How VAT (НДС) Reporting Works in Kazakhstan: A Complete Guide

How VAT (НДС) Reporting Works in Kazakhstan: A Complete Guide

Value Added Tax (VAT), known locally as НДС, is one of the key indirect taxes in Kazakhstan. The system is built around electronic reporting, mandatory e-invoicing, quarterly filing, and strict documentation requirements. This article provides a clear and structured overview of how VAT works today and what businesses must prepare until the 2026 reforms come into force.

Kazakhstan is preparing major reforms to its VAT (НДС) system starting from 2026 as part of a wider modernization of tax administration and efforts to simplify compliance. The government has announced a transition toward a more automated, risk-based and transparent VAT model, which includes:

• Restructuring the VAT refund process with deeper integration into digital analytics and reduced manual intervention.
• Enhancing the risk-management system to detect fraudulent invoices, abnormal VAT credit claims, and artificial exporters.
• Expanding the functionality of e-invoicing and the Virtual Warehouse (VW) system to improve traceability of goods.
• Potential adjustments to VAT rates and thresholds, depending on economic and budgetary policy discussions in late 2025.
• Further digitalization, including broader use of real-time data from the national electronic tax platform.
• Possible introduction of SAF-T or similar standardized audit files, aligning Kazakhstan with OECD tax data standards.

These measures are aimed at creating a more predictable and automated VAT environment, reducing administrative burden for compliant taxpayers while tightening control over high-risk sectors.

With these changes on the horizon, understanding how the current VAT system works is essential.

1. VAT Rates and Scope

• The standard VAT rate in Kazakhstan is 12%. It is planned to be increased to 16 % from January 1^st 2026.
• A 0% rate applies to export operations and certain international services.
• Some goods and services are exempt, such as financial services, education, and residential real estate.

VAT applies to the supply of goods and services in Kazakhstan, imports, and certain cross-border digital services.

2. VAT Registration

Businesses must register for VAT when their turnover exceeds a legally defined threshold (linked to the Monthly Calculation Index — MCI). Voluntary registration is also possible.

Old registration threshold: 20,000 MCI (Approx. €125,100)
New threshold from 2026: 10,000 MCI (Approx. €62,550)

Key aspects:

• After registration, companies must issue electronic invoices (e-invoices) using Kazakhstan’s electronic invoicing system.
• Certain goods must also be tracked through the Virtual Warehouse (VW) module before an e-invoice can be legally issued.
• TIN (Tax Identification Number) details of both supplier and buyer must be included.

3. VAT Period, Filing, and Payment Deadlines

Kazakhstan uses a quarterly VAT reporting period.

• VAT return filing deadline: the 15th day of the second month after the end of the quarter.
• VAT payment deadline: the 25th day of the second month after the quarter.
• VAT reporting is strictly electronic.

4. VAT Invoicing Rules

VAT invoices are issued exclusively in electronic form.

Mandatory invoice data includes:

• Invoice date and number
• Supplier and buyer details
• VAT rate and amount
• Description of goods/services
• Currency and exchange rate (if applicable)

Issuing deadlines:

• E-invoices must be issued within 15 calendar days of the supply.

Virtual Warehouse Requirements:

Certain categories of goods cannot be sold unless they are recorded in the VW module.

5. VAT on Imports and Exports

Imports

• Imports are subject to 12% VAT, normally paid during customs clearance.
• Input VAT can typically be claimed if related to taxable operations.

Exports

• Exports are zero-rated.
• Exporters may claim VAT refunds, provided documentation is complete and electronically traceable.

6. VAT Rules for Digital Services and E-Commerce

Foreign suppliers of digital services to consumers in Kazakhstan must:

• Register for VAT (even without local presence)
• Pay VAT quarterly
• Convert foreign-currency payments using the National Bank’s official rate
• File simplified VAT reports electronically

Foreign suppliers do not issue Kazakh e-invoices and generally cannot claim input VAT.

7. VAT Credits and Refunds

Businesses may deduct input VAT on purchases used for taxable supplies.
Rules:

• E-invoice from a VAT-registered supplier is required.
• Input VAT related to exempt or non-business activities is not deductible.
• VAT refunds (mainly for exporters) require thorough documentation and undergo risk-based checks.

8. Common VAT Compliance Issues

1. Incorrect e-invoices or missed deadlines
2. Virtual Warehouse mismatches
3. Incorrect VAT rate or classification
4. Currency conversion errors
5. Documentation gaps in VAT refund claims
6. Incorrect treatment of imports or digital services

9. Practical Tips for Businesses

• Maintain accurate and timely e-invoices.
• Ensure goods subject to virtual warehouse rules are properly recorded.
• Monitor exchange rates and conversions.
• Verify suppliers’ VAT status and invoice compliance.
• Prepare strong documentation for any VAT refund claims.
• Start preparing early for the 2026 VAT reforms, especially regarding digital data requirements.

Conclusion

Kazakhstan’s VAT system is already highly digitalized, centered around e-invoicing, virtual warehouse controls, and systematic quarterly reporting. The upcoming 2026 reforms will intensify digitalization, strengthen risk-based VAT control, and streamline refund processes. Companies operating in Kazakhstan should familiarize themselves with both the current rules and the expected future changes to ensure smooth compliance.