In some cases a foreign company’s activity in Russia leads to a permanent establishment creation. For example:
Note!
If a foreign company’s activity in Russia meets the permanent establishment, such foreign company must register as a CIT payer in Russia.
The CIT rules are very complex.
Moreover, the DTT rules must be used. In 2021, Russia has 84 double taxation treaties with other countries.
Permanent establishment example:
A building contractor from Austria is charged with a project in Russia lasting more than 12 months.
It will be a permanent establishment of an Austrian company in Russia
What do you need for the proof of permanent establishment?
We can provide you with the services relating to the preparation and processing of the PE (Permanent Establishment) registration application in Russia with the Tax Authorities. Such services generally include:
We provide our services in Russia, Belarus, Kazakhstan, Ukraine.
A permanent establishment in Russia can be recognized by the following criteria: • separate fixed place of activity, through which a foreign company regularly engages in business activities in Russia (a branch ("filial"), representative office, division, bureau, office, agency, or any other). • regularly of activities in Russia (more than 30 days in a year) • entrepreneurial nature of the activity A PE will not be generally deemed to exist in case the performed activity is preparatory or auxiliary in nature.
A bank account would not create a permanent establishment. But holding a bank account creates an obligation to register the Russian tax authorities.