Before 2026, a company paying a self-employed person did not withhold tax on their behalf: the self-employed person was responsible for their own tax, and income up to 100 million UZS a year was not taxed at all. Law No. ZRU-1108 of 25.12.2025 changed this. Now, for payouts to the self-employed, the legal entity performs the duties of a tax agent.
1. What changed on 1 January 2026
| Before 2026 | From 2026 | |
|---|---|---|
| Rate for the self-employed | 0% up to 100 million UZS, 4% above | 1% of income up to 1 billion UZS |
| Who pays tax on payouts from a legal entity | the self-employed person | the legal entity withholds at source |
| Who reports | the self-employed person | the legal entity, per self-employed person |
| Exceeding the limit | turnover tax | VAT and profit tax from the day of exceeding |
Legal basis: Presidential Resolution No. PP-247 of 12.08.2025 and Article 461 of the Tax Code as amended by Law No. ZRU-1108.
2. When a company becomes a tax agent
The law distinguishes two income channels of a self-employed person:
- payouts from a legal entity: that legal entity is recognised as the tax agent. The tax is withheld at source based on a notification from the tax authorities;
- income via digital platforms of payment organisations: the payment organisation acts as the tax agent. Taxi and delivery services that withhold 1% from each order work this way.
The law explicitly names the legal entity as tax agent for the income of the self-employed. For payouts to sole proprietors the procedure may differ, so agree this case separately with your accountant.
3. How to calculate and withhold the tax
The tax is calculated on the fee stated in the act. Example:
| Item | Amount, UZS |
|---|---|
| Fee under the act | 5,000,000 |
| 1% turnover tax, withheld by the company | 50,000 |
| Paid to the contractor's card | 4,950,000 |
The company pays the withheld amount to the budget within the deadlines set by the Tax Code for tax agents. The tax is credited to the self-employed person's personal account at the tax office where they are registered, so the contractor owes nothing extra on this income.
Important: the contract amount and the amount paid out differ. State in the contract that the fee includes the tax withheld by the client, so the contractor does not expect to receive the full amount.
4. Reporting
The tax agent reports on the income of the self-employed broken down by each person. For this, keep a record for every contractor: PINFL, activity type, payout dates and amounts, tax withheld. The same data helps you spot in time that a contractor is approaching the 1 billion UZS limit.
5. What to do when the limit is exceeded
If a self-employed person's total annual income exceeds 1 billion UZS, from the day of exceeding they must switch to VAT and profit tax, and the 1% regime no longer applies. For the company this means further payouts cannot be processed as ordinary self-employed payouts with 1% withheld. Ask the contractor to confirm their new tax status and to issue e-invoices including VAT.
6. Common mistakes
- Paying without checking status: the contractor has no QR-code certificate or the status has ended.
- The activity is not on the list of 72 types or is permitted only for services to individuals.
- No e-invoice and no act: the expense is hard to support when calculating profit tax.
- Tax not withheld: as tax agent, the company is liable for failing to withhold.
- An employment relationship disguised as self-employed payouts: risk of additional personal income tax and social tax.
This material is for reference and reflects the legislation of the Republic of Uzbekistan as of October 2026. Before acting on a specific situation, check the current wording of the acts on lex.uz or consult a tax adviser.