IE under the Simplified Taxation System in Kazakhstan in 2026

One of the most straightforward, easy, and convenient ways to run a business for an individual entrepreneur is an IE under the simplified taxation system (STS). Simply put, in this case, the business operates on a simplified tax regime. This mode minimizes the number of administrative procedures and simplifies the preparation of reporting documentation. Importantly, the entrepreneur can manage the business independently without hiring an accountant. Let's take a closer look at the nuances of the simplified taxation system.

Who is eligible for the Simplified Declaration?

Entrepreneurs can use the simplified system if their business simultaneously meets the following criteria:

• Types of activities.
  For example, entrepreneurs engaged in the sale of excisable goods, certain types of petroleum products, or in the storage and warehousing of grain are not allowed to switch to the special tax regime, also known as the simplified regime. The full list of prohibited activities for individual entrepreneurs applying the simplified regime is approved by Resolution No. 970 of the Government of the Republic of Kazakhstan.

• Annual income.
  The maximum annual turnover for an individual entrepreneur under the simplified regime in 2026 is limited to 600,000 MCI per year (in 2026 this is approximately 2.6 billion tenge).

We would like to emphasize once again that to operate under the simplified taxation system, it is necessary to meet all of the above criteria simultaneously. If a business owner does not meet at least one of the criteria, they are transferred to the general taxation regime.

What Taxes Does an Individual Entrepreneur Pay Under the Simplified Taxation System?

To understand what taxes an individual entrepreneur will pay under the simplified taxation system in Kazakhstan in 2026, it is necessary to know if they have hired employees. Let's consider both situations in detail: when the entrepreneur works alone or hires employees.

Taxes Under the Simplified Taxation System for an IE Without Employees in 2026

An entrepreneur who does not hire additional employees makes tax payments to the budget and mandatory contributions for themselves.

Payments to the budget include individual income tax (IIT) and social tax. The social tax rate is 6%. In 2026, IIT will be 10% if income is below 8,500 MCI; if it exceeds this threshold, the rate will be 15%.

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Taxes for IEs Having Hired Employees Under the Simplified Taxation System in 2026

If the entrepreneur hires specialists, the entrepreneur also makes the aforementioned payments (in his/her favor and to the budget). Additionally, the entrepreneur must make contributions for each of his/her employees:

1. From 2% to 6% - Individual income tax (IIT) 
2. 10% - Mandatory pension contributions (MPC) 
3. 5% - Social contributions 
4. 3% - Mandatory health insurance (MHI)
5. 2% - Health insurance contributions (HIC) 
6. 3,5% - EMPC 

The percentages are calculated from the salary of hired specialists. The status of the employee (pensioner, disabled, foreigner, etc.) should also be taken into account.

For information, entrepreneurs working under the simplified tax system are exempt from social tax for employees. As in the first case, payments for specialists are made every month (by the 25th day of the month following the reporting month).

Additionally, as an employer, the entrepreneur must pay employees their sick leaves, vacation or compensation if the employee does not use his/her vacation.

VAT Payment for Individual Entrepreneurs Under the Simplified Taxation System

How to Operate an IE Under the Simplified Taxation System in Kazakhstan?

This can be done in any convenient way: independently, with the help of an outsourced accountant, or an in-house accountant. Each option has its pros and cons. For example, hiring an in-house accountant is not always economically feasible (especially for small businesses). Therefore, small businesses often use outsourced accounting services.

Independent accounting involves thoroughly studying all aspects and considering many nuances. For example, let's consider how an entrepreneur can receive income and what documents they need to prepare:

1. Cash. To work with cash, an online cash register is required – a receipt must be issued to the client for each purchase.
2. Payment by bank card. An online cash register is also required in this case.
3. Transactions via the app (for example, Homebank or Kaspi). An online cash register is required here as well.
4. Transfer to the IE’s bank account. If you are paid for goods, you need to prepare an invoice, a delivery note, and electronic invoice (E-invoice). And if clients pay for services in this way, you need to issue an invoice, draw up a paper or electronic certificate of work performed (ECWP) and prepare an electronic invoice.

Is an IE under the simplified taxation system obliged to issue E-Invoices in 2026? From 1 April 2021, this document must be issued if the amount per contract with legal entities or IEs (except those using the simplified taxation system, patent) exceeds 1,000 MCIs, i.e. KZT 4,325,000.

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But that’s not all. Entrepreneurs must issue E-invoices if:

1. they are VAT payers.
2. they sell goods imported from other countries.
3. they do not pay VAT but sell goods recorded in the “Virtual Warehouse” module of the E-invoice system.
4. they provide international cargo transportation services (regardless of whether they pay VAT).

Please note that entrepreneurs from the above categories must issue E-invoices even if the contract value does not reach 1,000 MCIs.

What Reporting Do Entrepreneurs Prepare Under the Simplified Taxation System?

IEs operating under the simplified taxation system must complete Form 910.00 once every six months:

1. Based on the results of the first half of the year, the document is submitted within the period from July 1 to August 15. Also, by August 25, profit tax of 3% is to be paid.
2. For the second half of the year, the report is submitted from January 1. The deadline is February 15 of the year following the reporting year. Additionally, a 3% tax must be paid by February 25.

The form is submitted online, which saves time.

Are There Any Benefits for Individual Entrepreneurs?

The Tax Code of Kazakhstan provides benefits for entrepreneurs working under the simplified taxation system. However, these benefits apply only to those who hire specialists.

An individual entrepreneur can reduce the tax he/she pays for each employee by 1.5%. This is possible only if the employee’s salary is 25 MCIs (KZT 108,125) or exceeds this amount.

The benefit can be applied when filling out Form 910.00. The amount payable will be calculated automatically.

Note that the entrepreneur can not only rely on benefits but must also remember their obligations, including timely tax payment. Various violations are penalized with a warning (for the first time). For the second and subsequent violations, the entrepreneur faces a fine. And the amount is significant – from 15 to 50 MCIs.

The simplified tax system attracts entrepreneurs with its simplicity and clarity, allowing them to manage their accounting independently and avoid costly third-party services. However, it is crucial to be aware of all the nuances and understand the legal norms even under the simplified system. This will enable transparent and efficient business operations, taking advantage of benefits and avoiding warnings and fines.