In 2025, Kyrgyzstan remains one of the most flexible tax jurisdictions in Central Asia for foreigners. Low taxes in Kyrgyzstan, simplified administration, and the ability to register a company remotely attract both freelancers and international businesses.
However, taxation for non-residents is governed by specific provisions that differ from the general rules for Kyrgyz citizens and resident companies.
Imagine you’re a European entrepreneur earning income from clients in Bishkek, or an IT firm operating within the Creative Industries Park (CIP). How will your income be taxed? Which taxes apply, and does Kyrgyzstan have Double Taxation Avoidance Agreements (DTAAs) to reduce your burden?
1. Tax Residency in Kyrgyzstan: Key Criteria
Under the Tax Code of the Kyrgyz Republic, an individual is considered a tax resident if they spend 183 days or more in the country within any 12-month period.
If the stay is shorter, the person is treated as a non-resident and taxed only on income sourced from within Kyrgyzstan.
For companies, the same principle applies:
A legal entity is considered resident if it is registered in Kyrgyzstan or managed from its territory.
If a foreign company earns income in the country (for example, through a branch or local contract), it is deemed a non-resident legal entity.
2. Taxes for Non-Resident Individuals
2.1 Income and Tax Rate
Non-resident individuals are taxed only on income from Kyrgyz sources, at a flat rate of 10 %.
Taxable income includes:
- Salaries under Kyrgyz employment contracts
- Service fees for work performed in Kyrgyzstan
- Rental income from property located in Kyrgyzstan
- Capital gains from the sale of local assets
If you earn income remotely in foreign currency and spend fewer than 183 days in the country, no local tax applies.
2.2 Dividends, Interest, and Royalties
Payments to non-residents in the form of dividends, interest, or royalties are subject to withholding tax (WHT).
Without a DTAA, the rate can reach 15 %.
If a treaty exists between Kyrgyzstan and the recipient’s country, the rate can drop to 5 % or even zero.
For example, under the Kyrgyzstan–Poland tax treaty, dividends paid to a Polish resident may be taxed at only 5 %, provided the taxpayer presents a certificate of tax residency.
2.3 Practical Example
A Polish citizen receives dividends from a Kyrgyz company.
Without a DTAA — 15 % withholding applies.
With a treaty — 5 % withholding, and Poland credits that tax against its own liability.
3. Taxes for Non-Resident Legal Entities
3.1 Corporate Income Tax
Non-resident companies operating through branches or permanent establishments in Kyrgyzstan must pay corporate income tax at 10 % of net profit.
Certain sectors enjoy reduced rates — for instance, residents of the High Technology Park (HTP) and the Creative Industries Park (CIP) pay only 1–2 % of turnover, instead of standard profit-based taxation.
According to OECD data on corporate taxes, Kyrgyzstan’s 10 % rate remains one of the lowest in the region.
3.2 Simplified Regimes
Small businesses and service-based foreign entities can opt for the Unified (Simplified) Tax Regime, paying 2–6 % of gross turnover instead of corporate profit tax.
This is especially attractive for consulting, IT, and freelance operations.
3.3 VAT and Digital Services
The standard VAT rate is 12 %.
Since 2023, foreign companies providing digital services (software, subscriptions, streaming, etc.) to Kyrgyz clients must register as VAT payers and pay VAT on local transactions.
This requirement applies to global providers like Google, Netflix, and Adobe, as well as to regional SaaS companies.
3.4 Withholding on Non-Resident Income
When paying dividends, interest, or royalties to non-residents, Kyrgyz companies must withhold tax at source (typically 10–15 %).
The rate is reduced if a Double Tax Treaty applies.
4. Common Mistakes and Expert Tips
Mistake #1 — Assuming that low-tax regimes apply to all foreigners.
The 1–2 % preferential rates apply only to registered residents of HTP or CIP. Ordinary non-residents pay the standard 10 %.
Mistake #2 — Ignoring DTAAs.
Without a tax treaty, income may be taxed twice — in Kyrgyzstan and in your home country. Always request and submit a certificate of foreign tax residency to claim treaty benefits.
Mistake #3 — Operating without a registered branch.
If a foreign company effectively operates in Kyrgyzstan (e.g., hires staff or rents an office) but fails to register a branch or representative office, it risks penalties.
The good news: you can open a company in Kyrgyzstan remotely without visiting the country.
5. Expert Recommendations
- Check if your country has a DTAA with Kyrgyzstan — it’s the main key to reducing tax rates.
- Identify your income source — whether it arises inside or outside Kyrgyzstan.
- Keep proper documentation proving income origin and tax withholding.
- Consult local tax experts for filing assistance and compliance with the State Tax Service.
Conclusion
Taxes in Kyrgyzstan for non-residents remains transparent, predictable, and investor-friendly among CIS countries.
The key is to understand where your income is generated, how double-taxation treaties apply, and which tax rates correspond to your activity type.
With proper structuring and local compliance, Kyrgyzstan offers an excellent environment for freelancers, IT firms, and international investors seeking to minimize taxes legally and safely.
Sources
- Tax Code of the Kyrgyz Republic (official text)
- Freeman Law – International Tax Treaties Kyrgyzstan
- OECD – Corporate Tax Data 2025
- Ministry of Economy of the Kyrgyz Republic – Tax Policy Section
- PwC Tax Summaries – Kyrgyzstan Corporate Tax