When you are considering hiring a global team, you not only want the right talent, but you want to make sure that the local market or country in which you going to be hiring offers favorable tax rates. What’s the point in finding great talent if the local tax rate is still going to cause payroll headaches TRUSS will break it down for you, show you the tax rates and Uzbekistan, and tell you how you can get even better Uzbek tax rates.
What is the Tax Rate in Uzbekistan?
You can break down the Uzbek tax rate into two parts, employee income tax, which is 12%, and employer taxes which is 12.1% and includes a 0.1% tax for pensions. That’s a total tax rate of 24.1%. This is the tax rate that mostly everybody pays. We say mostly because it’s not the tax rate that TRUSS pays and it’s not the rates that you would pay if you partnered with TRUSS to hire in Uzbekistan.
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How to Get a Lower Tax Rate With TRUSS
TRUSS and those who partner with us pay a significantly reduced tax rate. Why is that? Have we found a government loophole? Are you going to get in trouble? No, none of that. We are just very familiar with the Uzbek market and have undertaken the extra steps to become members of the Uzbekistan IT Park.
This is not something that most remote hiring firms have taken the time to do, and the savings are huge! Members of the IT Park get to take advantage of a 1% employee tax and a 7.5% employer tax, for a total tax rate of just 8.5%. Taking just 15 minutes out of your day to consider TRUSS could save you more than 15% in taxes, and before you ask, yes we do pass the savings on to you!
How Does Uzbekistan Compare to its Neighbors
Many of the neighboring countries are often difficult to hire remote teams whether because of legal red tape, a lack of talent, or other conditions that make them less favorable markets for remote IT workers. However, there are a few neighbors to consider:
- Kazakhstan—In Kazakhstan, most remote jobs will require an employer contribution of 16% and an employee contribution of 12% for a total of 28%.
- India—Say what you will about hiring in India, but here the employer contribution is 16.75% and the employee contribution is 17.75% for a total tax rate of 34.5%.
- Turkey—When hiring a team in Turkey, you’ll face even higher taxes with 22.5% employer contributions and 15% employee contributions for a total of 37.5%
Even without the benefits that TRUSS gets through our IT Park connection, Uzbekistan is still a highly favorable market for remote hiring. This is one of the many reasons why Uzbekistan was one of the first places that TRUSS opened an entity in.