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ARTICLE · 20 NOVEMBER 2014

Implications Of Latest Russian 'De-Offshorisation' Proposals

Elias Neocleous & Co LLC
Elias Neocleous & Co LLC
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Elias Neocleous & Co LLC

Elias Neocleous & Co LLC

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In September 2014 the Russian Ministry of Finance published the third version of the draft law on the package of tax initiatives generally referred to as 'de-offshorisation'.

CyprusTax
Elias Neocleous & Co LLC
Elias Neocleous & Co LLC
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Introduction

In September 2014 the Russian Ministry of Finance published the third version of the draft law on the package of tax initiatives generally referred to as 'de-offshorisation'. This draft differs from its predecessors in areas including the controlled foreign company (CFC) rules (particularly the parameters for classifying companies as CFCs), criteria for determining tax residence of foreign companies and penalties for non-disclosure.

Towards the end of October a draft law was presented to the Russian State Duma for consideration. The draft law differs in several respects from the third draft published by the Ministry of Finance.

Since Cyprus is one of the principal portals for investment into Russia (in 2013 it accounted for $22.7 billion, more than 13% of Russian inward investment), the proposed changes are of great importance for users of Cyprus structures. This update outlines the specific aspects that are likely to affect Cyprus structures.

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