Introduction
Despite sanctions, regulatory changes, and media noise, many European companies and private entrepreneurs continue to work with Russian clients, invest through local entities, or operate service exports to the Russian market.
Understanding how the Russian tax system applies to you — whether as a company or individual — is essential for risk management, compliance, and cost control.
At RT-Union – Turkish International Law & Consulting Firm, we help European clients structure their activity in Russia legally and tax-efficiently. Here's what you need to know in 2025.
Understanding how the Russian tax system applies to you — whether as a company or individual — is essential for risk management, compliance, and cost control.
At RT-Union – Turkish International Law & Consulting Firm, we help European clients structure their activity in Russia legally and tax-efficiently. Here's what you need to know in 2025.
Who Is a Tax Resident in Russia?
Under the Tax Code of the Russian Federation, an individual is considered a tax resident if they:
For legal entities:
A company is tax-resident in Russia if it is:
- Spend 183 days or more in Russia within any 12-month period,
- Regardless of visa type or citizenship.
For legal entities:
A company is tax-resident in Russia if it is:
- Registered in Russia, or
- Effectively managed from Russia (place of strategic management).
What Taxes Apply to Foreign Individuals?
- Tax: Personal Income Tax (PIT)
– Applies to: Russian tax residents
- Tax: PIT for non-residents
– Applies to: Certain types of income
- Tax: Dividend tax
– Applies to: Local and cross-border
- Tax: Real estate tax
– Applies to: Property ownership in Russia
- Tax: Social contributions
– Applies to: Not mandatory for foreign self-employed
RT-Union evaluates tax exposure and helps you structure income efficiently — e.g., via IP, holding, or relocation.
What About Foreign Companies Operating in Russia?
Foreign companies may have permanent establishment (PE) status, triggering corporate tax liability if they:
PE registration is mandatory — failure leads to tax penalties and backdated obligations.
- Have a branch, agent, or representative office in Russia;
- Sign contracts or conduct core business functions in-country;
- Provide services or software to Russian clients on a continuous basis.
PE registration is mandatory — failure leads to tax penalties and backdated obligations.
Russian Corporate Tax Rates (2025)
Tax Type: Corporate income tax
– Rate: 20% (15% федеральный, 5% региональный)
Tax Type: VAT (НДС)
– Rate: 20% (или 10% для отдельных товаров)
Tax Type: Withholding tax on dividends
– Rate: 15%
Tax Type: Withholding tax on royalties/interest
– Rate: 20% (если не применяется соглашение об избежании двойного налогообложения — DTA)
– Rate: 20% (15% федеральный, 5% региональный)
Tax Type: VAT (НДС)
– Rate: 20% (или 10% для отдельных товаров)
Tax Type: Withholding tax on dividends
– Rate: 15%
Tax Type: Withholding tax on royalties/interest
– Rate: 20% (если не применяется соглашение об избежании двойного налогообложения — DTA)
RT-Union helps you navigate Double Taxation Agreements (DTA) and assess the most efficient payment flows.
Double Taxation Treaties: Can You Avoid Being Taxed Twice?
Yes — Russia has DTA agreements with 80+ countries, including:
DTAs reduce withholding taxes and allow for tax credits or exemptions in your home country. However, the Russian tax authority may demand substance proof (e.g., tax residency certificate, beneficial ownership docs).
- Germany
- France
- Austria
- Italy
- Netherlands
- Switzerland
DTAs reduce withholding taxes and allow for tax credits or exemptions in your home country. However, the Russian tax authority may demand substance proof (e.g., tax residency certificate, beneficial ownership docs).
Case Example: Belgian Consulting Firm with Russian Clients
RT-Union helped a Belgian firm that:
We:
Result: full tax compliance in both jurisdictions with 0% exposure in Russia.
- Provided digital marketing services to Russian e-commerce clients
- Received payments to an EU-based entity
- Occasionally signed contracts under Russian law
We:
- Confirmed no PE risk
- Structured contracts to avoid Russian tax nexus
- Reviewed VAT status
- Drafted DTA-compliant tax statements for Belgian authorities
Result: full tax compliance in both jurisdictions with 0% exposure in Russia.
Frequently Asked Questions
Can I open a company in Russia as an EU citizen?
Yes — Russia still permits foreign ownership. RT-Union assists with incorporation, banking, and compliance.
Will my home country tax me again after I pay taxes in Russia?
Depends on your DTA. RT-Union coordinates with your accountant for optimal filing.
Is it safe to be paid from Russia?
Yes — with proper contract, documentation, and KYC routing, you can receive funds legally via SWIFT.
Do I have to report my activities to Russian tax authorities?
Only if you create a taxable presence or own real estate/business in Russia.
Yes — Russia still permits foreign ownership. RT-Union assists with incorporation, banking, and compliance.
Will my home country tax me again after I pay taxes in Russia?
Depends on your DTA. RT-Union coordinates with your accountant for optimal filing.
Is it safe to be paid from Russia?
Yes — with proper contract, documentation, and KYC routing, you can receive funds legally via SWIFT.
Do I have to report my activities to Russian tax authorities?
Only if you create a taxable presence or own real estate/business in Russia.
Why Work with RT-Union – Russian-Turkish Law & Consulting Firm
- Offices in Russia and Turkey
- Cross-border tax structuring for EU and CIS clients
- Support with PE, VAT, withholding, and transfer pricing
- Legal opinions and risk assessments for auditors
- Multilingual team (ENG/FR/DE/RU)
We don’t guess tax rules. We document, plan, and defend your position.
Clarify Your Russian Tax Position in 2025
🕊️ Working with Russian clients or owning assets in Russia?
Let RT-Union help you structure your activity legally and efficiently — even in a complex environment.
📞 Schedule a consultation with our tax & compliance team.
👉 Book a Tax Consultation
Let RT-Union help you structure your activity legally and efficiently — even in a complex environment.
📞 Schedule a consultation with our tax & compliance team.
👉 Book a Tax Consultation
