Baker Tilly in Kazakhstan: 5 years of sustainable growth
Baker Tilly Qazaqstan Advisory LLP has become a full member of the AIFC friendly ecosystem and provides qualified support to clients under this jurisdiction. Join us at AIFC!
Three years ago, the capital of Kazakhstan - Nursultan has become a center for investment opportunities in the Central Asian region in addition to the other financial capitals of the world such as London, New York, Hong Kong and Dubai. Now the Astana International Financial Center (AIFC) and Astana Hub International Innovation Technology Park (Technopark) are functioning here, which are the main accelerators of economic and technological growth in the region.
Increasing attention to the activities of the financial center, a favorable tax regime, stock exchange infrastructure and other opportunities provided by the International Financial Center Astana (AIFC), has caused interest in consulting business for many companies. Our company is not an exception, currently Baker Tilly Qazaqstan Advisory LLP has obtained a license to provide ancillary services (Ancillary Services). Within the framework of this license, we are providing:
Consulting services, which include a variety of services to provide expertise or advice in different areas, including valuation services, preparation of business plans, feasibility studies, marketing and sociological research (market / industry / assortment / consumer / competitive analysis)
Tax consulting and tax reviews, legal services, accounting outsourcing, implementation of digital accounting solutions (SAP, 1 C, IBP, RPA and others) and other consulting services.
In 2021, Baker Tilly's practice in Kazakhstan turned 5 years old, and in the short period of time we have managed to win a reputation of a trustworthy player who promptly completes complex orders.
2021 was a special year for us, as Baker Tilly was included in the list of audit organizations recognized by KASE. Our company became the first audit organization to be accredited online in the new specialized electronic document management system of KASE.
Established on the territory of Astana Expo and embodying the best practices of the world's financial and technological centers, AIFC and Technopark Kazakhstan offer an exceptionally attractive climate for business, both domestic and foreign. So, what awaits the residents of AIFC and Technopark in Nursultan:
Anglo-Saxon legal regime (British jurisdiction)
Simplified visa and labour regimes
Attractive tax regime.
In this article we would like to talk about: who, how, when and what benefits companies that will become participants in the AIFC and Technopark ecosystem can enjoy.
It is possible to become a participant of AIFC by establishing a new legal entity registered under AIFC law, or by accrediting a legal entity registered in another jurisdiction to AIFC. Foreign companies can become participants.
So, what tax benefits does an AIFC and Technopark participant receive?
A brief explanation of the tax benefits is set out below:
AIFC participants are exempt from CIT and VAT on revenues from the sale of financial services if only the services are provided within the AIFC (e.g., Islamic banking, reinsurance and insurance brokerage services, investment fund asset management services, broker-dealer, underwriting services and so on). This means that an AIFC participant needs to have a physical presence as well as the necessary resources as a proof of service delivery in the center.
AIFC participants providing legal, audit, accounting, consulting services are exempt from CIT if the services were provided to AIFC bodies and participants providing the abovementioned financial services. Participants of the Center can provide services both on the territory of AIFC and outside of it. However, in this case, it is mandatory to keep separate records of income subject to tax exemption and taxable income, as well as expenses subject to deductions. In some cases, the Participants of the Center are also exempt from property tax and land tax on objects located on the territory of the Center.
Astana Hub has equally favorable tax incentives including, in addition to the above-mentioned CIT and VAT incentives, individual income tax, social taxes and other taxes and deductions related to employee income.
But in order to apply tax incentives, it is necessary to comply with the conditions stipulated by Article 293 of the Tax Code of the Republic of Kazakhstan. For example, for goods produced and sold by members of the Astana Hub, it is required to have a certificate confirming the country of origin of goods or a certificate confirming the presence of the applicant in the register of domestic producers of goods, works and services. The procedure for acquiring this certificate is specified in the Rules and is carried out online.
Baker Tilly is one of the top 10 largest consulting companies in the world with a total turnover of about $4 billion in 2020. The total turnover is about $4 billion in 2020, an increase of 5%. The total number of employees has increased to 37 000 people. Baker Tilly experts provide services in 740 offices in more than 148 countries around the world. We audit, evaluate and develop Business Plans for the purposes of attracting financing from major financial institutions, carry out feasibility studies of projects, do marketing study of projects and strategic consulting, carry out tax reviews and due diligence (financial, tax, commercial, etc.), as well as provide services in the field of accounting outsourcing.
Baker Tilly in Kazakhstan is a full member of the AIFC and an official provider of valuation services to KMG and other private, state/quasi-state companies in Kazakhstan. Our clients are representatives of oil and gas and mining industries, heavy and light industry, logistics, agrarian sector and representatives of Natural Monopoly Entities sector.
Elena Khegay, director of Tax and Accounting consulting at Baker Tilly Qazaqstan Advisory
Togzhan Aytmukhametkyzy, director of Branch Baker Tilly Qazaqstan Advisory, member of AIFC
Asel Mukhamejanova, tax consultant of Baker Tilly Qazaqstan Advisory
Togzhan Aytmukhametkyzy, director of Baker Tilly Qazaqstan Advisory Branch in the AIFC
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