From this moment, the Law of the Republic of Kazakhstan "On compulsory social insurance" will lose its force.

On July 1, 2023, the Social Code comes into force in Kazakhstan. From this moment, the Law "On Pension provision in the Republic of Kazakhstan", as well as the Law of the Republic of Kazakhstan "On Compulsory social insurance" lose its force. Correspondent of the business information centre Kapital.kz has prepared an overview of what changes are expected in the compulsory social insurance system.

Social contributions are mandatory payments that are paid by an employer or self–employed person to the State Social Insurance Fund. They give the right to the participant of this system, for whom deductions were made, to receive social benefits.

The right of social benefit on maternity and adoption of a newborn child (children) is described in Article 77 of the Social Code. The right for childcare social benefit – in Article 84. In case of unemployment social benefit – in Article 113. And in case of survivors social benefit, this right is granted to his family members who were dependent on him (paragraph 2 of Article 239).

Who is a member of the system

According to Article 243 of the Social Code of the RK , compulsory social insurance is subject to:

- employees, as well as persons who have other paid work (elected, appointed or approved), including those engaged in labor activity in the representative offices of international organizations in Kazakhstan, diplomatic missions and consular offices of foreign states accredited in the RK;

- individual entrepreneurs, including heads of peasant or farms, as well as their members who have reached the age of 18;

- persons who are engaged in private practice;

- individual assistants in accordance with the Social Code of the RK (new paragraph – Ed.).

Individuals who pay a single aggregate payment in accordance with Article 774 of the Tax Code of the RK are subject to mandatory social insurance until January 1, 2024.

Starting from January 1, 2025, this list will also include individuals who receive income under civil contracts concluded with tax agents under the legislation of the RK, including those working in representative offices of international organizations in the RK, diplomatic missions and consular offices of foreign states accredited in Kazakhstan. The subject of these contracts is implementation of work/provision of services.

According to Article 243, compulsory social insurance applies to Kandases, as well as foreigners and stateless persons permanently residing on the territory of the RK, who carry out income-generating activities on the territory of Kazakhstan, on an equal basis with citizens of the RK.

Persons who have reached retirement age under Article 207 of the Social Code, as before, are not subject to compulsory social insurance. It should be noted that citizens who lived in the zones of extreme and maximum radiation risk in the period from August 29, 1949 to July 5, 1963 for at least 5 years have the right to receive pension payments by age: men – upon reaching 50 years, women – upon reaching 45 years. Also, women who have given birth (adopted) 5 or more children and raised them up to the age of eight are entitled to age pension payments upon reaching 53 years.

According to paragraph 1 of Article 244, the rate is 3.5% of the object of calculation of social contributions, and from January 1, 2025 it will be 5%.

For individuals who pay a single aggregate payment in accordance with Article 774 of the Tax Code of the RK, the amount of social contributions paid by them is 20% of the object of calculation of social contributions. This paragraph (paragraph 2 of Article 244) is valid until January 1, 2024.

According to paragraph 3 of Article 244, for tax agents who have chosen to pay social contributions as part of a single payment, the rate of social contributions is set at 3.2%, and from January 1, 2025 – 4.5% of the object of calculation of social contributions.

The rate of social contributions in the single aggregate payment rate established by the Tax Code of the Republic of Kazakhstan is from January 1: 2023 – 16%, 2024 – 14.9%, 2025 – 18.9%, 2026 – 18.1%, 2027 – 17.4% and 2028 – 17.1%.

The object of calculating social contributions is described in Article 245 of the Social Code of the RK.

Source: Internet resource: https://kapital.kz/gosudarstvo/116988/chto-izmenit-sya-v-sisteme-obyazatel-nogo-sotsstrakhovaniya-s-1-iyulya.html