Go to main page

Branch offices and representation offices of foreign organizations registered in Russia must pay taxes in accordance with tax legislation of Russian Federation.

The regulations on registration of foreign companies establish that foreign companies must be registered with the tax authorities regardless of the existence of conditions which create tax obligations according to Russian legislation and international agreements.

Below are the procedures for submitting the various tax reports for a representation (branch) office of a foreign company.

VAT

A tax declaration must be filed with the local tax authority not later than the 20th of the month following the fiscal period (quarter).

PIT

Separate subdivisions of foreign organizations in Russia also must calculate, withhold, and pay PIT and other obligatory payments for the employees of the representation (branch) office.

Moreover, the representation (branch) office of foreign company may be required to submit to the local tax authority personal income tax records with the sums of accrued and withheld taxes for a fiscal period annually not later than April 1 of the following year.

Insurance contributions for compulsory pension, medical and social insurance

Entities (organizations) making payments to individuals must pay compulsory pension, medical, and social taxes. This includes representation (branch) offices of foreign companies in Russia.

Profit Tax

Foreign companies, conducting business activity in Russia through a permanent establishment must file profit tax reports.

The term “permanent establishment” in this case is used as understood by the tax authorities. According to the tax authorities, a permanent establishment is any separate subdivision or other location of foreign company’s business activity in Russia, a foreign company conducting entrepreneurial activity in Russia, or carrying out such activity on a regular basis.

After every fiscal period, taxpayers must file a tax declaration with local tax authorities according to location of the company and its separate subdivisions even if no tax is owed.

Foreign companies that do not conduct business activity in Russia through a permanent establishment are not exempt from filing tax reporting (including profit tax declarations) with the Russian tax authorities.

Accounting periods for profit tax reporting (including for foreign companies) are the first quarter, half-year and first nine months of the calendar year.

In addition, foreign companies conducting business activity in Russia through representation (branch) offices must file annual reports of their activity in Russia at year-end.

Property Tax

Foreign organizations conducting business activity in Russia through permanent establishments must pay property tax on movable and immovable property as capital assets.

Foreign companies conducting business activity in Russia without permanent establishments pay taxes on real estate located in Russia owned by the company.

Other Taxes

Tax declarations for other taxes are filed by the company’s representation office in cases when it is recognized as the tax payer for a particular tax.

Back to the news list