Ready For These Changes To Russian Accounting And VAT Laws?

Companies operating in Russia, or looking to expand their business there, need to be aware of several accounting and tax regulatory changes which could impact their enterprise.

Federal Laws 335-FZ and 350-FZ are amending parts one and two of the Russian Tax Code, specifying – in particular – new rules for accounting for, and payment of, VAT. Some amendments came into force on 1 January this year; the remainder come into force on 1 January next year.

VAT changes

This year's amendments include changing the procedure for allocating input VAT related to VAT exempt sales. VAT on goods and property rights bought for making solely non-VAT-able transactions cannot be claimed as input credit, but instead should be included in the acquisition of goods and property rights. The 5% rule will now apply to indirect expenses only.