In Kyrgyzstan, individual entrepreneurs (IEs) are required to comply with tax regulations, including the timely submission of financial reports. Regardless of the chosen tax regime — simplified taxation system (STS), general taxation (GTS), or special regimes such as the High Technology Park (HTP) or Creative Industries Park (CIP) — failure to file reports leads to serious consequences. This article explains in detail what happens if you fail to submit reports as an IE in Kyrgyzstan, what penalties may apply, and how to minimize risks and fix the situation.
Why Is Reporting Mandatory for IEs?
IE reporting allows the government to monitor income, taxes, and the legality of business activities. Kyrgyzstan has a relatively simple tax system, especially for IEs under STS or HTP/CIP, but even minimal requirements must be met. Reports enable the tax authority to:
- Verify the correctness of tax calculations
- Ensure turnover thresholds are not exceeded (e.g., KGS 8 million for STS)
- Confirm eligibility for benefits (e.g., 0% VAT on EAEU service exports)
Even if there is no income, not submitting reports is considered a violation and may lead to administrative and financial penalties.
What Types of Reports Must an IE File?
The type and frequency of reports depend on the tax regime:
- Unified Tax Regime
- Monthly: Income tax and social contributions report (Form No. 161)
- Quarterly: Unified tax report (Form STI-191 or STI-091) — due by the 20th of the month following the quarter
- Annually: Annual tax declaration and waste removal fee (Form STI-102)
- General Tax Regime (GTS)
- Monthly: Form No. 161 and VAT report (Form STI-062)
- Quarterly: Sales tax report (Form STI-131)
- Annually: Annual tax declaration and waste fee (Form STI-100/102)
- Patent-Based System
- IEs under patent regimes are exempt from full accounting but still file simplified reports, usually under unified tax rules.
Even with zero activity, IEs must file zero declarations. Ignoring this is a common mistake.
Consequences of Failing to File IE Reports
If reports are not filed on time or completely ignored, the State Tax Service of Kyrgyzstan (STS) may apply the following measures:
- Fines for Non-Submission
- Late filing: KGS 1,000 ($12) for individuals and KGS 5,000 ($60) for legal entities per violation (Article 235 of the Code on Offenses)
- Non-filing after 30 days: Fine increases to KGS 3,000 (~$35) for IEs; repeat violations may bring additional penalties
- Zero declarations: Same fines as regular declarations — KGS 1,000 per case
- Bank Account Freezing
- After 3+ months without reports, STS can freeze an IE’s bank account, preventing payroll, client payments, etc.
- To unblock:
- Submit overdue reports
- Pay all fines
- File a request to the tax inspectorate
- Unfreezing usually takes 3–7 working days after compliance
- Interest Charges (Penalties)
- If taxes weren’t paid due to non-filing, STS may charge interest: 0.1% per day of overdue taxes, up to 20% of total owed
- Forced Tax Assessments
- If income data is missing, the STS may calculate taxes based on:
- Industry average income (analogy method)
- Bank transaction data
- This may lead to inflated tax bills, especially under GTS where 12% VAT and 10% profit tax apply
- If income data is missing, the STS may calculate taxes based on:
- Administrative Liability
- Repeated avoidance (e.g., over one year) may lead to administrative prosecution (Article 237), with fines up to KGS 10,000 (~$120)
- Suspected tax evasion may trigger audits, resulting in additional penalties and back taxes
- Loss of HTP/CIP Status
- For IEs in HTP or CIP, non-reporting can lead to expulsion from the regime, loss of privileges (e.g., 1% turnover tax in 2025), and automatic switch to STS (4–6%) or GTS (10% profit tax + 12% VAT)
- Travel Restrictions
- Accumulated tax debts above KGS 50,000 (~$600) may lead to court-imposed travel bans until debts are paid
- Forced IE Liquidation
- Persistent non-reporting and debt can result in forced court-ordered IE closure
- Re-registration as an IE is then prohibited for 3 years, and all debts must be cleared
Specifics for IT Companies in HTP/CIP
IT businesses in HTP must submit quarterly revenue reports — even for minimal income. Missing reports can lead to expulsion, raising the tax burden from 1% (HTP) to 4–6% (STS) or 10%+12% (GTS). The same applies to CIP companies, where the 2025 turnover tax is 1%.
For IT firms working with foreign clients (e.g., Russia), failure to report may make it impossible to prove export status, resulting in 12% VAT charges instead of 0%.
How to Avoid These Issues
- File zero declarations: Even with no revenue, submit reports. It takes 10–15 minutes via e.gov.kg and prevents fines.
- Use online services: The salyk.kg portal allows remote submission. Set deadline reminders.
- Hire an accountant in Kyrgyzstan: Recommended for GTS or complex operations; fees are $50–100/month.
- Track deadlines: Set alerts for quarterly (by the 20th) and annual (by March 1st) submissions.
- Correct mistakes quickly: Filing before inspection reduces penalties.
What If You Already Missed Deadlines?
- Submit overdue reports via salyk.kg or in person
- Pay fines: Check amounts in your tax portal account and pay via bank or online
- Seek consultation: A lawyer or accountant can help with recalculations and penalties. Fees range from $20–50
- Request account unblocking after compliance
- Verify HTP/CIP status with the park administration to prevent expulsion
You can also contact our company — we assist with resolving all reporting-related issues.
Conclusion
Failing to submit reports as an IE in Kyrgyzstan may lead to fines, blocked accounts, loss of benefits, and even business closure. Even with no income, zero declarations are mandatory. Kyrgyzstan offers streamlined reporting, especially for IT and creative businesses, and online portals make it easy. Minimize risks by setting reminders, hiring support, and staying updated on legal changes. If issues arise, act quickly to fix them and protect your business.