Tax Law Zhanat Alimanov, assistant professor. Home assignment (2-3 per day) Calculate tax burden of the company on Volodya’s income: under (1) Labor

Tax Law

Zhanat Alimanov, assistant professor

Home assignment (2-3 per day)

Calculate tax burden of the company on Volodya’s income: under (1) Labor Law, (2) Civil Law (not IE), & (3) Civil law (IE):

1. Salary is KZT 150,000 a month2. Salary is KZT 230,000 a month3. Salary is KZT 70,000 a month4. Salary is KZT 20,000 a month5. Salary is KZT 32,000 a month6. Salary is KZT 370,000 a month7. Salary is KZT 475,000 a month8. Salary is KZT 367,000 a month

Example

Calculate tax burden of the company on Volodya’s income: under (1) Labor Law, (2) Civil Law (not IE), & (3) Civil law (IE). Salary is KZT 170,000 a month

1. Labor Law: PIT + Social Tax PIT = Taxable income * 0.1= (Total Revenue –

Deductions&Exemptions – Pension – Minimum Salary)*0.1= (170,000 - 0 – 17,000 (pension) – 19,966(minimum salary))*0.1 = 13, 303.4

Social Tax = Taxable income*0.11 = (Total revenue – deductions - Pension)*0.11=(170,000-0-17,000)*0.11= 16,830

2. Civil Law (not IE): PIT PIT = Taxable income * 0.1= (Total Revenue –

Deductions&Exemptions)*0.1= (170,000 - 0)*0.1 = 17,000

3. Civil Law (IE): no tax on company

Terms

1. Tax – налог

2. Revenue (Income) – Доход

3. Total Personal Revenue – Совокупный личный доход

4. Net Income – Чистый доход

5. Personal Income Tax – Индивидуальный подоходный налог

Plan

I. Legislation

II. Personal Income Tax & Social Tax

1. Who are taxed?2. When company has to

pay Personal Income Tax?

How to calculate PIT & Social Tax

Differences of taxation of Civil & Labour Contracts

I. Legislation

I. Legislation

Constitution & Constitutional

Statutes

Civil Code Tax CodeAdministrative

CodeOther Codes

Statutes Other acts Statutes

II. Personal Income Tax (PIT) & Social Tax

1. Who are taxed (PIT)?

Example

Let’s assume that foreigner can

own real estate in KZ.

Masha rents her apartment to

Petya for USD 300.

Does she need to pay taxes if she is:

(1) a foreign citizen;

(2) a KZ citizen;

(3) person without citizenship?

Example

Let’s assume that foreigner canown real estate in KZ.

Masha rents her apartment toPetya for USD 300.

Is she a taxpayer if she is:(1) a foreign citizen;(2) a KZ citizen;(3) person without citizenship?

Art. 153, Tax code.

2. When

COMPANY has to pay

Personal Income Tax?

Step 1: Who pays PIT?

Total Revenue

Taxed at Source (art. 160)

Not Taxed at Source (art. 177)

Company would pay PIT for Physical Person

Company would not pay PIT for Physical Person, he will

pay PIT himself

Example

Company Arico hired Volodya asaccountant for KZT 300,000 a month.

Who will pay Volodya’s PIT (Companyor Volodya)?

1. Labor Law Contract?

2. Civil Law Contract & Volodya is not IE?

3. Civil Law Contract & Volodya is Individual Entrepreneur (IE)?

3. How to calculate

PIT & Social Tax?

Step 2: How much is Tax of the Company?

Taxed at Source(art. 160 &158)

LABOR Contract CIVIL Contract

Total Revenue(Art. 160)

Total RevenueArt. 158

PIT

Minus Deductions &

Exemptions (Art. 155 & 156)

Minus Pension

& Minimum Salary (art. 166)

Social Tax

Minus Deductions (art. 155)

= Taxable Income * 0.1 (Art. 158)

Minus Pension (75) (Art. 357 (2/6)

PIT

Minus Deductions & Exemptions (Art. 155 (19-26) & 156)

= Taxable Income * 0.1 (Art. 158)

= Taxable Income * 0.11 (art. 358)

Example


Calculate Volodya’s INCOMEthat he will from company?




Example

Total revenue: KZT 300,000 a month.

LABOR LAW1. PIT = Taxable Income * 0.1 = (TotalRevenue – (1) Deductions &Exemptions – (2) Pension & Minimum

Salary) * 0.1 = (300,000 – 30,000 (pension) -

- 19,966(minimum salary))*0.1 = 25,003.4(PIT)

2. NET INCOME = Total Revenue – Pension – PIT == 300,000 – 30,000 (pension) – 25, 003.4 (PIT) == 244,996.6 (NET INCOME)

Example


CIVIL LAW (Volodya is NOT IE):

1. PIT = Taxable Income * 0.1 = (Total Revenue –

Deductions & Exemptions)* 0.1 = (300,000 – 0)*0.1 =

= 30,000

2. NET INCOME = Total Revenue – PIT =

= 300,000 – 30,000 (PIT) = 270,000 (NET INCOME)

Example


CIVIL LAW (Volodya is IE):

1. INCOME = Total Revenue = 300,000 Volodya will have to pay taxes himself

Example


Calculate Volodya’s NET INCOMEthat he will from company?

1. Labor Law Contract? 244,996.6

2. Civil Law Contract & Volodya is not IE? 270,000

3. Civil Law Contract & Volodya is Individual Entrepreneur (IE)? 300,000

Example

Company Arico hired Volodya as

accountant for KZT 300,000 a month.

Calculate how much TAX the

Company will have to pay for Volodya?




Example


LABOR LAW

1. Social Tax = (Total Revenue – Pension)*0.11 = (300,000-30,000)*0.11 = = 29,700 (Social Tax)

2. TOTAL TAX = PIT + Social Tax = 25,003.4 ++ 29,700 =

= 54,703.4 (total tax to be paid)

Example


CIVIL LAW (Volodya is NOT IE):

1. TOTAL TAX = only PIT =

= 30,000 (total tax)

Example


CIVIL LAW (Volodya is IE):

1. TAXES to be paid for Volodya =

= 0

Example


Calculate how much TAX theCompany will have to pay for Volodya?

1. Labor Law Contract? 54,703.4

2. Civil Law Contract & Volodya is

not IE? 30,0003. Civil Law Contract & Volodya is

Individual Entrepreneur (IE)? 0

Documents

Tax Law Zhanat Alimanov, assistant professor. Home assignment (2-3 per day) Calculate tax burden of the company on Volodya’s income: under (1) Labor