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Putin Signs Law to Crack Down on Offshore Tax Shelters
Putin Signs Law to Crack Down on Offshore Tax Shelters
Sputnik International
Vladimir Putin signs a law that limits offshore tax sheltering. The law will force Russian owners of foreign-based companies to inform the Federal Tax Service... 25.11.2014, Sputnik International
2014-11-25T11:02+0000
2014-11-25T11:02+0000
2014-11-25T13:11+0000
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Putin Signs Law to Crack Down on Offshore Tax Shelters
11:02 GMT 25.11.2014 (Updated: 13:11 GMT 25.11.2014) Vladimir Putin signs a law that limits offshore tax sheltering. The law will force Russian owners of foreign-based companies to inform the Federal Tax Service of their profits.
MOSCOW, November 25 (Sputnik) — Russian President Vladimir Putin has signed a law to limit offshore tax sheltering, according to a publication appearing Tuesday on the official database of Russian laws and legal documents.
26 October 2014, 14:53 GMT
The new law introduces an amendment to the Russian Tax Code that will force Russian owners of foreign-based companies to inform the Federal Tax Service of their profits. This modification introduces the notions of a "controlled foreign company" and a "controlling entity."
25 November 2014, 13:02 GMT
The controlling entity will be obliged to submit a tax declaration, a financial statement on the controlled foreign company and audit results. Taxes will be calculated with regard to the offshore company's income.
A separate provision in the "deoffshorization" law lists criteria that can classify a foreign company as a Russian tax resident. According to the Russian deputy finance minister, this could happen if a company's operational and strategic decisions are taken in Russia or if a company's income comes predominantly from operations in Russia.