2015 Summary of Tax Changes

It’s December and it’s time to strike balance in tax innovations in 2015 in Russia. During the year we counted about 50 considerable changes in tax regulations that came into effect in 2015.

In this executive summary style article we’ll only touch upon regulatory changes that concern most businesses.

In GreenLane we put 2015 tax innovations in 3+1 Groups:

(1) Encouragement (or enforcement, which ever you choose) of electronic, paperless reporting.

(2) Major changes in VAT reporting (measures against tax evasive cash-out transactions via shell companies)

(3) Employee related taxes and penalties, including foreign employees (taxing of foreign employees, measures against social&income tax minimisation schemes)

(4) Miscellaneous: dividends tax increase (9 to 13%); tax monitoring opportunity for big biz; good bye LIFO.

Today we will dwell on Groups 1 and 2.

Group (1) Encouragement (or enforcement, whichever you choose) of electronic, paperless reporting.

Extended deadlines for electronic reporting of employees social taxes.

Employees social taxes reporting deadlines extended. Deadlines for electronic reporting of employees social taxes more liberal (+5-10 days as compared to paper based).

Social Insurance Fund +5 days for paper based reports (20th of the month following the reported quarter) and +10 days for electronic reports (25th date)

Pension and Medical Tax reporting deadline extended only for electronic reports. Electronic RSV-1 Form will be due until 20th of the second month following the reported quarter. Deadline for paper based reporting unchanged (15th)

VAT declaration now due +5 days (5 days later in 2015). The deadline shifted from 20th to 25th of the month following the reported quarter (may be shifted due to holidays).

More businesses must report social taxes electronically. The 'must report social taxes electronically' limit decreased from 50 to companies with 25 or more employed (annual average number of employees counted).

If you report electronically, you must (1) furnish reception of electronic correspondence from Tax Office and (2) electronically confirm reception/acceptance of every electronic document from Tax Office in max six working days.

Tax Office now have more legal grounds to block your bank account.

Reliable e-correspondence with your Tax Office is critical for your operations
Reliable e-correspondence with your Tax Office is critical for your operations.

 

Some of the grounds are:

(a) tax declaration more than 10 days past deadline (regardless of business activity or dormancy);

(b) non confirmation of receipt of Tax Office correspondence (see the item above);

(c) paper based VAT declaration is now equated to 'no declaration’; penalty of 5% of non-reported VAT for each month overdue applies.

Group 2 - Very important changes in VAT reporting in 2015. As part of government measures against tax evasive cash-out transactions by shell companies.

New VAT declaration e-form has new chapters in it. Businesses must input purchase&sales ledger data. This allows immediate automatic cross-audit and exposure of abuse upon electronic reporting.

New format allows immediate automatic cross audit and exposure of abuse upon electronic reporting.New format allows immediate automatic cross-audit and exposure of abuse upon electronic reporting.

This is a big thing. Tax inspectors will request supporting documents, tax invoices and other documents (e.g. contracts) if they expose discrepancies in automatic cross audit of electronic seller and buyer tax reports (see above).

The documents may be requested in case the discrepancies will evidence understated VAT or overstated recoverable tax.

GreenLaneTips wish you zero contact with Tax Authority in the new year;))

To be continued...

 

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