The India–Kazakhstan double tax treaty has long offered Indian-owned holding structures a competitive pathway into the EAEU market, with reduced withholding tax rates on dividends, interest, and royalties payable to Indian-resident recipients. From early 2027, however, the procedure for accessing those reduced rates in Kazakhstan has materially changed. Amendments to Kazakhstan's tax administration rules — effective as of the start of the 2027 tax year — introduce a revised beneficial ownership confirmation regime and tighten the documentary conditions that a Kazakhstani tax agent must satisfy before applying a treaty-reduced rate at source. For Indian groups that route payments through intermediary holding entities or that have not yet updated their beneficial ownership declarations, the practical effect is that the default 15 per cent withholding rate now applies unless the new procedure is fully observed.
Until the close of the 2026 tax year, a Kazakhstani paying entity — whether a subsidiary, a joint venture vehicle, or a local operating company — could apply a reduced treaty rate on dividends or interest payments by relying on a standard certificate of tax residency issued by the Indian tax authorities, combined with a self-declaration of beneficial ownership. The documentary threshold was relatively light, and in practice many tax agents applied treaty rates on the basis of a residency certificate alone, without separately verifying that the Indian recipient satisfied the beneficial ownership test.
The 2027 amendments restructure this approach in two significant respects. First, the beneficial ownership declaration is now a standalone document with prescribed content requirements — it must identify the economic rationale for the payment, confirm that the recipient has the right to dispose of the income without a contractual or legal obligation to transmit it to a third party, and describe the recipient's principal business activities in India. A bare-form self-declaration is no longer sufficient.
Second, the amendments introduce a look-through obligation on Kazakhstani tax agents for payments above a prescribed threshold. Where the immediate recipient is not the entity that the Kazakhstani payer believes to be the beneficial owner — for example, where payment flows through a Mauritius, Cyprus, or UAE holding layer before reaching the Indian parent — the tax agent is now required to apply the rate applicable to the intermediate jurisdiction unless the Indian beneficial owner provides a chain-of-title disclosure satisfying the new content requirements.
For Indian groups that have historically relied on multi-tier holding structures — a common arrangement for EAEU market entry, particularly where the Cypriot or UAE layer was inserted before the Indian parent was identified as the intended ultimate recipient — this look-through obligation is the most consequential element of the 2027 changes.
"The 2027 amendments represent a structural shift from form-based to substance-based beneficial ownership verification — a direction that mirrors OECD guidance and that will require Indian groups to revisit documentation that was perfectly adequate twelve months ago." — Aigerim Serikbayeva, Contributing Regional Analyst — Kazakhstan, EAEU Trade, Customs & Market Entry
The practical impact of the amendments falls unevenly across different types of Indian presence in Kazakhstan, and the answer depends primarily on the corporate structure through which income flows back to India.
Indian groups with a direct subsidiary in Kazakhstan — where the Indian parent holds the Kazakhstani entity's shares directly and receives dividends — face the lightest adjustment burden. The new beneficial ownership declaration requirement is largely satisfied by existing corporate documentation, provided the declaration is prepared in the prescribed form and submitted to the Kazakhstani subsidiary before the payment date. Groups in this category should treat the update as an administrative compliance exercise rather than a structural problem.
The more significant exposure falls on Indian groups that use an intermediary holding layer — whether in Mauritius, Cyprus, the UAE, or the Netherlands — to hold their Kazakhstani assets. Under the prior regime, it was defensible (if commercially imperfect) for the Kazakhstani subsidiary to apply the India–Kazakhstan treaty rate on the basis that the Indian parent was the ultimate beneficial owner, even if the immediate dividend recipient was the intermediate entity. The 2027 look-through obligation removes that flexibility for payments above the threshold level. The Kazakhstani tax agent must now either apply the rate of the intermediate jurisdiction's treaty (or the default 15 per cent rate, if no treaty applies) or obtain the full chain-of-title disclosure that the amendments prescribe.
Interest payments on intragroup loans are similarly affected. Indian treasury entities that lend to Kazakhstani operating subsidiaries — a common cash-pooling arrangement for large Indian conglomerates with EAEU operations — will need to reassess whether the Kazakhstani borrower's obligation to withhold at treaty rates is correctly documented under the new regime.
Royalty flows present a particular complexity. Where intellectual property is owned by an Indian entity and licensed to a Kazakhstani subsidiary, the interaction between the beneficial ownership test and the principal purpose test — which Kazakhstani tax authorities have applied with increasing frequency since 2025 — creates a layered disclosure obligation that the amendments do not resolve with complete clarity.
For in-house counsel managing a regional tax function that spans Kazakhstan alongside other EAEU jurisdictions, it is worth noting that the Kazakhstan changes are not uniform with the approaches taken by Uzbekistan, Armenia, or Kyrgyzstan, all of which apply their own treaty-relief procedures under bilateral arrangements that differ materially from Kazakhstan's. The [Tax](/jurisdictions/kazakhstan/tax/) section of the Kazakhstan jurisdiction guide provides a comparative overview of applicable treaty frameworks across these markets.
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The amendments took effect from the start of the 2027 tax year. For groups that have made payments since 1 January 2027 under the prior documentation standard, there is a question of whether the reduced treaty rate was correctly applied — and whether a supplementary disclosure to the Kazakhstani tax agent is needed to regularise the position before the end of the annual reporting period.
The practical steps divide into three categories, which broadly correspond to the urgency of the position.
First, any Indian group that has a dividend, interest, or royalty payment scheduled within the next quarter should prioritise obtaining a beneficial ownership declaration in the new prescribed form before that payment is made. Where an intermediary holding layer exists, the chain-of-title disclosure package should be assembled in advance of the payment date, not after — Kazakhstani tax agents do not have discretion to apply a treaty rate retroactively once a payment has been made at the default rate and reported.
Second, groups with payments already made in 2027 under the prior documentation standard should seek a legal opinion on whether those payments were correctly administered under the transitional position. The amendments include a transitional provision, but its scope is not unlimited — it does not extend to payments made without any beneficial ownership documentation at all.
Third, Indian groups that use multi-tier structures should commission a structural review of whether the intermediate holding layer continues to serve its intended commercial purpose under the new look-through regime, or whether consolidating the holding structure to enable a clean direct-ownership position would be more efficient for treaty access purposes going forward. This is not a decision that needs to be made immediately, but it is one that should be framed clearly before the 2027 annual tax filing window.
Groups with Kazakhstan operations that also have Russian-law elements — for example, where the Russian entity sits alongside the Kazakhstani entity under the same Indian parent, or where cross-border supply agreements run between Kazakhstani and Russian subsidiaries — should note that the Russian and Kazakhstani treaty regimes operate independently. The [Cross-border Disputes](/jurisdictions/kazakhstan/disputes/) and [Tax Residency & Relocation](/jurisdictions/kazakhstan/tax-residency/) pages address the interaction between these frameworks in more detail.
We are a Russian-qualified firm. For Kazakhstan-specific legal advice — including beneficial ownership documentation, local tax agent instructions, and tax authority correspondence — we work with trusted Kazakhstani counsel and can coordinate the engagement from the Russian side for groups that have both Russian and Kazakhstani elements in their structure.
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Q: What specifically changed in Kazakhstan's DTT relief procedure from 2027?
A: Kazakhstan's 2027 tax administration amendments replace the prior light-touch beneficial ownership confirmation process with two new requirements: a standalone beneficial ownership declaration with prescribed content (economic rationale, disposal rights, business description) and a look-through obligation for Kazakhstani tax agents on payments above a prescribed threshold where an intermediate holding entity sits between the paying entity and the Indian beneficial owner. Certificate-of-residency-only reliance is no longer sufficient to access treaty-reduced rates.
Q: Which Indian groups are most directly affected by the 2027 amendments?
A: Groups with multi-tier holding structures — where dividends, interest, or royalties flow from a Kazakhstani entity to an intermediate layer (Mauritius, Cyprus, UAE, or Netherlands) before reaching the Indian parent — face the most immediate compliance burden. The look-through obligation means the Kazakhstani tax agent must now apply the intermediate jurisdiction's treaty rate (or the default rate) unless a full chain-of-title disclosure is provided. Groups with direct Indian ownership of Kazakhstani entities face a lighter adjustment: primarily, the preparation and submission of the new-form beneficial ownership declaration before each payment.
Q: What should an Indian group do if it has already made payments in 2027 under the prior documentation standard?
A: The first step is to assess whether the applicable transitional provision covers those payments. The transitional provision has limits — most importantly, it does not protect payments made without any beneficial ownership documentation. For payments that fall outside the transitional protection, a supplementary disclosure to the Kazakhstani tax agent may regularise the position before the annual reporting deadline. Independent legal advice on the specific payment dates and amounts is advisable before any filing is made.
Vetrov & Partners is a Russian boutique law firm established in 2009, recognised by Pravo-300 for eight consecutive years. The firm advises foreign companies — including Indian-owned groups with EAEU operations — on cross-border structuring, tax, and regulatory matters involving Russia and the wider CIS region. For Kazakhstan-specific instructions, we coordinate with trusted local counsel and manage the engagement from the Russian side.
Enquiries: info@vetrovpartners.com | WhatsApp / Telegram: +7 (983) 510-38-76 | t.me/vitvetcom
This publication is provided for informational purposes only and does not constitute legal advice under Russian or any other applicable law. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. Vetrov & Partners is a Russian-qualified law firm. For matters governed by foreign law or requiring local admission in another jurisdiction, we collaborate with trusted counsel in the relevant jurisdiction. For advice regarding your particular situation, please contact info@vetrovpartners.com.
— Aigerim Serikbayeva Contributing Regional Analyst — Kazakhstan · EAEU Trade, Customs & Market Entry vetrovpartners.com/contributions/