of January 8, 2014 No. NK-21/34-I
Tax departments on
to areas, Astana and Almaty
Management of multimedia communication
on explanation of the tax legislation
Tax department on the city of Astana
The Tax Committee of the Ministry of Finance of the Republic of Kazakhstan in connection with changes and additions in the Tax code made by the Law of the Republic of Kazakhstan of December 5, 2013 No. 152-V "About modification and amendments to some legal acts of the Republic of Kazakhstan on the tax matters" (further - the Law), informs the following.
1. On the corporate income tax
1.1 Changes are made to article 147 of the Tax Code according to which the budget subsidies in the directions established in this Article provided to legal entities - to producers of agricultural products, products of beekeeping, products of aquaculture (fish breeding), are recognized income gained from implementation of activities for production of agricultural products, products of beekeeping, products of aquaculture (fish breeding), conversion and realization of the specified self-produced products, that is the income in type of such subsidies is subject to taxation at the rate of 10%. This regulation becomes effective since January 1, 2009.
1.2 The law provides exception of the Tax code of Article 79 and transfer of procedure for the taxation of long-term contracts in the fourth Section of the Tax code "Corporate income tax".
So, by the actual method of determination of the income according to the long-term contract - regulations that the income which is subject to obtaining (received) for accounting tax period, is recognized the amount at least expense amounts suffered for such period according to the long-term contract are kept.
At the same time, since January 1, 2014 if for the previous tax periods the total of income according to the long-term contract for the purposes of the taxation exceeds the total of income under such contract determined in financial accounting, the taxpayers applying the actual method having the right to reduce the income according to the long-term contract for the purposes of the taxation for accounting tax period by the amount of such excess up to the size at least expense amount attributable to deductions under such contract for tax period.
Thus, the taxpayers applying the actual method are given opportunity in the last year of action of the long-term contract to make adjustment of the income towards reduction if the long-term contract actually is unprofitable.
By completion method - for simplification of application the formula of determination of share of execution of the long-term contract is entered.
1.3 The law enters regulations on the taxation of the insurance, reinsurance organizations which become effective since January 1, 2012.
So, it is specified that insurance companies can perform deduction of expenses on reserve of not earned premiums, reserve of not occurred losses, reserve of the declared, but not settled losses.
Besides, the procedure for recognition of the income and deduction is determined by the reinsurance assets created on not earned premiums, not event to losses, declared, but not settled losses.
Also for the purpose of establishment of transitional provisions are provided procedure:
determinations of the income in type of insurance premiums and deductions under the agreements of accumulative insurance, reinsurance, agreements of not accumulative insurance, life reinsurance which entered about force till January 1, 2012;
determinations of original cost of the fixed assets of the insurance, reinsurance organization for January 1, 2012.
1.4 The law makes changes to Item 14 of article 119 of the Tax Code according to which in case of the temporary termination of use of the fixed assets of the I group, used in seasonal production, reduction of cost balances of subgroups will not be is made. At the same time definition of concept of the fixed assets of the I group used in seasonal production is given, namely such assets the fixed assets of the I group which at the same time correspond to the following conditions will be recognized:
such assets cannot be used by the end of the reporting period owing to the requirements specified in technical documentation on operation in certain temperature conditions;
at least three months participate in production process in connection with climatic, natural or technological conditions during the certain period of calendar year, but;
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