How to File a Personal Income Declaration in Russia

Author: Dmitry Paranyushkin (on 11 Mar 2020)
The easiest way to file your personal income declaration in Russia is electronically through the tax office's website www.nalog.ru or using their app (Android or iPhone) — Налоги ФЛ. To register, you would need to first get your universal tax number (INN in Russian, ИНН — индивидуальный номер налогоплательщика), which you can also apply for online (you will need to visit the office though to get it). Once you receive your INN, you can log in your personal space online and file your taxes. This should be done not later than the 1st April of the year following the year when you received your income (so, for example, if you received any income in 2019 you have until the 1st of April 2020 to submit your tax declaration and pay the tax).
 
If you need help filing your taxes, you can ask help from a professional tax adviser in Russia. They would help you set up your status properly and advise on your tax liabilities depending on your status.
 
The best way to file the declaration is to do this online, because you can follow the instructions of the tax service and specify all the right details. However, if you don't want to deal with it, you can also ask for a consultant to help you.
 
 

Highly Skilled Workers in Russia pay a Reduced Income Tax

If you are a highly skilled worker, you would have a reduced income tax. Even if you are a non-resident, you'd pay 13% on your income. For the purposes of taxation the highly skilled workers are either
 
• University professors, teachers, lecturers invited by a government institution who receive a payment higher than 1 Mln R (€15000) per year (can be in several transfers or in one payment). The type of visa you have doesn't matter in this case: you could have a university visa or a business visa, or also a long-term work visa.
 
• Individuals who work at the Skolkovo innovation center (no limit on the salary). In this case you can get paid even if you don't have a work visa: you can be on a standard business visa.
 
• All other workers who have a yearly salary of more than 2 Mln rubles (€30000). If you fit into this category you need a work visa for your application to be valid.
 
 

How to Submit Your Personal or Company Accounts in Russia

You would be able to submit your accounts online (after you get a digital signature) and the Russian banking system is pretty well developed, so once you set everything in order you would be able to work on your accounts remotely.
 
If you are acting as a physical person entity, you'd have to file your taxes using the NDFL-3 form. You could do this online, as explained above, or using a Russian tax laywer.
 
If you registered as a sole trader / entrepreneur in Russia simplified tax system status, you'd need to send your reports every 3 months. There are a few different kinds, but there are many companies that offer digital accounting services for about €20 a month. One that we can recommend is Elba Contur or Moe Delo — both will submit your accounts online and remind you when they are due. You would only need to visit their office once to set up the digital signature.
 
Obviously, because your costs would be about $240 a year plus your minimum tax per annum on the simplified tax system is about $300, it makes sense to open a company in Russia only if you plan to earn more than $1800 in that year from the sources in Russia. Of course, it becomes much more attractive if you also want to move your other business to your Russian company in which case you will probably save on taxes as the 6% revenue tax rate is much lower than what you get in other countries around the world.

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DISCLAIMER: The information in this article does not constitute legal advice and we take no liability, financial or otherwise, that may arise from using or not using the information provided in this article. We are not lawyers and do not provide legal services ourselves. To get a professional legal advice, please, contact the lawyers we recommend in this article as they can give you an official response for any tax-related question you might have, which you can then use in court or when dealing with authorities.



 

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