Changes in Legislation of the Republic of Kazakhstan: Payroll and Civil Contracts (GPC) for 2026

From 2026, changes in the legislation of the Republic of Kazakhstan come into force, which concern payroll (FOT), civil contracts (GPC), personal income taxation, and social payments.

This article covers:

-personal tax deductions;
-changes in taxable income;
-progressive scale of IIT;
-social tax and mandatory pension contributions;
-mandatory social health insurance (MSHI) and social deductions.

1. Personal Tax Deductions for Individuals

Individuals are entitled to the following tax deductions:

1.1. Social Payment Tax Deduction

mandatory pension contributions (MPC);

contributions to mandatory social health insurance (CMSHI);

social deductions under civil contracts.

1.2. Basic Tax Deduction

30 times the MCI.

1.3. Social Tax Deductions

5,000 times the MCI for persons with disability groups I and II;

882 times the MCI for persons with disability group III;

deductions for a child with a disability, adoptive parents.

Important: other deductions, such as preliminary and large-family deductions, are excluded.

2. Changes in Taxable Income

The term “income adjustment” is replaced with “reduction of taxable income.”

Now subject to taxation are incomes previously not considered as individual income:

payments for medical services (DMS) up to 94 MCI;

material assistance at the birth of a child;

payments to “former” employees.

All payments related to employment, including post-termination payments, are considered employee income.

3. Calculation of IIT on a Cumulative Basis

Progressive IIT rates:

Up to 8,500 MCI per year — 10%;

Above 8,500 MCI — 15% (on the excess amount).

Example of calculation for income of 2,000 MCI per month:

Formula:
Employee income minus reduction (clause 1, art.400) minus tax deductions (clause 1, art.401):

• social payment tax deduction (MPC, CMSHI)

• basic tax deduction (30 MCI)

• social tax deductions (882 MCI, 5,000 MCI)

4. Social Tax in 2026

• The rate is reduced to 6%.
• Exclusion of reduction by the amount of social deductions.
• Calculation formula: (income - MPC - CMSHI - NON-TAXABLE) * 6%
• Minimum income threshold of 14 MCI does not apply in the month of hiring or dismissal.

5. Employer’s Mandatory Pension Contributions (EMPC)

• Rate increased from 2.5% to 3.5% (clause 1, art. 251 of the Social Code of RK).
• Minimum contribution: 2,975 KZT.
• Maximum contribution: 148,750 KZT.

6. Social Deductions

If the accrual base is less than the minimum wage, deductions are calculated based on the minimum wage.

Exceptions:

• individuals on a special tax regime for self-employed;
• income from services through online platforms;
• income under GPC with tax agents;
• unified payment under Chapter 94 of the Tax Code of RK;
• individual assistants paid by government bodies and legal entities.

7. Mandatory Social Health Insurance (MSHI)

Upper income limit for contribution calculation: 40 MZP (maximum 102,000 KZT).

Upper income limit for deduction calculation: 20 MZP (maximum 34,000 KZT).

Comparative Table: