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  • Selection of taxation system
    Selection of taxation system is one of the challenges entrepreneurs-beginners face with. This decision should be well-considered as how many taxes will be paid and how often the accounts will be filed depends exactly on it. It should be mentioned that foreigners who run a business in the Russian Federation with legal status of individual entrepreneurs have the right to use any of legally provided taxation systems (simplified, general, etc.). If a foreigner works in accordance with the general taxation system, he/she pays IIT – the Individual Income Tax. In these conditions the rate is a direct function of the time of staying in the Russian Federation at the moment of carrying out business activities. Thus, if a foreign citizen lives full-time on the territory of the Russian Federation within 183 and more days in the course of the year, he/she gets the status of a tax resident and pays 13% the Individual Income Tax. If the term of his/her staying in Russia is less than abovementioned, the tax increases up to 30%.

    For this very reason the Simplified Taxation System with tax rate of 6% of income or 10% of profit margin is more preferable for foreigners who often go abroad. In this case the fact whether the entrepreneur-beginner is a tax resident or not isn’t of paramount importance.

    At present there are 5 taxation systems in the Russian Federation. We can help you to choose the most effective one which will suit exactly to your business.

    1. The General Taxation System

    2. The Simplified Taxation System

    3. The Single Tax on Imputed Earnings (STIE)

    4. The Patent System of Taxation

    5. The Unified Agricultural Tax (UAT) – is projected only for agricultural producers who cultivate, process and sell agricultural products by their own.
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