Tax benefits for employees in Uzbekistan

A resident employee may exclude all or part of a payment from personal income tax (PIT) when the Tax Code expressly allows it—for example, medical care, education, certain gifts, financial aid and earmarked expenditure. The employer normally applies the relief against supporting documents; overwithheld tax can be recovered.

In short:

• ordinary salary is taxed at the 12% rate (Article 381, Tax Code), while a relief excludes a specific payment or reduces the tax base;
• financial aid is exempt up to 5.739.200 soums and gifts in kind up to 2.869.600 soums per tax period;
• medical care, education, childcare, a mortgage and pension contributions each have different conditions: the payment label alone is not enough;
• a non-resident pays the same 12% (Article 382, Tax Code) on salary, but these reliefs generally do not reduce the non-resident's base;
• identify the payment type first, then give the employer the application and evidence before payroll is calculated.

Updated: 04 September 2026

How employee PIT reliefs work

There is no single employee deduction from salary. The Tax Code uses three mechanisms. Some employer expenditure is not treated as income (Article 369, Tax Code). Other receipts arise as income but are exempt from tax (Article 378, Tax Code). For specified employee categories, aggregate income is reduced (Article 380, Tax Code).

PIT applies to an individual's aggregate income (Article 365, Tax Code). Classification therefore comes first: payroll identifies the payment, checks the legal ground and limit, and includes only the remaining amount in the tax base. Limits shown below through MROT, the minimum wage, or BRV, the base calculation unit, are recalculated by the site using the current amounts.

The tax period is the calendar year (Article 384, Tax Code). Annual limits restart in January, while the employer calculates PIT monthly on a year-to-date basis.

Example. With salary of UZS 10,000,000 and no relief, PIT is UZS 10,000,000 × 12% = UZS 1,200,000, leaving UZS 8,800,000 payable. If UZS 3,000,000 is lawfully directed to a qualifying purpose, the tax base is UZS 7,000,000, PIT is UZS 840,000, and the saving is UZS 360,000.

These rules are primarily for residents: a non-resident's base is determined without these reliefs (Article 366, Tax Code). Rates, tax residence and social tax are covered separately in PIT and social tax. International agreements may affect a cross-border case, but they are not examined here.

Tax-free payments and PIT reliefs

Employer payments that are not employee income

Not every payment made for an employee creates income. Employer expenditure that is not treated as employee income includes:

• milk, preventive nutrition, drinking water, personal protective equipment and hygiene products for working conditions covered by law;
• transport to and from work;
• special or uniform clothing and food required by law while duties are performed;
• relocation to another locality and specified payments to specialists in remote areas;
• documented business-trip expenses and per diems within the statutory limits;
• training students under a direct contract between the employer and an educational organisation, and employee retraining or professional development;
• compensation for injury and loss of a breadwinner within the statutory limits;
• common expenditure on working and rest conditions that cannot be attributed to an identified individual.

When the employer pays a personal expense, the employee receives a benefit in kind (Article 376, Tax Code). This includes payment for housing, utilities, childcare, education, a voucher or medical treatment. The amount is exempt only when the specific conditions of Article 378 are met; otherwise payroll withholds PIT.

Ordinary bonuses are incentive payments (Article 372, Tax Code), while holiday pay is pay for non-working time (Article 374, Tax Code). Calling part of salary “financial aid” does not change its treatment: the ground, documents and Code provision control. Meals, travel cards and compensation above the statutory limits are also taxable employment income (Article 373, Tax Code).

Financial aid and gifts

Financial aid is not exempt in every case. Aid to the family of a deceased employee, or to an employee following the death of a family member, is exempt up to 5.739.200 soums. The same limit per tax period applies to the Article 377 grounds: birth of a child, marriage, occupational injury or disease, and agricultural produce supplied as aid.

A gift from the employer is exempt up to 2.869.600 soums per tax period only when it is received in kind (Article 378, Tax Code). A cash holiday bonus is not converted into a gift for this relief. Any excess is taxable.

Aid paid because of an emergency is not treated as income (Article 369, Tax Code) to the extent of the documented loss, so the annual financial-aid limit does not apply. Severance pay and the listed forms of financial aid are other income (Article 377, Tax Code) before an exemption is applied.

Example. If an employer gives property worth 4.080.000 soums, 2.869.600 soums is exempt and 1.210.400 soums is taxable. PIT on the excess is 1.210.400 × 12%. If the employee received another gift in the same tax period, payroll uses their aggregate value.

Medical care, vouchers and insurance

An employer may pay for an employee's or the employee's children's outpatient or inpatient care without PIT. Relief applies when payment is made cashlessly to the medical provider, or money is given to the employee, family member or parent or credited to the employee's account against medical documents (Article 378, Tax Code). It covers treatment, medical services and technical equipment for disability prevention and rehabilitation.

The cost of non-tourist vouchers to institutions in Uzbekistan is also exempt: for persons with disabilities, even if they do not work for the payer, and for employees' children up to age 16, or age 18 if studying. The documents should identify the voucher type, recipient, institution and payment.

The current list has no general relief for an employer-paid voluntary life-insurance contribution. Where the employer pays for the employee's personal policy, the prudent starting classification is a benefit in kind; exemption requires another express legal ground. Insurance proceeds received by the individual after an insured event are a different income type and are not the same as the employer's payment.

Education and childcare payments

The tax result depends on who studies and how the contract is made. An employer's direct cost under a contract with an educational organisation for a student's training, and employee retraining or professional development, is not employee income (Article 369, Tax Code). The employer buys the training rather than paying money to the employee.

A different mechanism applies when an employee directs accrued salary or other income to their own education, or education of a child or spouse under age 26, at a vocational or higher education organisation in Uzbekistan, or to an education loan and interest. That earmarked income is exempt from PIT (Article 378, Tax Code).

For relief at source, the employee submits an application, a copy of the education contract and, where relevant, the education-loan agreement. The employer deducts the amount from accrued income and transfers it to the institution or bank; this document procedure (paragraph 5, Regulation No. 2107) supports non-withholding. If the employee's income is insufficient, an eligible family member (paragraph 16, Regulation No. 2107) may claim the unused portion through the tax authority.

Parents may direct income to a non-state preschool or school without PIT up to UZS 3,000,000 per month for each child. The same limit applies to day care for a child with a disability aged 3 to 18.

Example. A parent asks the employer to transfer UZS 4,000,000 per month to a preschool. With the contract and application, UZS 3,000,000 is exempt and the UZS 1,000,000 excess enters the tax base; PIT on the excess is UZS 120,000.

Mortgages, pension contributions and investment accounts

An employee may direct taxable income to several long-term purposes, each subject to its own conditions.

The mortgage, pension and investment conditions are in the earmarked-expense list (Article 378, Tax Code). The mortgage limit is shared between borrower and co-borrowers. A budget subsidy for the down payment or interest is required, except for the young-spouse case specified by the Code.

For a voluntary funded-pension contribution, the employee files a written request. The amount cannot exceed accrued income, and the employer transfers it by salary payment day (paragraph 6, Regulation No. 2111). Mandatory funded contributions, their investment income and pension payments are exempt from tax (Article 14, Law No. 702-II).

Example. An employee directs 27.200.000 soums per month to an investment account. After five months the total is 136.000.000 soums, the full annual limit; a sixth contribution no longer fits within the relief. The mortgage test is similar: aggregate payments by the borrower and co-borrowers are compared with 108.800.000 soums.

Example. If evidenced retraining costs 4.400.000 soums, 3.520.000 soums qualifies and 880.000 remains in the tax base. PIT on the excess is 880.000 × 12%.

Reliefs for specified employee categories

For some employees, part of monthly aggregate income is excluded rather than a particular payment. The list of qualifying categories (Article 380, Tax Code) is exhaustive.

If the employee has several grounds, one is chosen. Entitlement starts in the month in which the ground arises. The employee must notify the employer within 15 days after losing it.

Example. An employee with a Group II disability earns UZS 8,000,000. The tax base is UZS 8,000,000 minus 4.080.000 soums, but not below zero; PIT is 12% of the balance. The method is the same for a category with the 1.917.600 limit, with only the reduction changing.

How to claim and recover relief

Claiming relief through an employer

Start with payroll at the principal workplace. A category relief requires an application and the document prescribed for that category; a person without a principal workplace claims it by tax return. The employer keeps benefit evidence for at least three years (Article 84, Tax Code) after the period in which the conditions ceased to apply.

For an earmarked payment, attach the contract, invoice or recipient certificate and state the amount to transfer from accrued income. The money is paid directly to the institution, bank, clinic or other recipient when the relief prescribes that route. Reimbursement of a personal cost already paid qualifies only where the provision expressly allows a payment to the employee and specifies the evidence.

The employer calculates PIT on the employee's taxable income (Article 387, Tax Code) and records income, reliefs and tax withheld. On changing principal employment, give the new employer the income and tax certificate before the first salary; otherwise specified reliefs are withheld temporarily and a tax recalculation (Article 388, Tax Code) follows after the certificate is provided. At the employee's request, the employer issues an income certificate (Article 386, Tax Code).

Check the payslip: accrued income, earmarked transfer, tax-free limit, tax base and PIT should reconcile. Salary calculation and withholding rules are explained separately in Salary calculation and payment.

Recovering overwithheld tax

If payroll has withheld too much PIT during the current calendar year, give the employer a written application and bank details. The tax agent returns the amount cashlessly within three months (Article 391, Tax Code) against future PIT transfers.

After the tax period ends, or if the tax agent no longer exists, apply to the tax authority together with a return. Attach tax-agent certificates and the relief evidence; after the authority notifies an error, a corrected return is due within ten days (Article 396, Tax Code). The general claim period is three years (Article 104, Tax Code), and withheld tax may be refunded whether or not the individual is registered for tax (Article 105, Tax Code).

The aggregate annual income return is due by 1 April (Article 397, Tax Code) of the following year. If recalculation leaves tax payable, it is due by 1 June (Article 398, Tax Code). For a refund, prepare the computation, application, employer certificate, bank details and evidence of the ground and payment.

Changes in 2026

• ZRU-1129, 17 April 2026 (Article 3) extended the relief to payment for day care for children with disabilities aged 3 to 18. The limit is UZS 3,000,000 per child per month.
• The Law took effect on official publication (Article 7). A recalculation for earlier months must therefore use the wording in force on the payment date.

Frequently asked questions

Which tax benefits can an employee claim?

The main groups are non-income employer expenditure, exemptions for earmarked payments and an income reduction for specified categories. Common examples include medical care, education, childcare, mortgages, pension contributions, financial aid and gifts. The payment's label does not create relief: check the recipient, purpose, limit, payment route and supporting evidence.

Can education relief be claimed after payment?

Yes, if the expense and payer meet the conditions. Apply before PIT is withheld so the employer can transfer accrued income to the institution or bank. If tax has already been withheld, attach the evidence to the return and refund application. An eligible family member may claim an unused portion.

Is financial aid paid to an employee taxable?

It depends on the ground. Aid following death, childbirth, marriage, occupational injury and specified other events is exempt up to 5.739.200 soums. Emergency aid within the actual documented loss is not treated as income. A holiday or vacation payment without a statutory ground is generally taxed as employment income.

Can two reliefs be used at the same time?

Reliefs for different payments can operate together: an employee may direct income to education and receive exempt medical treatment if every condition is met. But a person who falls within several specified categories chooses only one monthly income reduction. The same expense cannot be excluded from the base twice.

What if the employer did not apply the relief?

First give payroll the application, supporting evidence and a request for recalculation. The employer returns an overpayment for the current tax period. After year-end, or where there is no tax agent, apply to the tax authority with the return, income certificate, computation and bank details. Keep evidence of delivery and the response.