In this page: Corporate Taxes | Accounting Rules | Consumption Taxes | Individual Taxes | Double Taxation Treaties | Sources of Fiscal Information
Standard corporation tax | Generally 20%: 3% of revenues is allocated to the federal budget, whereas 17% is allocated to the budgets of the relevant constituent regions (the regions may reduce such allocation to 13.5%) |
Additional withholding tax for foreign companies on their income that is not obtained by their permanent establishment in Russia | from 10% to 20%, depending on the type of income and the method used to calculate it |
Dividends received by a Russian entity | 13% |
Foreign tax credit is available but may not exceed the amount of Russian tax payable on foreign income.
Starting from December 2022, the Russian Government Commission has enforced a "contribution" charge of 10% on the transaction price for any change of ownership of a Russian subsidiary. However, in March 2023, the fee was modified to 5% based on the fair market value of the Russian subsidiary.
R&D expenses are deductible within one year after completion (in some cases they can be multiplied by a coefficient of 1.5). Furthermore, a provision for future R&D expenses may be accrued for tax purposes.
Losses in the form of bad debts that are written off are usually deductible. Charitable contributions deductibility is capped at 1% of revenues (conditions apply). Taxes are generally deductible, fines are not.
Regarding net operating and capital losses, the amount of a recognised loss of periods prior to 1 January 2017 cannot exceed 50% of the current year tax base for corporate income taxation purposes. Starting from 2021, recognition of the entire amount of losses became possible again. The carryback of losses is not permitted.
Numerous tax incentives are available, including regional tax reductions for investment projects, tax reductions for technology and software companies, a ten-year tax holiday for the Skolkovo Innovation Centre, a 0% profits tax rate for specific educational and medical services and a 150% profits tax deduction for qualifying R&D expenditure. Since 1 January 2021, regions may also establish investment tax credits for R&D activities. Other special tax regimes (e.g., regional investment projects, special investment contracts, or “territories of advanced social and economic growth”) grant a 0% profit tax rate, property tax reduction, and other benefits.
From 01.01.2023, Federal Law 269 of 05.07.2023 united the Russian Pension Fund and the Social Insurance Fund into a new fund - the Russian Pension and Social Insurance Fund. Hence, there is now a unified insurance contribution tariff applicable to mandatory pension insurance contributions, mandatory social insurance contributions for temporary incapacity for work and in connection with maternity and mandatory health insurance contributions.
The single tariff for these categories of contributions is set as follows:
The unified maximum insurance contribution base in 2024 is equal to RUB 2,225,000.
Russia | Eastern Europe & Central Asia | United States | Germany | |
---|---|---|---|---|
Number of Payments of Taxes per Year | 9.0 | 13.9 | 10.6 | 9.0 |
Time Taken For Administrative Formalities (Hours) | 159.0 | 226.2 | 175.0 | 218.0 |
Total Share of Taxes (% of Profit) | 46.2 | 36.5 | 36.6 | 48.8 |
Source: The World Bank - Doing Business, Latest data available.
An environmental fee must be paid by manufacturers and importers of goods to be disposed of after they are no longer fit for use or consumption (paper and paper products, rubber and plastic products, textile and leather, metals, and electronics). Other taxes include Water Tax, Transport Tax, Biological Resources Use Fee, Minerals Extraction Tax, and Gambling Tax.
Residents and foreign highly skilled specialists | 13% for income up to RUB 5 million 15% on the excess (at the time of publishing, the Russian parliament is reviewing draft Bill No. 363564-8, introduced on 22 May 2023, proposing a new top income tax rate of 30% for resident individuals with annual incomes exceeding RUB 10 million) |
Non-Residents | 30% (15% for dividends) |
Excess interest income and Awards and prizes received during contests, games, and other events conducted for the purpose of advertising goods, work, and services, in excess of set limits |
35% of their value |
Tax deductions are available for property-related allowances, social allowances, business expenses and standard allowances. Qualifying gifts and inherited property are tax exempt.
Donations to certain non-commercial organisations and qualifying charities are deductible from taxable income within certain limits. Individuals can deduct from taxable income the costs of their own and their children's education in Russian-licensed institutions (up to RUB 50,000 per child), as well as the costs of medical services (for themselves and close relatives) and medicines.
Expenditures incurred by an individual on the acquisition or construction of an apartment or house and related plot land, as well as payment of interest on the respective loans, are allowed as a deduction of up to RUB 2 million with respect to expenditures plus the amount of interest of up to RUB 3 million (available only to tax residents and only once). Taxable income from the sale of property (except for immovable property) owned for less than three years may be decreased by expenses incurred, or by a minimum deduction of RUB 1 million (for immovable property owned for less than five years), and RUB 250,000 (for other property, except securities).
Certain statutory allowances, state pensions (and certain other pensions) and revalued shares (issued as a result of statutory revaluation, merger or reorganisation) are exempt from taxation.
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Latest Update: July 2024