Law and regulation of Covid-19 tax relief in Russia

Value Added Tax

  • N/A

Corporate Income Tax

  • Small and medium enterprises belonging to negatively affected sectors of economy will benefit from tax payment deferrals (except for VAT and taxes they withhold as a tax agent) for a period of three to six months (depending on the type of tax) for taxes and social contributions due in 2020.;

Social Security Contributions or Payroll Tax

  • Micro-enterprises are granted with a deferral for social contribution payments (to apply together with tax deferrals);
  • Cumulative social contributions rate for small and medium enterprises is reduced from 30% to 15%.

Other relief measures

  • A “green channel” at a customs and an exemption from customs duties payment “for certain socially important goods have been introduced on a temporary basis;
  • A number of deferrals concerning communications with the tax authorities (such as conduction of ongoing tax and customs field audits, initiation of new tax and customs audits, provision of documents and data based on requests from the tax authorities, implementation of corrective measures or suspension of operations on bank accounts) have been introduced;
  • Deferral of sales tax payment as well as advance payments for property and land taxes until 31 December 2020 has been introduced in Moscow for certain categories of the taxpayers;
  • A six-month moratorium for insolvency claims and claims for debt collection has been introduced for certain companies;
  • The deadlines for filing financial and tax reporting and making certain tax payments due in 1st and 2nd quarters 2020 have been prolonged (to be determined separately for each type of tax);

Additional comments

  • In order to replenish the Russian budget, the following measures have been introduced:
    • 15% withholding tax on outbound income payments (dividends and sometimes interest) from Russia is currently being negotiated with certain jurisdictions.
    • Respective changes are expected to be incorporated to the applicable DTTs  and will likely apply only to “transit jurisdictions”, the list of which is yet to be determined.
    • Based on the publicly available information, Russian Federation has already addressed Cyprus, Malta and Luxembourg  to start negotiations over changes to the DTTs;
    • 13% personal income tax on interest income received by individuals from bank deposits and investments in debt securities (if total investments exceed 1 mln. RUB / appr. 12 kEUR), to apply starting from 2021.