CFC declaration campaign 2019

Dentons tax experts would like to remind you that 20 March 2019 is the deadline for filing notifications of controlled foreign companies (“CFC”) with the Russian tax authorities. Controlling persons must file CFC notifications in respect of corporate and non-corporate CFC (trusts, funds, partnerships). In 2019, controlling persons must declare CFC profits or losses that were recognized by Russian taxpayers in 2018.

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Development of court practice on notification of participation in foreign entities and of controlled foreign companies

January 2019 was marked by an upsurge in court activity in considering issues related to Russian companies’ filing of notices of participation in foreign entities and notices of controlled foreign companies (СFСs). Four cases considered by the Moscow Commercial Court caught our attention at once: the Moskabelmet,[1] INFRASTRUKTURA TK,[2] Almera[3] and Inspektorat R cases.[4]

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Expiration of the second round of the Russian voluntary disclosure (capital amnesty) campaign and the tax-exempt liquidation of CFCs

Dentons’ Russian Tax team would like to remind you that 28 February 2019 is the deadline for filing a special declaration with the Russian tax authorities to participate in the voluntary disclosure campaign (the so-called “capital amnesty campaign”).[1] In addition, Russian tax resident individuals must liquidate their controlled foreign companies and non-corporate structures (trusts, partnerships and others) no later than 1 March 2019 for tax-exempt receipt of the liquidation proceeds.

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New capital amnesty

On 19 February 2018 the President of Russia signed three federal laws[i] which extended the capital amnesty campaign and timeframes for tax-exempt liquidation of foreign companies and unincorporated structures. Continue reading “New capital amnesty”

Indirect sale of real estate in the Russian Federation in the context of the beneficial ownership rules

On 17 January 2017 the Commercial Court of Vladimir Oblast delivered a judgement in case No. А11-6602/2016 (the “Decision”) under the claim of Vladimir Energy Retail Company[1]  Public Joint-Stock Company (the “Company”). Continue reading “Indirect sale of real estate in the Russian Federation in the context of the beneficial ownership rules”

Complying with legal requirements on controlled foreign corporations

Dentons’ Russia Tax practice would like to remind readers that starting in 2017 individuals and legal entities that are deemed Russian tax residents must annually file notices about foreign entities and unincorporated structures that meet the criteria of controlled foreign corporations of Russian tax residents set by the Russian tax legislation. The Federal Tax Service (FTS of Russia) approved the form and procedure for completing the notice about controlled foreign corporations with its Order No. MMV-7-13/679@ dated 13 December 2016 (the Order is currently being registered with the Ministry of Justice). In addition, in 2017 Russian tax residents must declare the retained earnings of controlled foreign corporations for 2015 as their income and pay profit tax (for companies) or personal income tax (for individuals) on them.

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Recent developments of court practice concerning the documentary support for deductibility of expenses attributable to a permanent establishment of a foreign company in the Russian Federation

On 21 December 2016 the Commercial Court of Moscow delivered the Decision in case No. А40-121559/16-20-1035. In this case the court considered a dispute between ZAB Zementanlagenbau GmbH Dessau (Germany), which carries out business in Russia through a permanent establishment in Moscow (the “PE”), and the Federal Tax Service of Russia Interdistrict Inspectorate No. 47 for the City of Moscow (the “Inspectorate”). Continue reading “Recent developments of court practice concerning the documentary support for deductibility of expenses attributable to a permanent establishment of a foreign company in the Russian Federation”