Tax optimization is an important aspect of the financial strategy of any business, regardless of its size. It can help reduce a company's tax liability and increase its profitability. In this post, we will look at seven main ways to significantly save on tax payments without violating the domestic tax legislation of the Republic of Kazakhstan.

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1. Use of tax incentives

One of the main methods of tax optimization is the use of tax incentives provided by the state. In Kazakhstan, there are many tax incentives for certain sectors of the economy, as well as for small, medium and even large businesses. For example, small and medium-sized enterprises can enjoy benefits on income tax, land and property taxes and other taxes. Business owners can also receive tax incentives based on investments in certain projects or sectors of the economy. Participation in one of the 13 special economic zones or 36 industrial zones located on the territory of the Republic of Kazakhstan can help large businesses significantly reduce tax payments in a legal way.

2. Choosing the right tax regime

This method is relevant primarily for small businesses in Kazakhstan, where business owners can choose a generally established or special tax regime, depending on the type of activity, expenses and income. The most popular choice for a small business owner in Kazakhstan is to work as an individual entrepreneur (IE), which allows you to reduce income tax to 1-3%. At the same time, how effective such a choice will be depends on the ratio of gross profit to business costs.

3. Use of external and internal offshore zones

Offshore zones are territories where special tax regimes operate. In Kazakhstan, there is the possibility of using offshore zones to reduce the tax burden. Moreover, there are two essentially home-grown offshore zones in Kazakhstan - the Astana International Financial Center (AIFC) and the Astana Hub. The UAE zones - DIFC, DMCC and RAKEZ - traditionally are the international offshore zones with the least degree of "allergy" on the part of the Kazakh authorities. However, to use this method, it is necessary to have a good knowledge of tax laws and procedures.

4. Application of tax schemes

One of the most common methods of tax optimization is the use of tax schemes. Tax schemes are structures that reduce tax payments using various legal and accounting techniques. Such schemes include the transfer of part of business processes to outsourcing, the replacement of one form of contracts with another, the division of financial flows, etc. However, in Kazakhstan, the use of tax schemes can lead to negative consequences, including fines and criminal liability. Therefore, before using tax schemes, it is necessary to consult with experienced tax consultants and lawyers.

5. Use of tax depreciation write-offs

Another method of tax optimization is the use of tax depreciation write-offs. This method allows business owners to reduce tax payments by using depreciation allowances based on the value of property used in manufacturing or business. In Kazakhstan, there are a number of rules and restrictions on the use of tax depreciation write-offs that must be taken into account when applying this method.

Conclusion

Tax optimization is an important tool for business owners to reduce tax payments and increase profits. However, the use of tax optimization should be carried out exclusively within the framework of legality and ethics. It is important to understand that the use of tax optimization should not be contrary to the law, and business owners should be prepared for possible audits by the tax authorities.