Personal income tax - Personal income tax

Main article: Taxes in Russia

2024

The largest tax reform in the modern history of Russia. Transition from 2 to 5 stages of personal income tax

In May 2024, the Ministry of Finance of the Russian Federation made proposals for the largest tax transformation, when taxes change at the same time, both on individuals and on business (personal income tax, income tax, USN, MET and a number of other changes).

The current progression in personal income tax has two levels - the base rate of 13% for income up to 5 million and 15% for income over 5 million rubles. From 2025 there will be 5 steps with a lower cut-off for accrued income of 2.4 million rubles per year, and the range of rates from 13 to 22%.

• 13% for income below 2.4 million rubles per year.
• 15% for income from 2.4 to 5 million rubles per year
• 18% for income in the range from 5 to 20 million rubles per year
• 20% for income in the range from 20 to 50 million rubles per year
• 22% with income over 50 million rubles.

For income from investments (dividends and interest), the rate will be flat 15% for income over 2.4 million rubles per year.

The principle of applying the rates from the excess amount, i.e. if the income of 10 million, respectively, 2.4 million is calculated at 13%, the next 2.6 million rubles before the cut-off of 5 million at 15% and the remaining 5 million at 18%. In this case, the effective rate will be slightly more than 16%, the total amount of taxes is 1.6 million, with the current tax legislation, the effective rate is 14% or 1.4 million, which is just over 200 thousand rubles of overpayment.

Spydell Finance calculated what effective rate and the amount of overpayment will be in accordance with the initiative of the Ministry of Finance:

• Revenues 3 million - 13.4%, now 13%, overpayment 12 thousand
• 3.5 million - 13.62 %/13 %/22 thousand, respectively
• 4 million - 13.8 %/13 %/32 thousand
• 4.5 million - 13.93 %/13 %/42 thousand
• 5 million - 14.04 %/13 %/52 thousand
• 6 million - 14.7 %/13.33 %/82 thousand
• 7 million - 15.17 %/13.57 %/112 thousand
• 8.5 million - 15.67 %/13.82 %/157 thousand
• 15 million - 16.68 %/14.33 %/352 thousand
• 20 million - 17.01 %/14.5 %/502 thousand.

The compensation will include a tax refund of 7 pp out of 13% paid for families with two or more children, if the total income of the family does not exceed 1.5 living wages per person. Tax increases do not apply to participants in the SVO in Ukraine.

The increase in personal income tax will affect only 3-3.5% of taxpayers.

Entry into force of the unified personal income tax rate for remote workers at 13-15%

On January 1, 2024, a law came into force, according to which the income of employees remoters working under labor contracts with a Russian organization or a division of a foreign company registered in Russia will be recognized as income from sources in the Russian Federation. The personal income tax rate for such employees was set at 13% (15% from income over 5 million rubles per year), regardless of the status of tax residency.

As the lawyer of the international tax planning practice BGP Litigation Linda Kurkulite explained to RIA Novosti, the main feature of the unified personal income tax rate of 13-15% for remote workers, which many forget, is that such employees must have a provision on remote work in the employment contract, otherwise the measure will not be applicable. Then there are general rules: the employer first retains 13% or 15% of personal income tax from the employee's income, and after losing his Russian tax residency - 30%.

In Russia, from January 1, 2024, a single personal income tax rate for remote workers was established at 13-15%

The law began to apply only to full-time employees of companies. From 2025, the rate of 13% or 15% will be subject to the income of freelancers when at least one of three conditions is met: the contractor is a tax resident of Russia, he receives remuneration to an account with a Russian bank or he is paid by Russian organizations, individual entrepreneurs, separate divisions of foreign structures in Russia.

According to Kurkulite, in order to understand whether such income will be taxed abroad, it is necessary to analyze the provisions of agreements on the avoidance of double taxation between Russia and the jurisdiction, the tax resident of which will be recognized by the taxpayer, and also check whether the agreement is currently valid.^[1]

2023

Putin set the personal income tax rate for Russians working from abroad at 13-15%

Russian President Vladimir Putin signed a law introducing a single personal income tax rate for remote workers. The document was published on the official portal of legal information on July 31, 2023.

Previously, companies registered in Russia had to independently determine the tax rate for "remote workers" depending on each specific situation. The amendments approved in July 2023 were designed to establish a single tax rate of 13-15% for them regardless of the tax residency status of remote employees. This is due to the fact that with a remote format of the company's work, it is difficult to check whether their employee was a Russian tax resident or not.

Vladimir Putin

Regardless of their tax status (they are tax residents or not), remuneration and other payments received for fulfilling labor duties will be subject to personal income tax at a rate of 13%. If the threshold of 5 million rubles per year is exceeded, the rate will be 15%. As the tax service explains on its official website, such revenues will relate to income from sources in the Russian Federation.

This procedure will also apply to the income of employees who have concluded an agreement with a separate division of a foreign organization registered in the Russian Federation. An exception will be made only for contracts concluded by citizens with separate units of Russian organizations registered outside Russia.

To pay tax, it is necessary that one of the conditions is met: the contractor receives funds to an account with a Russian bank or payments are made by Russian companies or separate divisions of foreign organizations in Russia. Tax residency is lost when staying outside the country for more than 183 days per year.

Russian Federation Federal Law on Amendments to Parts One and Two of the Tax Code of the Russian Federation

Personal income tax revenues in the first quarter fell by 20.2% to 950 billion rubles

According to the results of the first quarter of 2023, personal income tax revenues fell by 20.2%, the Ministry of Finance reported in a preliminary assessment of the implementation of the consolidated budget of the Russian Federation. In monetary terms, personal income tax fees decreased by 250 billion rubles. and amounted to 950 billion.

2022

Fees from wealthy Russians to the budget exceeded 1 trillion rubles

In 2022, revenues to the consolidated budget from personal income tax collected at a rate of 15% (instead of the standard 13%) amounted to 1.013 trillion rubles. Vedomosti wrote about this at the end of June 2023 with reference to materials for the draft law on budget execution for 2022.

It is noted that the indicators of 2022 showed an increase compared to the previous year - then the fees amounted to 636 billion rubles. At the same time, the amount of income directly from the increased personal income tax rate amounted to 142 billion rubles in 2022, which is 59 billion rubles more than a year earlier.

Such an increase in 2022 is associated with an increase in income from personal income tax received from dividends against the background of high payments, the Ministry of Finance explained. Also, additional charges of the Federal Tax Service for income received in 2021 made their contribution to the growth of the indicator.

The increased personal income tax rate - 15% - is used for Russians with an annual income of more than 5 million rubles. This corresponds to a monthly salary of 416.7 thousand rubles. and higher. Moreover, tax is charged not from the entire income of an individual, but only from that part of it that exceeds 5 million rubles a year. The rest of earnings are taxed at a rate of 13%.

The federal treasury receives 2% of the tax out of 15%, the rest is distributed to regional budgets. At the end of 2022, 882 billion rubles were allocated to regional budgets against 553.7 billion rubles in 2021.

In 2022, many companies made profits much higher than in previous years, which also had a positive effect on the income of citizens in connection with the payment of bonuses, bonuses, as well as increased dividends, adds Yulia Kovalenko, associate professor of the Department of Financial Control, Analysis and Audit of the Russian University of Economics. Plekhanov. In addition, at the end of 2022, nominal salaries increased by 12.6%, the expert noted in a conversation with the newspaper.^[2]

The Ministry of Finance has developed a bill on personal income tax at a rate of 30% for emigrated remote workers

Ministry of Finance prepared a bill according to which the rules for taxing remote employees the Russian companies that operate from abroad are tightened. They will soon be forced to pay 30 percent of their income. Perhaps in this way officials want to return the left specialists in. Russia However, loopholes to save on taxes for them remain. This became known on August 3, 2022.

The Ministry of Finance has long promised to revise its tax policy for employees of Russian companies who work remotely abroad. And after tens of thousands of specialists left Russia since the beginning of the year, work boiled over in the financial department - the ministry officially announced the beginning of the development of the relevant document.

Until now, Russian companies have preferred simply not to formalize employees abroad. Although there is no formal ban on work abroad in the Labor Code, the Ministry of Labor has always opposed this. According to officials, abroad, the employer cannot provide the employee with decent working conditions, and since inspectors are not given foreign business trips for constant control, employers should not prescribe "place of work - foreign jurisdiction" in employment contracts. Some of the large companies managed to challenge this order in court, but usually employers preferred not to pay attention to the fact that the employee works from Georgia or Turkey, and charged him the required 13 percent of income tax, as usual.

The Ministry of Finance has always been condescending to remote workers and regularly noted in its letters: if the employee's foreign workplace is officially indicated in his employment contract, then for the first six months he must independently file a return and pay tax in the amount of 13 percent, and having ceased to be a tax resident of Russia (this happens automatically after 183 days after moving), the employee is exempted from the need to transfer to the Russian budget.

In 2022, employers began to massively register remote employees as working from abroad - the benefit of such a step significantly outweighs the risk of litigation with the labor inspectorate.

According to the Accounts Chamber, the budget began to lose tens of millions of rubles. As the demographer notes, an employee of the RANEPA Yulia Florinskaya, about 150 thousand people left Russia, and these are only representatives of the IT sphere. And although four days after the start of a special military operation, the Ministry of Digital Development proposed a whole package of measures (from a delay from the army to a preferential mortgage) designed to stop the emigration of IT specialists, apparently, this did not bring the expected effect.

The Ministry of Finance announced the development of a bill that will cover the "benefit for remote employees" in advance, apparently so that specialists can return to Russia and avoid possible problems with the tax office. As the ministry noted in its press release, "the remuneration paid by domestic employer organizations to remote workers outside the country refers to income from Russian sources." After that, he clarified his intentions in the official Telegram channel.

The main purpose of the proposed amendments to the Tax Code of the Russian Federation is to exclude the practice of non-payment of personal income tax from payments to remote workers who do not receive tax resident status in any state or receive such status in a low-tax jurisdiction. This artificially makes working in Russia for Russian companies - both in the office and remotely - less attractive compared to the same work, but remotely, outside the country, the financial department said.

Thus, if nothing changes for remote workers who are residents of Russia, then remote employees working abroad will have to pay income tax of 30 percent to the Russian budget.

The meaning of the new law is not only to remove this loophole from the legislation. With this document, the Ministry of Finance will give the tax service a reason to constantly monitor the departure of people from Russia and check the deadline for their residency. After all, they do not pay taxes at an increased rate (30 percent) not only from those incomes that they receive from the employer, but also from others - for example, from renting out the housing remaining in the Russian Federation.

Theoretically FTS , it can now establish the status of a taxpayer using the border service, asking her information how many days a person spent in Russia. But this can not always be done - in particular, if a person went abroad through. Belarus This project of the Ministry of Finance is likely to eliminate this collision.

However, the idea of ​ ​ the Ministry of Finance in its current form contains a good loophole for those who do not want to pay 30 percent tax. A company employee can re-register as. In self-employed this tax regime, citizens pay a special tax on professional income at a rate of 4 or 6 percent until they exceed the income threshold of 2.4 million rubles a year. And the change of tax residency to the tax rate for the self-employed does not affect^[3]

2021

Russian owners of foreign companies reduced tax payments to regions by 15%

Russian owners of foreign companies in 2021 reduced tax payments to the regions of the Russian Federation by 15% - to 3.45 billion rubles against 4.05 billion rubles in 2020. This is evidenced by the data of the Federal Tax Service (FTS), which RBC published in mid-February 2022.

The decline occurred after the entry into force of a new voluntary procedure for paying income tax for beneficiaries of controlled foreign companies (CFCs), which allowed them to fix the amount of payment of 5 million rubles. The volume of revenues from the CFC in the new payment procedure in 2021 exceeded 1.22 billion rubles - this is 35% of the total personal income tax collected from the owners of foreign companies for the year.

Russian owners of foreign companies reduced tax payments to regions by 15%

The owners of the CFC were given a choice - to pay taxes in a new or old order, which involves personal income tax in the amount of 13% of the organization's profit and 15% if the company's taxable base is more than 5 million rubles. At the end of 2021, about 245 people used the new method of tax payment.

Two-thirds (66%) of income tax with the CFC at the end of 2021 were paid by residents of Moscow against 51% in 2020. Then a significant amount of personal income tax was recorded in the Lipetsk region (1.16 billion rubles, or 29% of the total). But in 2021, the flow of these payments practically stopped.

With the introduction of a fixed amount of income tax for beneficiaries of controlled foreign companies, those who wanted to hide their income continued to do so, and budget revenues decreased by several hundred million rubles, Vladimir Tikhomirov, chief economist at Macro-Advisory consulting company, told RBC. He believes that people who paid tax under the new scheme considered it simply more profitable, and did not decide to leave the gray zone.^[4]

The Ministry of Digital Development wants to oblige foreign IT companies to pay personal income tax on the salaries of employees from the Russian Federation

In early March 2021, it became known about the proposal of the Ministry of Digital Development to oblige foreign IT companies to pay personal income tax on the salaries of employees from Russia. Due to this initiative, set out in the plan developed by the department to stimulate the development of the IT industry, its authors expect to increase the number of "individuals engaged in IT activities in the legal field" and, accordingly, increase revenues from such activities to the budget.

The corresponding bill is planned to be prepared by mid-2021. According to sources Sheets"," such a measure will be submitted to the Deputy Prime Minister for consideration. Dmitry Chernyshenko

It will allow to equalize the conditions for doing business between foreign and Russian companies that pay taxes in full in our country, the press service of the Ministry of Digital Development told the newspaper.

Ministry of Digital Development proposes to equalize the conditions for doing business of foreign and Russian companies

According to a TASS source, the Russian Information Agency in the IT industry, foreign companies use Russian human capital and do not pay taxes for Russian employees, and then they can offer better salary conditions.

Finally, the conditions for doing business for Russian and foreign companies in this part will be equal, - said the agency's interlocutor, who knows that the second package of measures to support the IT industry may include an obligation for foreign technology companies operating from a foreign jurisdiction to pay personal income tax on a par with Russian ones.

As Tatyana Shkolnaya, deputy director of the Institute of Tax Management and Real Estate Economics of the Higher School of Economics, explained to Vedomosti, shadow schemes are often used in the IT sphere, in which calculations are not tied to the taxpayer's location. As a result, he does not pay income tax at all.

In Russia, the income tax rate for individuals is relatively low, which stimulates Russian programmers hired by foreign companies to work remotely while maintaining the status of a tax resident of the Russian Federation, said Ilya Gorshkov, a lawyer at the International Law and Taxes practice of the Lemchik, Krupsky and Partners law firm.^{[5] [6]}

2020: Vladimir Putin signed a law to increase personal income tax on income of more than 5 million rubles to 15%

On November 23, 2020, it became known that from January 1, 2021, the personal income tax rate on income exceeding 5 million rubles per year will increase. Until the threshold of 5 million rubles is reached, income will be taxed at a rate of 13%, everything above - at a rate of 15%. This proposal was made by the President of the Russian Federation.

"The funds received from such an increase will be directed to the treatment of children with severe and rare diseases," the Chairman noted earlier. "Moreover, STATE DUMA Vyacheslav Volodin this is an additional one - financing all existing federal and regional programs aimed at treating children will be preserved."

According to the Government of the Russian Federation, 60 billion rubles will go to the budget by the end of 2021, 64 billion rubles by the end of 2022, 68.5 billion rubles in 2023.

On November 10, 2020, 18 amendments were adopted in the second reading. It also added that one-time incomes of citizens (for example, insurance payments, amounts received from the sale of property) exceeding 5 million rubles will be fully taxed at a rate of 13% and will not be taken into account in total income for the year.

This procedure for collecting personal income tax will apply, in particular, to salaries, dividends on shares, income from operations with securities.^[7]

Calculator for calculating additional personal income tax charges by the tax inspectorate

1. From the column "tax base," the line "total amount," subtract 5 million rubles = A 2. The result obtained from claim 1 (A) shall be multiplied by 15% = B 3. Add up 650 t. (this is 5 million * 13%) and item 2 (B) = C 4. From item 3 (C) subtract the amount of the column "tax amount calculated by the tax agent...," line "total amount" = D 5. As a result, the result of item 4 (D) should be equal to the amount in the column "amount of tax payable," the line "total amount."

Notes