information drawn from Big Four and law-firm summaries, not tax advice; rates and thresholds move with the MCI and with amendments, and a Kazakh accountant should confirm your position. Read it with our Kazakhstan business setup guide.

What changed on 1 January 2026

Kazakhstan adopted a new Tax Code on 18 July 2025 replacing the 2017 code, with most provisions effective from 1 January 2026, per Baker McKenzie. The headline changes: VAT from 12% to 16%, a halved VAT registration threshold, no CIT deduction for payments to simplified-regime taxpayers, a 25% CIT rate for banks and gambling, differentiated VAT for medicines, and a cumulative approach to personal income tax, per Baker McKenzie and PwC. Commentators describe the reform as expanding the tax and compliance burden on business well beyond the statutory rates, per Mondaq.

Corporate income tax

The standard CIT rate remains 20%; banks (except SME lending) and gambling businesses pay 25% from 2026, per Schneider Group. The list of non-deductible expenses has been clarified, and the new deduction restriction below can push the effective rate well above 20% for companies buying from small suppliers, per Mondaq.

VAT at 16% and the lower threshold

The standard VAT rate is 16% from 1 January 2026, applying to sales of goods, works and services and to imports; medicines and medical devices are at 5% (10% from 2027); imports from the EAEU are subject to 16% VAT except exempt goods; the reporting period is a calendar quarter, per PwC. Mandatory registration now applies at 10,000 MCI of annual turnover, about KZT 41.5 million, half the previous level, per Baker McKenzie; registration requires Face ID identification in person and voluntary deregistration has been abolished, per HCG. Older guides quoting 12% VAT and a KZT 20 million threshold, such as this one, are out of date.

The simplified tax return regime

Small businesses may use a special tax regime based on a simplified tax return, paying a low percentage of turnover in place of CIT and with reduced reporting, subject to turnover and headcount limits. From 2026 the government has barred 44 activities from the regime, including leasing, banking, brokerage, gambling and digital mining, per Schneider Group. Check the current rate, the turnover ceiling and the barred list with your accountant; the regime still suits many trading and service SMEs.

The deduction restriction

From 2026, companies on the general regime cannot claim CIT deductions for payments to suppliers using the simplified tax return, a measure aimed at business fragmentation but which hits legitimate SMEs, per Baker McKenzie. The practical effect for a Pakistani-owned LLP: if your customers are general-regime companies, being on the simplified regime makes you an expensive supplier, because they cannot deduct what they pay you. If your customers are consumers or other small businesses, the simplified regime still works.

Payroll taxes

• Personal income tax: 10%, with income above 8,500 MCI taxed at 15%, and a cumulative calculation approach, per PwC; foreign employees’ salaries follow the same 10%/15% split, per Leinonen.
• Social tax: reduced to 6%, no longer reduced by social contributions, per PwC.
• Pension, social and medical contributions from employer and employee at the statutory rates.
• The minimum wage from 1 January 2026 is KZT 85,000, per Schneider Group.

A Pakistani director on a work permit is on payroll and bears these; see our work permit guide.

Dividends and withholding

Dividends to non-residents owning 25% or more of a Kazakh entity are taxed at 5% up to 230,000 MCI and 15% above; withholding on loan interest and other non-resident income is being restructured, and advances to non-residents unfulfilled within twelve months become taxable income, per Leinonen. The new code also removed the condition that a related-party recipient in an MLI-amended treaty country show a 15% effective home rate to claim treaty benefits, per Baker McKenzie.

EAEU imports and e-invoicing

Imports from the EAEU are subject to 16% VAT from 2026 except exempt goods, and traced goods and their turnover are shared with EAEU states through the e-invoicing system; e-invoices are mandatory for most B2B sales with narrow exclusions, per PwC. A Pakistani trader routing goods through Kazakhstan into the EAEU must budget import VAT and run e-invoicing from day one. See our trade guide.

The AIFC regime

The Astana International Financial Centre offers participants exemptions from CIT and VAT on qualifying financial, professional and ancillary services and from personal income tax for certain employees, under English-law rules, until 2066; commentators highlight it as Kazakhstan’s distinctive advantage alongside a legitimate business environment, per TaxRatesByCountry. It is not a general-purpose tax haven; the activity must qualify. See our AIFC guide.

Double taxation with Pakistan

Pakistan and Kazakhstan have a double taxation agreement covering income taxes, dividends, interest and royalties; treaty rates and residence tie-breakers apply, and the 2026 code’s removal of the effective-rate condition simplifies claiming benefits, per Baker McKenzie. A Pakistani owner should obtain a tax residency certificate from FBR to claim treaty rates on dividends.

Choosing a regime for a Pakistani-owned LLP

• Simplified return: if turnover and headcount are within limits, the activity is not barred, and customers are consumers or small businesses.
• General regime: if customers are general-regime companies who need deductions, or turnover will exceed the simplified ceiling; expect 20% CIT and VAT at 16% once above 10,000 MCI.
• AIFC: if the activity is financial, professional or fintech and can be structured to qualify.

Decide before the first invoice; switching later is possible but disruptive.

Compliance calendar

• VAT returns quarterly.
• Payroll taxes and contributions monthly.
• CIT advance payments and annual return per the code’s deadlines.
• E-invoicing continuously.
• Large-taxpayer monitoring applies only to 524 listed taxpayers from 2026, per Schneider Group; SMEs are outside it.

Kazakhstan vs Uzbekistan on tax

Uzbekistan has kept CIT at 15% and VAT at 12% while Kazakhstan moved to 16% VAT and tightened deductions, which commentators note makes Uzbekistan the more business-friendly tax environment in 2026 even though Kazakhstan remains the larger economy with more accumulated investment, per Mondaq. Kazakhstan’s counterweights are EAEU access and the AIFC. See our Uzbekistan tax guide and best country guide.

Bottom line

Kazakhstan taxes for small business in 2026 mean 20% CIT, 16% VAT above a halved threshold, a simplified regime that survives but with barred activities and a deduction penalty for your general-regime customers, 10–15% payroll tax with 6% social tax, and 5–15% withholding on dividends to a Pakistani owner. Choose the regime by who your customers are, run e-invoicing from the first sale, claim treaty rates with an FBR certificate, and look at the AIFC only if the activity qualifies.