With convenient access to both European and Asian countries, Kazakhstan is a great place for companies looking to expand and build many international relationships. However, before you start hiring employees and working with other international businesses, you need to set up your Kazakhstan payroll, follow the country’s tax guidelines, and more.
Taxation rules in Kazakhstan
As of Jan. 1, 2024, some tax indicators in Kazakhstan changed. The monthly calculation index increased to KZT 3,692 (previously KZT 3,450), and the minimum wage also increased to KZT 85,000.
- Employee taxes: The maximum tax to the pension fund of 10% is now KZT 425,000 (previously KZT 350,000). The maximum tax on medical insurance (2%) is now KZT 17,000.
- Employer taxes: The maximum employer tax (social contribution 3.5%) is now KZT 20,825 (previously 17,150). The maximum employer tax (medical insurance 3%) is now KZT 25,500.
- Pension: The mandatory pension contribution for employers is 1.5% of the employee’s salary.
Kazakhstan payroll options for companies
Companies have 3 different Kazakhstan payroll options:
- Internal: An internal payroll is a great option for large companies planning to work in Kazakhstan for years to come. Make sure you have a large HR team with individuals who are also experts in Kazakhstan employment compliance to run an internal payroll successfully.
- Payroll processing company: You can also work with a Kazakhstan payroll processing company that will outsource your payroll. The only problem is that your company will still be responsible for compliance.
- G-P: The easiest way to run payroll in Kazakhstan and stay compliant is partnering with a global Employer of Record (EOR) like G-P. With us, you can rest assured that all employees will be paid on time, freeing you to focus on other important aspects of your business.
How to set up a payroll in Kazakhstan
Before you can choose a Kazakhstan payroll option, you have to incorporate in the country. The entire process can take anywhere from a few weeks to a few months, and this period can delay your expansion timeline. You won’t be able to hire employees, form business relationships, or start working until you establish a subsidiary.
Fortunately, you can avoid this requirement by working with G-P. When you partner with us, you can start working in a few days, and we’ll manage all of Kazakhstan’s employment compliance laws, so you don’t have to.
Entitlement/termination terms
Outlining entitlement and termination terms before adding employees to your payroll can ensure that you stay compliant. Termination can be challenging in any country, so including entitlement and termination terms in an employment contract can help.
Kazakhstan allows probation periods of up to 3 months. You can terminate an employment contract for any of the reasons outlined in the Kazakhstan labor laws, but you must notify the employee in writing and give at least 1 month of notice. Some employees are entitled to severance pay depending on the reasons for termination.
Streamline global payroll management with G-P.
G-P streamlines each step of the payroll management process with our market-leading Global Growth Platform™. Pay your team with confidence anywhere in the world in 150 currencies with our 99% on-time automated payroll system — all with just a few clicks. Our products also integrate with leading HCM solutions, syncing employee payroll data across platforms automatically to create one reliable, convenient source of truth for HR teams.
Contact us to learn more about how we can support you.