Doing Business in Russia
28 Doing Business in Russia
Customs Union
The legislation of the Eurasian Customs
Union between Russia, Belarus,
Kazakhstan, Armenia and Kyrgyzstan
(the Customs Union) establishes
special VAT rules with respect to
transactions between citizens in
the different member states of the
Customs Union. The export of goods
from one member state to another
is subject to a zero-percent VAT rate.
The zero-percent VAT rate should be
supported by provision of the relevant
documents, including documents
showing the application to import the
goods and that the import VAT has
been paid. The documents should be
stamped by the tax authority of the
member state where the goods were
exported.
The import of goods from one member
state to another is subject to import VAT
in the other member state. A taxpayer
is obliged to submit a separate VAT
return with respect to the import of
goods from the other Customs Union
country.
VAT Payable to the Russian State
Budget
VAT payable to the Russian state
budget is generally determined as the
difference between the amount of
output VAT accounted for on supplies
subject to VAT, and the amount of input
VAT incurred on purchases (plus the
amount due to be paid to the budget in
special cases) in a respective tax period.
An excess of input VAT over output
VAT could be refunded to the taxpayer
from the state budget upon submission
of a special application. Generally,
VAT refunds can only be made after
the tax authorities have performed
a 'desk tax audit' and confirmed the
legitimacy of the input VAT claimed.
Since 2010, taxpayers have also been
entitled to VAT refunds through use of
the accelerated VAT refund procedure,
which generally allows them to receive
a cash tax refund prior to completion
of the desk tax audit. However, this
procedure can apply only if the taxpayer
has paid RUB7 billion of taxes for three
consecutive years, or if the taxpayer
provides a bank guarantee, or if it is
resident in a territory classified as being
of "advanced social and economic
development", or a resident of the port
of Vladivostok.
VAT Payment and Filing
VAT returns should be submitted
quarterly in electronic form by no later
than the twenty-fifth day of the month
following the quarter that has ended.
Generally, the VAT should be paid by
Moscow
one third of the amount due by the
twenty-fifth day of each of the three
consecutive months following the
reporting quarter.
Taxpayers submit VAT returns
on a quarterly basis and pay
the VAT in three equal monthly
installments.
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