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The taxation of companies in Russia underwent comprehensive reform
in 2001.
The basic rate of Corporate Tax applicable to a Russian enterprise,
or a foreign corporation with a permanent establishment in Russia,
is between 20% and 24%.
This is made up of 5% payable to central government, between 13%
and 17% payable to regional government and 2% payable to local
government.
Capital gains taxes are calculated on the basis
of gross proceeds from the sale, less acquisitions costs and depreciation
(if applicable) and are taxed at the rate of 24%.
The standard rate of withholding tax on Dividends
is 15% if the recipient is a foreign corporation and 6% if paid
to a Russian Federation, resident individual or corporation.
The former Double Taxation treaties of the USSR
are still valid and include 64 countries. If the appropriate Double
Taxation treaty country is utilised the standard rate of withholding
tax on the payment of dividend can be mitigated to 5%.
For further information on how best to structure
inward investment into Russia please contact our Isle
of Man, London, Finland
or Cyprus
offices.
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