Kazakhstan will impose a limit on mobile transfers to prevent tax audits.
The discussion surrounding the use of mobile transfers for payments for goods and services has intensified again in Kazakhstan. Following the cancellation of the fourth stage of mandatory declaration, some entrepreneurs have resumed actively accepting transfers from clients. The Committee for State Revenues (KGD) stated that they plan to revise the analysis criteria to consider not only the number of mobile transfers but also their total volume, as reported by inbusiness.kz.
The KGD reminded that second-tier banks are required to record transactions in personal accounts if they meet criteria indicating entrepreneurial activity.
100 senders and 255,000 tenge
One such criterion is the receipt of funds from 100 or more different senders over three consecutive months into a personal account not designated for business.
"Banks provide data in stages. In 2023, this concerns government employees and their spouses; in 2024, it will include employees of the quasi-public sector, and starting in 2025, individual entrepreneurs and heads of legal entities will be included. A complete population coverage is planned for 2026," – the KGD explained.
Unfortunately, the KGD is currently unable to determine the number of entrepreneurs evading taxes using mobile transfers. Complete information from banks will only be available in 2025.
It is worth noting that those attempting to earn money outside the law face financial penalties. For engaging in entrepreneurial activities without registration, a fine of 15 MRP is imposed, and for repeated violations, it is 30 MRP (Article 463 of the Administrative Code). Tax evasion results in a fine of 200% of the tax amount, with repeat offenses attracting a 300% fine (Article 275 of the Administrative Code).
Failure to issue a receipt results in a warning for the first instance, and a fine of 30 to 40 MRP for subsequent violations (Article 284 of the Administrative Code). Additionally, violations of the law may lead to account freezes.
"When a violation is detected, a notice is issued. A 30-day period is given for correction by submitting additional tax reporting forms or providing explanations. If there is no response or action from the taxpayer by the end of the notification period, the next step is account blocking," – the KGD clarified.
Will the criteria change?
Currently, the KGD is working on the issue of amending the analysis criteria.
For instance, it is proposed to consider not only the number of senders but also the total amount of receipts.
"The following revision of the criterion is under consideration: receiving funds into a bank account by one individual from 100 or more different persons monthly over three consecutive months, with a total amount exceeding 3 MZP (as of January 1, 2024, – 255,000 tenge)," – reported representatives of the state body.
This will allow for the exclusion from analysis of those who are not required to register as individual entrepreneurs, such as private individuals with small incomes.
When the new changes will come into effect remains unknown. However, it is expected that control will only tighten over the years. The use of mobile transfers without tax payment significantly harms the state budget. The reporting system will help bring illegal income into the light while maintaining transparent conditions for honest entrepreneurs.