How to Run Payroll in Uzbekistan: Employment Taxes & Setup

Milani Notshe

Research Specialist

Last Updated

February 13, 2026

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Running payroll in Uzbekistan involves many moving parts before your team sees money land in their accounts. Each month you need to calculate gross-to-net correctly, apply statutory withholdings and employer contributions, issue compliant payslips, plus file and remit on schedule. If anything slips through the cracks, you could face penalties, back-pay exposure, and unnecessary friction with your people.

If you’re hiring in Uzbekistan, whether you’re building a local presence or expanding your global footprint, this guide is for you. We’ll walk through the choices and compliance requirements that have the biggest impact on your speed and risk, from entity vs. no-entity hiring to worker classification and the statutory bodies you’ll interact with along the way. By the end, you’ll know exactly what to expect and how to keep payroll running smoothly, wherever you’re hiring.

Key Takeaways

Payroll cycle: Employers in Uzbekistan typically process payroll on a monthly basis.

Tax filing: Monthly reporting and remittance of personal income tax and social contributions are generally required through the government’s e-filing system.

Employer taxes: Employers contribute to mandatory social funds, including social insurance and other statutory charges as defined by national regulations.

Tax year: Uzbekistan follows the calendar year for income tax and payroll reporting.

Payroll processing methods: Payroll is usually handled through electronic payroll software aligned with Uzbekistan’s reporting systems or outsourced to local payroll service providers.

How to Choose Your Payroll Structure in Uzbekistan

Expanding into Uzbekistan? Building a compliant payroll setup involves much more than simply paying salaries. You’ll be responsible for employment compliance, monthly tax and social declarations, and mandatory benefits. Even small delays in filings or payments can lead to real penalties.

You have several operating models to choose from to make this easier. The right one depends on your legal footprint, your appetite for risk, and how quickly you need to start hiring. Let’s break down the main options and when to use each.

1. No Local Entity in Uzbekistan: Use an Employer of Record (EOR)

If you don’t yet have a legal entity in Uzbekistan, an Employer of Record is usually the fastest and lowest-risk way to hire. An EOR becomes the legal employer on paper, provides locally compliant employment contracts, and manages payroll under local regulations, while you continue to direct the work and manage performance.

This model is ideal for:

Testing a new market
Hiring your first team members
Scaling a distributed workforce without building local infrastructure,

Why it’s the fastest and least risky option:

You skip the lengthy process (and cost) of setting up an entity.
All local registrations, monthly declarations, and statutory payments are handled by a provider already set up in-country, dramatically reducing your compliance risk.

2. You Have a Uzbekistan Entity: Run In-Country Payroll

If you already operate a local entity, or you’re planning to establish one, running payroll directly gives you maximum flexibility and control. You can set your own policies, design benefits, and align payroll closely with your finance and internal approval processes. But this also comes with greater operational responsibility.

What you’re responsible for:

Registering with relevant authorities and maintaining compliance with statutory bodies (often involving CSS/IPRES or similar local institutions).
Accurately calculating and remitting payroll taxes and contributions every month – plus handling year-end requirements.
Issuing compliant payslips and maintaining audit-ready payroll documentation.

When this option makes sense:

You’re hiring at scale and want payroll fully “in-house,” even if you partner with a local provider for execution.
You need deeper integration with finance systems or custom benefit structures.

If you want to keep the entity but offload the admin, many employers choose global payroll services to handle calculations, filings, and payments while they remain the legal employer.

3. Contractors Only: Use Contractor Management

Paying independent contractors is often simpler than setting up full payroll, especially for short-term or highly specialized work.

However, you need to watch out for misclassification risk. In Uzbekistan, as in many jurisdictions, someone may legally qualify as an employee based on how they work – not what their contract says. If they’re under your direction, working like an employee, you may be responsible for full employer obligations.

When contractor payments work well:

You need specialised expertise for a defined scope or timeframe
The contractor operates independently, not under your control or supervision

You can also use contractor management services to streamline compliant contracts, invoicing, and payments.

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What To Know About Payroll Processing In Uzbekistan

Payroll in Uzbekistan centers on four main obligations: personal income tax withholding, mandatory social contributions, employer-funded insurance and development levies, and periodic payroll reporting to the State Tax Committee and extra-budgetary funds. You must calculate and withhold employee income tax, apply employer contribution rates correctly, and submit monthly reports and payments in Uzbek soum through approved channels. Rules can differ by sector, special tax regime, and company size, so your team needs clear internal controls and up-to-date local guidance.

Non-compliance can trigger back taxes, late-payment interest, administrative fines, and in serious cases tax audits that disrupt operations and damage employee trust if salaries or benefits are delayed. This guide walks you through how to structure payroll calculations, align with statutory deadlines, file electronically, and choose between running payroll via your own entity or using an Employer of Record. By the end, you will understand the key rates, forms, and processes needed to keep payroll compliant in Uzbekistan in 2026.

Types Of Payroll Taxes In Uzbekistan

Uzbekistan’s payroll framework is relatively streamlined, with a flat personal income tax rate, unified social contributions, and a small set of employer-side levies that must be calculated and remitted monthly. Your main focus will be applying the correct percentage to gross earnings, respecting any exemptions, and ensuring payments reach the State Tax Committee and social funds on time.

Personal Income Tax (PIT)

Personal income tax is generally levied at a flat 12% on an employee’s taxable employment income, withheld at source by the employer. You calculate PIT on gross salary after any statutory exemptions, withhold it each payroll cycle, and remit it monthly to the State Tax Committee under the employee’s tax identification number.

Employers are responsible for accurate calculation and timely payment, and under-withholding can result in penalties, interest, and potential joint liability for unpaid tax. Late or incorrect filings can also trigger audits and restrictions on certain tax clearances, so your payroll system should reconcile PIT each month and match it to the official electronic reporting forms.

Unified Social Contributions

Employers in Uzbekistan typically pay unified social contributions of around 12% of gross payroll to cover social insurance, unemployment, and related statutory benefits, with some sectors or small businesses qualifying for reduced rates under special regimes. These contributions are employer-funded and are not deducted from the employee’s net pay, but they must be reported alongside salary and PIT data.

Payments are usually due monthly, and failure to contribute correctly can affect employees’ access to social benefits and pensions, as well as expose your company to fines and late-payment interest. The authorities closely monitor discrepancies between reported wages, PIT, and social contributions, so consistent data across all filings is essential.

Mandatory Pension And Insurance Contributions

In addition to unified social contributions, employers commonly fund mandatory pension and insurance-related contributions that together add roughly 1%–3% of payroll, depending on the applicable scheme and sector. These may include contributions to the state pension fund and workplace accident or occupational disease insurance, calculated as a percentage of gross wages without a high cap.

These contributions are reported and paid monthly along with other payroll taxes, and non-compliance can lead to penalties and potential liability for unprotected workplace risks. Ensuring that your chart of accounts separates pension and insurance contributions from general social contributions will make audits and reconciliations far easier.

How To Pay Employees In Uzbekistan

Employees in Uzbekistan are most commonly paid via bank transfer in Uzbek soum, and salaries must generally be denominated and settled in local currency even if contracts reference foreign currency. Monthly pay cycles are standard, with many employers paying at the end of the month or within the first few days of the following month, and you must ensure that payroll taxes are withheld and remitted in the same period.

If you do not have a local entity, you can use an Employer of Record to hire and pay staff compliantly, or work with a local payroll partner while you register your own legal entity and tax accounts. Payslips should clearly show gross salary, bonuses, overtime, personal income tax withheld, social and pension contributions, other deductions, and net pay, and they are typically provided electronically or in writing for each pay period.

Payment Method: Use local bank transfers in Uzbek soum to employees’ accounts registered with Uzbek banks.
Pay Frequency: Set a consistent monthly pay date aligned with your internal cut-off for tax withholding and reporting.
Payslip Content: Include gross earnings, itemised allowances, PIT, social and pension contributions, other deductions, and net pay.
No-Entity Hiring: Engage an Employer of Record to handle contracts, payroll, and statutory filings if you lack a local entity.
Local Entity Route: Once registered, open a corporate bank account and obtain tax and social fund IDs before running payroll.
Record Keeping: Store payroll records, contracts, and payslips securely for the statutory retention period in case of audits.
Cut-Off Management: Set internal deadlines for timesheets and changes so you can process payroll and remit taxes on time.

Payroll Set Up Checklist (Entity Vs No-Entity)

Getting payroll set up correctly in Uzbekistan determines how smoothly you can hire, pay, and stay compliant with tax and social security rules. With your own entity, you control employment contracts and filings directly, while a no-entity approach using an Employer of Record lets you operate quickly without navigating every registration yourself.

Whichever route you choose, you must align employment terms with the Labour Code, register with the State Tax Committee and social funds, and configure systems to calculate and remit payroll taxes accurately. A structured checklist helps your HR and finance teams avoid missed registrations, incorrect rates, or late submissions.

Decide Structure: Choose between setting up a local entity or using an Employer of Record based on headcount, timeline, and risk appetite.
Register For Taxes: Obtain a taxpayer identification number with the State Tax Committee and register as an employer.
Social Fund Registration: Enrol with relevant social insurance and pension funds to enable statutory contributions.
Open Bank Accounts: Set up a local currency corporate bank account dedicated to payroll and tax payments.
Draft Local Contracts: Prepare employment agreements compliant with Uzbek labour law, including salary, hours, and leave.
Configure Payroll System: Implement software or a provider that supports Uzbek tax rates, reporting formats, and deadlines.
Define Payroll Calendar: Establish monthly cut-off dates, paydays, and tax payment dates aligned with legal requirements.
Internal Controls: Set approval workflows for new hires, salary changes, and terminations to keep payroll data accurate.
Data Protection: Put in place secure storage and access controls for employee personal and payroll data.

Example Of Salary Tax Calculation

Assume an employee earns a monthly gross salary of 8,000,000 UZS. You would first calculate the 12% personal income tax on the taxable salary, then apply employer social and pension contribution rates, which together might total around 13%–15% of gross payroll depending on your classification.

The result is a clear breakdown of net pay for the employee and total employment cost for your company, which includes gross salary plus employer contributions. Documenting each step in your payroll system ensures consistency and makes it easier to explain payslips and respond to any tax authority queries.

Step 1 – Determine Gross: Confirm the monthly gross salary of 8,000,000 UZS including fixed allowances.
Step 2 – Calculate PIT: Apply 12% PIT to 8,000,000 UZS to get 960,000 UZS of income tax withheld.
Step 3 – Employer Contributions: Apply employer social and pension rates totalling, for example, 14% to reach 1,120,000 UZS in employer contributions.
Step 4 – Net Pay: Subtract 960,000 UZS PIT and any employee-side deductions from gross to arrive at net salary.
Step 5 – Total Cost: Add 1,120,000 UZS employer contributions to the 8,000,000 UZS gross salary to see the full monthly employment cost.

Submitting Employee Tax In Uzbekistan

In Uzbekistan, payroll taxes and contributions are typically filed electronically via the State Tax Committee’s online portal, with payments made through local bank transfers referencing the correct tax codes and periods. To submit accurately, you need each employee’s tax ID, your company’s registration details, the payroll period, and reconciled figures for PIT, social contributions, and other levies.

Online Portal Filing: Upload or enter monthly payroll data into the State Tax Committee e-filing system using your corporate credentials.
Bank Transfer Payments: Pay PIT and contributions from your corporate bank account using the correct budget classification codes.
Payroll Software Integration: Use software that can generate compliant electronic files and summaries for direct upload.
Third-Party Provider: Engage a local payroll provider or Employer of Record to handle filings and payments on your behalf.
Reconciliation Process: Reconcile portal confirmations, bank statements, and payroll reports each month to catch discrepancies early.

Payroll Tax Due Dates In Uzbekistan

Tax Type	Due Dates
Personal Income Tax Withholding	Monthly, generally payable and reportable by the 15th of the following month.
Employer Social Contributions	Monthly, due by the 15th of the month following the payroll month.
Mandatory Pension Contributions	Monthly, paid together with social contributions by the 15th of the following month.
Workplace Accident Insurance Contributions	Monthly, usually aligned with social contribution due dates by the 15th of the following month.
Annual Payroll Summary Reporting	Annually, typically submitted to the State Tax Committee by 1 April of the year following the reporting year.
Employee Income Statements To Authorities	Annually, usually by 1 April for the preceding calendar year.

Running Payroll Processing in Uzbekistan

So, what does it actually take to run payroll in Uzbekistan? It involves calculating monthly salaries, applying the right statutory deductions, and making sure your team gets paid accurately and on time, while staying fully compliant with local tax and labour laws.

Let’s walk through what that looks like in practice:

Monthly Payroll Workflow

Gather all the essentials: hours worked, leave taken, new joiners, leavers, and any salary or benefit changes.
Double-check timesheets, leave balances, overtime, and any variable pay to make sure everything is accurate.
Work out gross earnings, including base salary, bonuses, commissions, and allowances.
Apply mandatory and voluntary deductions, like income tax, pension contributions, benefits, and any company-specific deductions. Then, calculate net pay after all deductions.
Run internal reviews, compare with previous payroll cycles, and get the necessary approvals.
Pay employees via bank transfer and share payslips through email or your payroll system.
Send statutory payments and required reports to tax authorities.
Update your records and ensure payroll entries flow correctly into your accounting system.
Share payroll summaries with finance and address any open questions or discrepancies.

How Playroll Streamlines Processing

Keeping track of all these steps, especially in a new market, is no easy task. Regulations change, requirements shift, and it’s easy for things to fall through the cracks. Playroll makes this effortless by managing the entire payroll process for you: onboarding employees, handling calculations and deductions, issuing payslips, transferring funds in Uzbekistani Sum, and taking care of statutory filings and compliance.

Income Tax And Social Security In Uzbekistan

Understanding the tax obligations for both employers and employees is crucial when operating in Uzbekistan's business landscape. This section explains how taxes and statutory fees affect payroll and individual earnings in Uzbekistan.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 13% - 15% on top of the employee salary in Uzbekistan. This range typically covers unified social contributions, pension-related payments, and mandatory insurance, though specific rates can vary by sector and special regime.

Tax Type	Tax Rate
Unified Social Contribution	12%
State Pension Fund Employer Contribution	1%
Workplace Accident Insurance	0.5%–2% depending on risk category
Unemployment And Social Protection Levy	0.1%–0.5% depending on regime
Voluntary Supplementary Pension (If Offered)	Employer-defined, often 1%–3%

Employee Payroll Tax Contributions

In Uzbekistan, the typical estimation for employee payroll contributions cost is around 12%.

Tax Type	Tax Rate
Personal Income Tax On Employment Income	12%
Employee Pension Contribution (If Applicable Under Specific Schemes)	1%–2%
Trade Union Dues (If Employee Is A Member)	Typically 1% of salary, voluntary
Voluntary Supplementary Pension Contribution	Employee-defined, often 1%–5%
Other Voluntary Deductions (e.g. Charitable)	As agreed with employee

Individual Income Tax Contributions

Individual income tax in Uzbekistan is primarily based on a flat rate applied to most employment income, with certain exemptions and deductions defined in tax legislation. Some categories of income may be taxed at different rates, so employees with multiple income sources should review their overall position.

Income Bracket	Tax Rate
0 – 12,000,000 UZS per year	12%
12,000,001 – 36,000,000 UZS per year	12%
36,000,001 – 72,000,000 UZS per year	12%
Over 72,000,000 UZS per year	12%

Pension in Uzbekistan

Pension provision in Uzbekistan is built around a state pension system funded mainly by employer contributions and, in some cases, supplementary employee or employer payments. Many international employers also offer voluntary private pension or savings plans to enhance retirement benefits and remain competitive in the local talent market.

Managing Common Payroll Challenges in Uzbekistan

Global employers operating in Uzbekistan often encounter unique payroll challenges that can affect compliance and efficiency, like navigating evolving tax laws and managing employee data. With a need for real-time accuracy, modern organizations must develop strategies to overcome these challenges effectively. Below, we explore some of the most common payroll hurdles and provide actionable solutions to streamline payroll processes in Uzbekistan.

Maintaining Accurate And Detailed Payroll Reports

Maintaining accurate global payroll reports is often challenging due to currency exchange complexities, data integration issues, and the need to keep employee information up-to-date –including tax information, hours worked, leave balances, and any changes in salary or job status. Generating accurate reports is easy with a comprehensive payroll automation tool that consolidates fragmented data sources, and can keep track of employee payments and deductions.

Keeping up with ever-changing tax laws & Compliance Laws

In Uzbekistan, tax laws and compliance regulations can change frequently, presenting a significant challenge for global employers. Monitoring updates to federal, state, and local tax codes is crucial to avoid non-compliance and costly penalties, but requires significant time and resources. Partnering with local experts or a reputable global HR platform is an effective way to maintain compliance. These services can help employers stay compliant with evolving regulations while freeing up time for more strategic work.

Consolidating Multi-Vendor Payroll Analytics

Managing payroll across multiple vendors often leads to fragmented data and inefficiencies, making it difficult to consolidate analytics. These challenges can hinder decision-making, especially when trying to gain a clear view of workforce costs and trends. To address this, organizations can invest in a centralized payroll management system that unifies data from multiple vendors. A consolidated platform simplifies payroll tracking, ensures data accuracy, and provides actionable insights into payroll expenditures.

Integrating Multiple HR & Payroll Systems

Global companies are prone to using multiple HR or payroll systems across regions, which can easily lead to fragmented payroll data, increasing the risk of delays and errors in employee compensation. To combat this, seamless integration between payroll and other systems is critical.

Payroll management systems that connect with existing HR and financial platforms can help streamline workflows by reducing manual inputs and ensuring that all departments operate with up-to-date, accurate information. In turn, this helps guarantee on-time, accurate payroll, boosting employee satisfaction.

How Playroll Can Streamline Payroll & Taxes In Uzbekistan

Expanding globally is an exciting milestone for any company, but it comes coupled with complex payroll challenges. It doesn’t have to be complicated. At Playroll, our easy-to-implement global payroll management software combines automation with hands-on support to make global payroll truly simple. Here's how Playroll helps:

Multi-Vendor Integration: Our platform syncs seamlessly with your providers and in-house systems to unify global payroll services in one platform.
Standardize Payroll Processes: Unify your operations in one dashboard to ensure payroll is running smoothly globally, with advanced approval flows and reports.
Improve Governance & Compliance: Improve compliance by centralizing all your compliance tasks and processes. Easily track your payment obligations, with digitized audit trails.
Advanced Reporting: Access and configure your data, your way, with a comprehensive suite of payroll analytics and reporting tools.

Disclaimer

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.

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