Doing Business in Russia

Filing and payment Generally, individual entrepreneurs, Russian legal entities, representative offices and branches of foreign legal entities registered in Russia and which make payments to individuals, are all considered as tax agents. They are required to withhold PIT from the compensation payable to individuals and remit the associated PIT to the Russian financial authorities. If PIT was not withheld by a tax agent, the latter must notify the tax authorities and the individuals who received the income that was not subjected to tax withholding. The onus then falls on the individuals to pay the outstanding PIT based on a tax assessment issued by the tax authorities (by 1 December of the year following the reporting year). In other cases where an individual received income taxable in Russia which was not subject to withholding, the individual must file a PIT declaration and pay the outstanding tax after self-assessment. Generally, the PIT declaration should be filed no later than the 30th April of the year following the reporting year the item of taxable income was received, and the tax should be paid by 15th July of that year. Specific rules may apply to non-Russian citizens who depart from Russia. Tax refund A PIT declaration should also be required if individuals want to claim certain tax deductions or refund the PIT which was withheld by the tax agent (under certain circumstances). Other taxes payable by individuals Personal property tax Houses, apartments, cottages, garages and other buildings, along with premises and constructions owned by individuals are all subject to personal property tax. Tax rates differ - from 0.1% to 2%- depending on the type and value of the property. The rates may be adjusted by regional laws. - Certain categories of taxpayers are exempt from personal property tax (e.g. pensioners). Individual property tax is assessed by the tax authorities annually and should be paid by taxpayers based on a tax assessment issued by the tax authorities not later than the 1 October of the subsequent calendar year. Individuals who possess immovable property are subject to personal property tax. Land tax Individuals owning land plots are subject to land tax. The tax is assessed by the tax authorities on the cadastral value of the land plot. The tax rate depends on the type of land plot and regional laws; it should not exceed 1.5% of the cadastral value of the land plot. Individuals who possess land plots are subject to land tax. Transport tax Individuals owning transport vehicles are subject to transport tax. Taxable vehicles include automobiles, motorcycles, scooters, buses/ coaches, airplanes, helicopters, motor vessels, yachts, sailing boats, ships, snowmobiles, etc. Transport tax is determined based on the vehicle's engine power, seating capacity and the respective tax rates established by regional laws. Individuals possessing transport vehicles are subject to transport tax. Doing Business in Russia 43 Nizhniy Novgorod ©2016 KPMG. All rights reserved.

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