Tax law and tax disputes

The timeframe is expiring for accepting applications of taxpayers from ‘affected’ industries regarding the deferral (instalment plan) of tax payments 30 November 2020 is the last day when the applications for granting a deferral (instalment plan) of tax payments is granted to entrepreneurs from industries most affected by Covid-19. At the same time, applications may be filed for any payments that become due in 2020 (including in December).

The Constitutional Court has explained the conditions for collecting corporate property tax based on cadastral value Pepeliaev Group advises that the Russian Constitutional Court has adopted Resolution No. 46-P dated 12 November 2020. This Resolution specifies in what cases a real estate facility can be treated as a shopping mall with the tax base calculated based on the cadastral value.

Less than two weeks before the compiling of the Register of SMEs that receive state support is complete The Russian Federal Tax Service (the "Service") has issued a reminder that 5 December is the final deadline for the submission of information by state and local authorities, the corporation responsible for the development of small- or medium-sized entrepreneurship and other organisations that provide support to SMEs.

Extension of the deferral for the payment of taxes and contributions granted to SMEs from ‘affected’ industries

The new rules for forming the register of SMEs will help entrepreneurs On 7 November, Federal Law No. 349-FZ dated 27 October 2020 came into force, which amended the legislation on developing SMEs.

Amendments to the Russian Tax Code to raise investment attractiveness of Russian companies Pepeliaev Group advises that Federal Law No. 368-FZ dated 9 November 2020 (the “Law”) has come into force which provides for a possibility to deduct a monetary contribution to a company’s property when a member withdraws from company, the company is liquidated or its membership interests/shares are sold. The Law has also introduced targeted amendments as to how an investment tax deduction should be applied.

The Federal Tax Service has published draft electronic forms and the formats of documents for conducting tax monitoring Pepeliaev Group advises that a draft Order of the Russian Federal Tax Service has been posted on the federal portal of draft regulations approving forms, and formats of documents, used for tax monitoring, as well as requirements for them. 

Additions to the CFC taxation rules: indulgence and an increase of pressure

A protocol has been prepared on amending the DTT with Luxembourg Pepeliaev Group advises that the Russian Government has prepared a draft of the DTT with Luxembourg that proposes changes in the taxation of dividend and interest income.

The Supreme Court’s position regarding the classification of income when double tax treaties are applied Pepeliaev Group advises that the Russian Supreme Court (the “Supreme Court”) has formed a legal position regarding the income of foreign entities being subject to Russian withholding tax.

The procedure for holding a mutual agreement procedure on DTT issues has been approved Pepeliaev Group advises that order No. 102n of the Russian Ministry of Finance dated 11 June 2020 approved the Procedure for a mutual agreement procedure application to be filed and reviewed in accordance with the provisions of a DTT .  

New approaches of the Russian Supreme Court to intra-group financing

Pepeliaev Group advises on a ‘substantive’ change in the approaches to the use of thin capitalisation rules.