Have you registered a business or branch of your business in Kazakhstan? Do you continue to incur head office and management costs elsewhere?
If your charges aren’t fully substantiated, you run the risk of them being disallowed by local tax authorities. So act now to ensure that your records are up to scratch.
Anything you charge to your Kazakhstan business needs to be reasonable and objectively justifiable. For example, you may decide to charge out your head office costs in proportion to the turnover of each of your businesses. Alternatively, you might allocate costs according to the time your management team spend working on your Kazakhstan business.
However you decide to allocate your central costs, you’ll need evidence to support these charges. Typically this could include copy invoices, head office accounts, business-wide sales figures or senior management timesheets.
Remember that without evidence to support your management charges, there is a a risk that the costs will be disallowed and higher taxes plus penalties will apply. In certain circumstances, the authorities can give notice of their intention to freeze your local bank accounts.
Of course there’s no reason for any of these problems to arise – it’s always best to get it right from the start.
The above information is for general purposes only and is not intended and should not be construed as legal, accounting or tax advice. The content may not be applicable or suitable for every individual’s particular circumstances and should not be used as a substitute for consultation for professional advice on tax or accounting matters.
Disclaimer: This blog is provided for information purposes only. We accept no responsibility for any losses arising from any action you take or do not take as result of this information. If you require specific advice, please contact us and we will be happy to help.