July 12, 2023
Acquisition of real estate by foreigners in Kazakhstan
- General provisions
- Acquisition of a land plot
- Acquisition of non-residential real estate
- Acquisition of housing by inheritance
- Consequences of loss of citizenship
- The procedure for registration of a transaction for the purchase and sale of real estate
- Taxes on the sale of real estate
According to article 9 of the Law of the Republic of Kazakhstan dated June 19, 1995 “On the legal status of foreigners”, foreigners permanently residing in the Republic of Kazakhstan may own housing and other property in the Republic of Kazakhstan. Foreigners who have received a permanent residence permit, in other words, a residence permit, are recognized as permanent residents in the Republic of Kazakhstan.
A prerequisite for granting a permanent residence permit in the Republic of Kazakhstan is the confirmation by the person applying for such a permit of their solvency in the manner and amounts determined by the Ministry of Internal Affairs of the Republic of Kazakhstan.
As for legal entities with foreign participation, foreign legal entities without the establishment of a subsidiary, the opening of a branch (representative office), there are no restrictions to acquire ownership of housing, even if the founder does not live in the territory of the Republic of Kazakhstan.
Acquisition of a land plot
According to paragraphs 3, 4 of Article 23 of the Land Code of the Republic of Kazakhstan, land plots may be privately owned by foreign citizens, stateless persons and foreign legal entities (non-governmental) only for the purposes of:
• construction or built-up industrial and non-industrial, including residential, buildings (structures, structures) and their complexes;
• for the maintenance of buildings (structures, structures) in accordance with their purpose.
Lands intended for commercial agricultural production and afforestation may not be owned by foreigners and foreign legal entities (paragraph 4 of Article 23 of the Land Code).
Foreigners, stateless persons, foreign legal entities, legal entities of the Republic of Kazakhstan with foreign participation, international organizations, scientific centers with international participation, as well as kandases cannot own agricultural land plots on the right of private ownership or land use.
Upon termination of citizenship of the Republic of Kazakhstan from a person who is a participant (shareholder, member) of a legal entity of the Republic of Kazakhstan, the right of private ownership, as well as the right of temporary land use for agricultural land plots are subject to alienation in accordance with the norms of Article 66 of the Land Code.
It is also not allowed to grant agricultural land plots to private ownership and on the right of land use to citizens of the Republic of Kazakhstan who are married with foreigners or stateless persons.
It is not allowed to grant land plots located in the border zone and border strip of the Republic of Kazakhstan to private ownership of foreigners, stateless persons and foreign legal entities.
Acquisition of non-residential real estate
With regard to the acquisition of real estate that is not related to the housing stock (buildings, structures, premises, offices, shops, etc.), the legislation of the Republic of Kazakhstan does not contain restrictions, regardless of whether a foreigner is a permanent resident or a temporary resident.
Acquisition of housing by inheritance
Foreign citizens have the right to inherit real estate and any other property regardless of whether they live in Kazakhstan or not.
At the same time, paragraph 1 of Article 252 of the Civil Code of the Republic of Kazakhstan establishes that if, on the grounds permitted by legislative acts, a person owns property that cannot belong to him by virtue of legislative acts, this property must be alienated by the owner within one year from the moment of the emergence of ownership of this property, if other terms are not provided by legislative acts.
Thus, a foreigner who has legally inherited housing must sell it within one year, since a foreigner who does not have a residence permit does not have the right to own housing on the territory of the Republic of Kazakhstan or obtain a residence permit.
Consequences of loss of citizenship
If a citizen of the Republic of Kazakhstan purchased an apartment (or other real estate), and subsequently lost his citizenship and (or) left Kazakhstan, then the current legislation does not provide any grounds for the loss of ownership, including by selling it. Thus, the legislation does not provide for the obligation of a former citizen of the Republic of Kazakhstan to alienate his real estate after the loss of citizenship, as well as the right of the state to withdraw such real estate.
Exceptions to the above rule are established in relation to land plots. According to paragraph 2 of Article 23 of the Land Code, when a citizen who is the owner of a land plot provided for farming or farming, personal subsidiary farming, afforestation, gardening and dacha construction leaves the citizenship of the Republic of Kazakhstan, the ownership right is subject to alienation or re-registration in accordance with the norms of Article 66 of the Land Code.
The procedure for registration of a transaction for the purchase and sale of real estate
it is necessary to obtain a registration certificate of registration of a non-resident as a taxpayer with the assignment of an Individual Identification Number (IIN) for an individual, and a foreign legal entity must obtain a registration certificate of registration of a non-resident as a taxpayer with the assignment of a Business Identification Number (BIN);
In case of submitting a contract through the Public Service Center, a foreign legal entity additionally provides a legalized extract from the commercial register or other legalized document certifying that the foreign legal entity is a legal entity under the legislation of a foreign state, with a notarized translation into Kazakh and Russian and a legalized decision of the authorized body of a foreign legal entity on the acquisition of immovable property with certified translation into Kazakh and Russian.
conclusion of a real estate purchase and sale agreement. With regard to the form of the transaction, in accordance with Article 21 of the Law of the Republic of Kazakhstan dated July 26, 2007 “On State Registration of rights to immovable property”, if the transaction is not notarized, the registering authority is obliged to verify the authenticity of the signatures of the persons who made the transaction (their authorized representatives), their legal capacity (legal capacity), as well as their compliance will to will. Thus, the contract of sale of real estate must be concluded in a notarized form or in the presence of employees of the registering authority.
state registration of the real estate purchase and sale agreement. The right of ownership of immovable property arises after its state registration. In the case of concluding a contract for the sale of real estate in a notarized form, the notary independently sends the contract for state registration in electronic form. The notification of the registration sent by the registering authority in electronic form confirms the fact of registration of the contract.
Taxes on the sale of real estate
According to paragraph 14) of paragraph 2 of Article 319 of the Tax Code of the Republic of Kazakhstan, the increase in value during the sale (transfer as a contribution to the authorized capital of a legal entity) of dwellings, country houses, garages, personal subsidiary facilities located on the territory of the Republic of Kazakhstan is not considered as income of an individual (and therefore is not subject to taxation). the right of ownership is one year or more from the date of registration of the right of ownership.
Thus, if the apartment was owned for more than 1 year before the sale, then the seller does not have an obligation to pay tax.
If the object was owned for less than 1 year before the sale, it is necessary to pay tax (IPN) at the rate of:
10% if the seller is a citizen and resident of the Republic of Kazakhstan (Clause 1 of Article 320 of the Tax Code of the Republic of Kazakhstan);
15% if the seller is a non–resident of the Republic of Kazakhstan (Clause 5, clause 1, Article 646 of the Tax Code of the Republic of Kazakhstan).
The date of registration of ownership rights means the date of their state registration.
Not the entire amount received from the sale of an apartment is subject to taxation, but only the so-called “income from value gains” (Clause 1 of Clause 1 of Article 331 of the Tax Code of the Republic of Kazakhstan) – the amount of the difference between the sale price and the amount for which the apartment was previously purchased. If there is no difference (the apartment is sold for the same amount for which it was previously purchased) or it is negative (the apartment was sold cheaper than the purchase price), then the object of taxation does not arise and the tax is also not required to pay.
If the apartment being sold was previously inherited, then its market value should be determined on the date of registration of ownership by ordering an assessment report from an appraiser. If the deadline is missed, the estimated value will be taken as the value accepted as the basis for calculating the amount of property tax on January 1 of the year in which the ownership right arose.
Foreigners – citizens of states with which the Republic of Kazakhstan has concluded Conventions on the avoidance of double taxation, can also use the provisions of these conventions, if the legislation of their states does not provide for the taxation of value gains on the sale of real estate. In order to apply the provisions of an international agreement, a foreigner must obtain a written confirmation (certificate, certificate) from the tax authority of his state that he is a resident of his state. This document must be presented to the tax authority of the Republic of Kazakhstan.