Emerging Markets Rates and Currencies Handbook

When client purchases FCY in the amount exceeding 10 million US dollars within one day, the applications for the purchase of foreign currency are accepted no less than 1 business day prior to FX settlement date. Citibank Kazakhstan JSC Park Palace, 26/41 Zenkova street, Almaty, A25T0A1 Republic of Kazakhstan FX Sales Contact: +7 727 332 1522 / +7 727 332 1453 / +7 727 332 1530 Tax Summary – Kazakhstan Kazakhstan Country Tax Deductibility and Considerations Inter-Co Debt Offshore Bank Loans Offshore Local Borrowing Derivatives Equities W/H Tax • • 15% WHT • • Under certain tax treaties can be reduced to 10% (from 01/01/2023 specific rules apply for application of tax treaty reliefs to payments to related parties if the tax treaty is affected by MLI). Multilateral Convention to Implement Tax Treaty Related Measures to Prevent BEPS. Effective from 1 January 2023, if dividend, interest, and (or) royalties are paid to a related party who is a resident of a country with which the DTT has been amended by the MLI, the tax agent has the right to apply the DTT provisions if income is included in the taxable income of a non-resident recipient and is subject to tax at the nominal tax rate not less than 15%. • 15% WHT • N/A • • 15%WHT on dividends • • Under certain tax treaties can be reduced (from 01/01/2023 specific rules apply for application of tax treaty reliefs to payments to related parties if the tax treaty is affected by MLI) • • Reduced 10% WHT on dividends can be applied for non- residents if certain conditions are met: dividends not paid to “black- listed” jurisdictions, holding period above 3 years, etc. Deductibility of interests • • The Thin Capitalization rule is applicable for intracompany financing. This rule relates to the interests paid to related parties of the local legal entity, to unrelated parties under related parties warranties, or to parties registered in countries with privileged taxation (‘black-listed jurisdictions’ established by the government). The Tax Code introduced a 4/1 debt-to- equity ratio limit for non-financial companies, 7/1 debt- to-equity ratio limit for financial companies. If the ratio of the borrower company outstanding debt to its equity exceeds that limit, the Tax Code restricts the deductibility of interest paid on the excess debt. • • Transfer pricing rules apply to interest paid to related parties (i.e. arm’s length rule) • N/A • N/A Deductibility of (FX) Losses • FX losses in excess of FX gains are deductible • • Only deliverable • N/A