List of agreements for the avoidance of double taxation. Double Taxation Treaty. How tax is deducted when making a profit from the sale of property abroad

International agreements on the avoidance of double taxation, applied in the territory of the Russian Federation, are included in the legal system of the Russian Federation and have priority over the provisions of the national tax legislation.

Article 15 of the Constitution of the Russian Federation establishes that international treaties of the Russian Federation are an integral part of its legal system, and if an international treaty establishes rules other than those provided for by law, then the rules of the international treaty are applied.

Similar rules are established by the Tax Code of the Russian Federation.

In this regard, when taxing foreign persons, it is necessary to proceed primarily from the provisions of international treaties in the field of taxation.

The international treaty referred to in the Tax Code of the Russian Federation may have various names in international law: treaty, agreement, convention, and others.

The purpose of concluding an international treaty is to reach an agreement between states or other subjects of international law that establishes their mutual rights and obligations in tax relations in order to avoid double taxation.

The issues of taxation of persons - residents of one state in relation to their income, paid in another state, are regulated by the legislation of these two countries. At the same time, any state has the exclusive right to levy taxes on its territory in accordance with national tax legislation, which applies, among other things, to foreign organizations.

It is for this reason that double taxation of foreign organizations arises when a person who is a resident of one country receives income from sources located in another country, owns property (usually immovable) in another country, or carries out activities that result in income or otherwise in another country. It is typical for these situations that one and the same person is considered by tax legislation as a taxpayer, or the same object is considered as an object of taxation in two or more countries simultaneously.

For example, income received by a foreign organization from sources in the Russian Federation is subject to taxation in the Russian Federation in accordance with the provisions of the Tax Code of the Russian Federation. Moreover, these incomes received on the territory of the Russian Federation are also subject to taxation in accordance with the legislation of a foreign state of the recipient of income. Accordingly, in this case, the tax is paid twice: the first time - in accordance with the tax legislation of the state - the source of income, the second - in accordance with the domestic legislation of the state - the recipient of the income.

The provisions of an international treaty determine the rules for delineating the rights of each of the states on taxation of organizations of one state that have an object of taxation in another state.

In addition, the amounts of tax paid in the state - the source of income in accordance with the domestic tax legislation of that state, may be deducted when the tax is paid by a foreign organization abroad. The procedure for offsetting paid taxes abroad is regulated by the tax legislation of a foreign state. In Russia, a similar procedure is applied, provided for in Article 232 of the Tax Code of the Russian Federation.

As a rule, the amount of credited taxes paid in the state - the source of income may not exceed the amount of tax payable by this organization abroad on the corresponding income, calculated in accordance with the tax laws and regulations of the foreign state. The offset is made subject to the presentation by the taxpayer of a document confirming tax withholding in the state - the source of income.

It should be borne in mind that the current international tax treaties (on the avoidance of double taxation) determine only the rules for delimiting the rights of each of the states to tax organizations of one state that have an object of taxation in another state, however, the methods for implementing these provisions: the procedure for calculating, paying tax, collecting tax amounts , not paid in due time, and prosecution for the violations committed by the taxpayer - establish the domestic norms of tax law.

In addition to eliminating double taxation, international agreements pursue the goal of developing mechanisms to prevent tax evasion and reduce the possibility of abuse of agreement norms in order to avoid tax through the exchange of information between the competent authorities of the respective states.

Double taxation treaties (treaties, conventions) - multilateral and bilateral agreements that establish the rules in accordance with which the avoidance of double taxation is achieved:

1) income received by individuals and legal entities;

2) property and income from the sale of property;

3) income and property in the field of international transportation;

Accordingly, double taxation in international economic relations may arise in relation to the following taxes:

1) personal income tax;

2) corporate income tax;

3) (both individuals and legal entities, and other laws).

Double taxation treaties usually contain:

1) enumeration of the types of taxes regulated by the agreement (article "Taxes to which the agreement applies");

2) determination of the circle of persons to whom the agreement applies;

3) determination and establishment of taxation conditions (tax restrictions) in the state - the source of income of such types of income as:

Profit from commercial activities;

Dividends;

Interest;

Income from dependent personal activities (income from employment);

Income from independent personal activities (remuneration and fees);

Other income;

4) determination of ways to avoid double taxation (exemption from taxation or the use of a foreign tax credit);

5) establishment of the procedure for the implementation of the agreement by the parties (entry into force, validity period, procedure for terminating the agreement, application of mutual agreement procedures).

Individual provisions of these Agreements differ from each other, since the Agreements are of a bilateral nature and are concluded on the basis of the nature of relations between Russia and a particular country. At the same time, many agreements are based on the Model Convention of the Organization for Economic Cooperation and Development (hereinafter OECD) on taxes on income and capital and contain similar provisions.

In this regard, it is possible to generalize the principles of income taxation in accordance with international agreements.

In order to apply agreements on the avoidance of double taxation concluded by the Russian Federation (the former USSR), income is divided:

1) for income (profit) from commercial activities;

2) for special types of income, for which special taxation regimes, tax exemptions, tax credits are provided.

Profit from commercial activities in the context of agreements on the avoidance of double taxation is recognized as income of foreign organizations operating through a permanent establishment in the Russian Federation.

For this type of income, the norms of agreements on the avoidance of double taxation, as well as the norms of the national tax legislation of a number of countries, establish the main taxation regime and standard forms of eliminating double taxation.

TO wasps Common types of income for which special taxation regimes and tax exemptions are provided include:

a) income from international transportation, dividends, interest;

b) income from immovable property, from the sale of immovable and movable property, from copyrights and licenses (intellectual property);

c) income from employment;

d) income from independent personal activities (professional services), fees of directors of enterprises, remuneration or other income from public service, pensions;

e) income of art workers and sportsmen, teachers, scientists, students and trainees;

f) other income.

Differences in approaches to the taxation of income from certain types of activities are determined by the specifics of these incomes, the conditions and nature of the activity, as well as the characteristic features of the activities of certain categories of tax subjects.

The clause of agreements "Profit from commercial activities" affects all types of income, except for those types, the taxation procedure for which is determined in special articles.

The relevant article of the agreement determines in which state this or that income or this or that part of it will be taxed. The very procedure for the taxation procedure, conditions and mandatory requirements are always established in accordance with the national legislation of the state that carries out taxation.

In the article of the agreement "Profit from commercial activities", the parties that have entered into the agreement consider profit as an object of taxation, that is, the difference between the income received and the expenses incurred to extract these income, and in the articles related to special types of activities, we are talking about income ...

In the presence of an agreement, profits from commercial activities derived in one contracting state by a person with a permanent residence in another contracting state may be taxed in the first state only if it is obtained through its permanent establishment (permanent establishment of a foreign organization) located there and only in that part which can be attributed to the activities of this permanent establishment. In this approach, the principle of territoriality finds its application, according to which only profits derived from sources located on the territory of this state are taxed on the territory of one state. The application of this principle of international agreements is usually concretized as follows: “If a person with a permanent residence in one contracting state carries out commercial or other economic activity in another contracting state through a permanent establishment located there, then in each contracting state such a permanent establishment includes the profit that he could have received if it were a separate and independent person, carrying out the same or similar activities under the same or similar conditions and acting completely independently. " Thus, on the one hand, those types of profit that a person receives from sources in a given country, regardless of the activities of the said representative office, do not belong to the profit of a representative office, and on the other hand, a possible underestimation of the amount of profit received by a person from the activities of his permanent representative office is prevented.

As a rule, the agreements provide a general description of the procedure for calculating the profit of a permanent establishment and indicate those types of expenses that are allowed to be deducted from taxable income to determine the object of taxation - profit received through a permanent establishment. In the Model Agreement, this is worded as follows: “In determining the profit of a permanent establishment, a deduction of expenses incurred for the purposes of the operation of that permanent establishment is allowed. In this case, a reasonable redistribution of documented expenses between a person with a permanent residence in one Contracting State and his permanent establishment in another Contracting State is allowed. Such expenses include management and general administrative expenses, research and development expenses, interest and management fees, consulting and technical assistance incurred both in the State in which the permanent establishment is located and elsewhere. "

The profit attributable to a permanent establishment should be determined annually by the same method, unless there is a compelling and sufficient reason to change it.

If the profit includes items of income that are separately mentioned in other clauses of the agreement, then the provisions of those clauses are not affected by the provisions of the clause "Profit from commercial activities".

The Russian Federation has concluded agreements with many states on the avoidance of double taxation.

Currently, over 70 international agreements (conventions, treaties) are in force. Along with the agreements concluded by the Government of the Russian Federation, the agreements concluded by the government of the USSR continue to operate.

The existing international agreements of Russia on the avoidance of double taxation of income and property differ significantly on a number of issues, including in some agreements special concepts and terms are often used.

In addition to general international agreements on the elimination of double taxation, there are a number of special bilateral agreements, mainly on the elimination of double taxation in the field of international (sea and air) transportation, concluded by the government of the USSR. Such agreements were concluded with the Algerian People's Democratic Republic (from 06/11/88), the Argentine Republic (from 03/30/1979), the Hellenic Republic (from 01/27/1976), the Iraqi Republic (from 09/26/1974), Ireland (from 12/17/1986), the French Republic (03/04/1970).

Russia is a member of the Geneva diplomatic and consular conventions, as well as the multilateral Convention for the avoidance of double taxation of royalties (Madrid, December 13, 1979).

In relations with individual countries in the 1990s, agreements between the countries of the Council for Mutual Economic Assistance continued to operate on the elimination of double taxation of income and property of individuals (concluded on May 27, 1977 in relation to Mongolia, Slovakia and the Czech Republic), as well as on the elimination of double taxation of income and property of legal entities (concluded on May 19, 1978; continued to operate with respect to the same countries).

An independent group is made up of bilateral agreements on the avoidance of double taxation of income and property of the Russian Federation with the CIS member states: the Agreement with the Republic of Azerbaijan (dated 03.07.97), the Agreement with the Republic of Belarus (dated 21.04.95), the Agreement with the Republic of Uzbekistan (dated 03/02/94; ratified on 04.24.95), with Ukraine (02/08/95).

For more details on issues related to accounting and tax accounting in foreign organizations on the territory of the Russian Federation, you can get acquainted in the book of JSC "BKR Intercom-Audit" "Foreign organizations and their representative offices".

Within the framework of this material, it is proposed to consider some of the most important formal legal aspects of the use of agreements on the avoidance of double taxation in Russia and related arbitration practice.

International agreements (treaties, conventions) on the avoidance of double taxation are applied when taxing income from international transactions, when income is paid by a resident of one state, and the recipient of such income is a resident of another state. If there is an existing agreement between these two states, then the tax-liable party has the right to expect a tax exemption on such income or to pay tax at a reduced rate (depending on the type of income).

The purpose of any bilateral agreement on the avoidance of double taxation is to ensure conditions under which legal entities and individuals of each country will not pay taxes twice on the same type of income in their country and in the partner country. Thus, tax agreements contribute to attracting mutual investments, developing trade and other mutually beneficial economic cooperation between companies and entrepreneurs from different countries. At the same time, such agreements are aimed at preventing tax evasion.

The Double Taxation Avoidance Agreement determines how taxation of various types of income is distributed between the two member states, and also establishes the procedure for levying withholding tax (that is, tax withheld by the party paying the income to the other party) when paying dividends, interest, royalties, lease payments etc. In some cases, the rate of such a tax is significantly reduced, in others - income is completely exempt from tax at the source.

Despite the fact that the conclusion of tax agreements is the prerogative of individual states, each of which independently determines with whom and under what conditions to conclude such agreements, the process of unification of the content of the agreements concluded is currently under way, primarily on the basis of the Model Convention on taxes on income and capital (Model Convention with Respect to Taxes on Income and on Capital), developed by the OECD (Organization for Economic Cooperation and Development).

At present, Russia has signed tax agreements with more than 80 states. Among them, many EU countries (including Cyprus, Great Britain, Ireland, Denmark, Netherlands, Luxembourg, etc.), Switzerland, USA, China, CIS countries (including Ukraine, Belarus, Kazakhstan), Baltic countries (Latvia, Lithuania ) and a number of others (see the complete List of existing agreements on the avoidance of double taxation).

It is important to remember that in the Russian legal system, the norms of agreements on the avoidance of double taxation (ratified and entered into force for the Russian Federation) take precedence over the provisions of tax legislation (which follows from part 4 of Article 15 of the Constitution of the Russian Federation and Article 7 of the Tax Code of the Russian Federation). For example, if the Tax Code of the Russian Federation provides for a tax rate of 15%, and in an agreement for the same income - a rate of 5%, then the rate established in the agreement will be applied (subject to the conditions provided for therein).

Each state party to a tax agreement must provide for an understandable mechanism for its practical implementation by its taxpayers, including all the formalities that must be completed by the taxpayer and the tax agent in order to take advantage of the benefits or exemptions provided for by the agreement. Practice shows that non-observance of these formalities, their too arbitrary interpretation or, conversely, a restrictive interpretation, may lead to the impossibility of timely taking advantage of the advantages provided by tax agreements. or entail measures of tax liability.

Confirmation of the permanent location of a foreign organization

In practice, this confirmation is often called "Certificate of tax residency" (tax residency certificate).

In accordance with clause 1 of Article 312 of the Tax Code of the Russian Federation, this confirmation must meet the following requirements:

• must be certified by the competent authority of the relevant foreign state;
• if this confirmation is made in a foreign language, the tax agent is also provided with a translation into Russian;
• confirmation must be provided by the foreign organization prior to the date of income payment.

The Tax Code of the Russian Federation, establishing the requirements for documents confirming the permanent residence of a foreign organization (clause 1 of article 312), does not establish the mandatory form of such documents. The only act containing requirements (sometimes excessive and not directly based on the Tax Code) to the form and content of confirmation of permanent location for the purposes of agreements on the avoidance of double taxation was the Order of the Ministry of Taxes and Duties of Russia dated 28.03.2003 No. BG-3-23 / 150 “On approval Methodological recommendations for tax authorities on the application of certain provisions of Chapter 25 of the Tax Code of the Russian Federation concerning the peculiarities of taxation of profits (income) of foreign organizations. " formally, they were not obligatory for the taxpayer to apply by virtue of paragraph 1 of Article 1 and paragraph 2 of Article 4 of the Tax Code of the Russian Federation)

These Methodological Recommendations will, most likely, be replaced either by additions to the Tax Code of the Russian Federation, detailing the taxation procedure for foreign organizations, or by the corresponding act of the Ministry of Finance, or by both. For the information of readers, we present some of the provisions of this document, which until recently retained their practical significance.

These recommendations said that documents confirming the location of a foreign organization may be certificates in the form established by the domestic legislation of this foreign state, as well as certificates in any form. These certificates are considered as confirming the permanent residence of a foreign organization in the event that they contain the following or similar wording in meaning: "It is confirmed that the organization ... (name of the organization) ... was (was) during ... (the period is indicated) ) ... a person with permanent residence in ... (the state is indicated) ... in the sense of the Agreement (the name of the international treaty is indicated) between the Russian Federation / USSR and (a foreign state is indicated) ".

Clause 5.3 of the Methodological Recommendations indicated that in the documents confirming permanent residence, a seal (stamp) of a competent (or authorized by him), in the sense of the relevant agreement on the avoidance of double taxation, of a foreign state body and the signature of an authorized official of this body are affixed. These documents are subject to legalization in accordance with the established procedure, or such documents must be apostilled.

In addition, the Methodological Recommendations noted that such documents as certificates of registration in the territory of foreign states (certificates of incorporation), extracts from trade registers, etc., cannot be considered as documents confirming the permanent location of the organization for tax purposes. in a foreign country.

The recommendations also indicated that “the tax agent is provided with only one confirmation of the permanent location of a foreign organization for each calendar year of payment of income, regardless of the number and frequency of such payments, types of income paid, etc.”.

Since some of the above provisions were often called into question in judicial and arbitration practice (a significant part of litigation is related precisely to the issues of documentary evidence necessary for the application of benefits and exemptions), we present the most significant positions of the arbitration courts.

1) The confirmation of the permanent location of the foreign organization must be certified by the competent authority of the foreign state in the sense of the relevant agreement on the avoidance of double taxation.

Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation (hereinafter - the Supreme Arbitration Court of the Russian Federation) dated September 20, 2011 No. 5317/11 . The Russian CJSC successfully challenged the decision of the Federal Tax Service Inspectorate in the Moscow Arbitration Court to recover a fine, tax and penalties from income paid to a foreign company. As confirmation of the location of a foreign organization in the United States, the Moscow Arbitration Court accepted certificate (registration certificate) signed by the Secretary of the State of Vermont and sealed by that state, certified by a notary as a genuine copy of the record on file with the Bureau of the Vermont Secretariat. The state secretary affixed an apostille to this certificate certifying the actions of a notary. The translation of the said document into Russian was carried out by a translator, whose signature is certified by a notary of the Republic of Latvia. The 9th Arbitration Court of Appeal and the Federal Antimonopoly Service of the Moscow District left the decision of the 1st instance court unchanged. However, the Presidium of the Supreme Arbitration Court of the Russian Federation noted the following.

The competent authorities in the United States of America are the Secretary of the Treasury or his authorized representative, and the US Internal Revenue Service (authorized to prove US tax residency).

In this case, the certificate of registration of a foreign organization in the state of Vermont defines its legal status as a business entity registered in the United States, however is not a proper confirmation the permanent seat of a foreign organization in the United States in the sense of the Treaty for the avoidance of double taxation, since said testimony has not been issued by the appropriate competent authority foreign state.<...>

The Supreme Arbitration Court of the Russian Federation recognized the arguments of the Federal Tax Service Inspectorate about the violation by the CJSC of the provisions of Chapter 25 of the Tax Code of the Russian Federation and partially overturned the decisions of lower courts in favor of the taxpayer.

Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated December 28, 2010 No. 9999/10. After evaluating the documents submitted by the company, the courts of first and cassation instances came to a reasonable conclusion that information on the registration of a limited liability company in the Republic of Cyprus and registration of another company in the Commercial Register of the Canton of St. Gallen in Switzerland it is not enough for them to acquire the status of persons with permanent residence in order to avoid double taxation, since such information does not indicate that these persons are also tax residents data from foreign countries ”. (At the same time, it is interesting that the court of appeal in this case, in contrast to the courts of first and cassation instances and the Supreme Arbitration Court, proceeded from the fact that the provisions of the RF Tax Code “allow a foreign organization to choose a document that would confirm its permanent residence. on the territory of a foreign state, since neither the norms of the Code, nor other legislative acts on taxes and fees have established specific bodies of a foreign state, which must issue confirmation of the place of permanent location of a foreign organization, as well as specific forms and texts of such documents. " , as we can see, was refuted by higher authorities).

At the same time, judicial practice takes a balanced approach to cases when companies provide not only certificates of tax residence, but also other documents (issued by both tax and non-tax authorities of foreign states), one way or another, indicating the permanent location of foreign companies in a certain state.

Determination of the Supreme Arbitration Court of the Russian Federation of November 7, 2013 No. VAS-15167/13 . According to the MIFNS, tax exemption certificate a German company and certificate of registration as a VAT payer in relation to another German company cannot be considered as evidence of the right to tax exemption in the Russian Federation, since they do not confirm the permanent location of foreign organizations in Germany. However, “on the basis of the provisions of Chapter 25 of the Code and the Agreement between the Russian Federation and the Federal Republic of Germany on the avoidance of double taxation with respect to taxes on income and property dated May 29, 1996,“ the courts recognized the documents submitted by the company in order to confirm the permanent location of its foreign counterparties in the Federal Republic of Germany, reliable and sufficient, therefore, we concluded that the income received by companies during the disputed period from the company is not subject to taxation on the territory of the Russian Federation ”. The Judicial Collegium of the Supreme Arbitration Court did not establish any violation by the courts of uniformity in the application of the provisions of Chapter 25 of the RF Tax Code.

Resolution of the FAS of the Far Eastern District of 11/14/2013 No. F03-5168 / 13 in case No. A73-31 / 2012 : along with certificates confirming the tax residency of companies in the Republic of Korea, when conducting an on-site tax audit in confirmation of the permanent location of foreign companies, enterprise registration certificates signed by the heads of tax inspectorates of the two counties of the Republic of Koreaissued before the date of income payment. Supreme Arbitration Court of the Russian Federation in his Definition dated March 26, 2014 No. VAS-716/13 did not establish any violations by the courts of uniformity in the application of the provisions of Chapter 25 of the RF Tax Code. The SAC, in particular, noted that “guided by the provisions of Chapter 25 of the Code and the Convention between the Government of the Russian Federation and the Government of the Republic of Korea for the avoidance of double taxation with respect to taxes on income from 19.11.1992, the courts recognized the documents submitted by the company in order to confirm the permanent location of its foreign counterparties in the Republic of Korea, reliable and sufficient, therefore, we concluded that the income received by foreign organizations from the society during the disputed period is not subject to taxation in the territory of the Russian Federation ”.

2) Proof of permanent residence of the foreign organization must be provided prior to the date of income payment.

Resolution of the Federal Antimonopoly Service of the Moscow District of February 15, 2013 No. F05-15470 / 12 in case No. A40-59278 / 2012 . In the cited case, “all confirmations were issued after the actual payment of income to foreign organizations. Thus, as of the date of payment of income, the company, as a tax agent, had an obligation to withhold taxes from the income paid ”. Whereas “a tax agent is exempt from withholding tax if he has a confirmation of the residence of a foreign organization before the date of income payment”. A similar position is also expressed in Resolution of the Federal Antimonopoly Service of the Moscow District of July 16, 2013 No. F05-7227 / 13 in case No. A40-72223 / 2012 .

3) Is confirmation required for each calendar year?

Until now, practice in most cases answered this question in the negative.

For example, in Resolution of the Federal Antimonopoly Service of the Volga District of July 30, 2013 No. F06-5981 / 13 in case No. A12-29089 / 2012 it is noted that the tax authority's reference to the fact that confirmation of the permanent location of a foreign organization must be submitted annually is untenable, since this is not provided for by tax legislation.

Ministry of Finance of Russia in its Letter dated April 14, 2014 No. 03-08-RZ / 16905 reported the following: “According to the literal interpretation of the provisions of paragraph 1 of Art. 312 of the Code, providing for confirmation of the permanent location of a foreign organization, it does not contain norms limiting the period of validity of such confirmations, due to the fact that the income of a foreign organization is not tied to the tax period (which is confirmed by the practice of arbitration courts). The provisions of paragraph 1 of Art. 312 of the Code only stipulates that confirmation must be submitted by a foreign organization before the date of income payment, and not in each tax period. ” However, “if, during the period since the confirmation was issued, the permanent location of the foreign organization changes, ... the tax agent will be responsible for the correct calculation and withholding of tax”.

However, a completely different point of view was demonstrated by FAS of the Moscow District in his Resolution of January 17, 2014 No. F05-16745 / 13 in case No. A40-16818 / 2013. “Since at the time of the payment of income the company did not have a certificate of residence of the said foreign company, relating to the specified tax periods, the applicant was brought to tax liability by the contested decision under Article 123 of the Tax Code of the Russian Federation and he was charged penalties for tax on income of foreign legal entities ”.<...> “As established by the courts during the consideration of the case and is not contested by the applicant, the income to the above foreign person was paid by the applicant in 2009 and 2010. At the time of payment of income tax agent has a certificate residence of the counterparty from 23.04.2008 in the Republic of Cyprus for 2008, which does not contain instructions for the extension of a similar conclusion regarding the status of residence for the future period. This certificate not reasonably accepted by the courtsas a basis for exemption of a tax agent from withholding tax at the source of payment at the time of income payment ”.

At the same time, immediately before the formulation of this conclusion, the FAS MO set out almost literally the exhaustive requirements of Article 312 of the Tax Code of the Russian Federation to confirm tax residency. It remains a mystery where in the court decision came the requirement that the tax residence certificate refer to certain tax periods (apparently, from the same revoked "Methodological Recommendations" of the Ministry of Taxes and Tax Collection of Russia 2003 ...)

Moreover, the Supreme Arbitration Court of the Russian Federation, in its Ruling of April 28, 2014, refused to transfer this case for consideration by way of supervision to the Presidium of the Supreme Arbitration Court of the Russian Federation, motivating it as follows. “When adopting the contested acts, the courts based their conclusions on the assessment of the content of the disputed certificates, guided by paragraph 1 of Article 312 of the Tax Code and the legal position of the Presidium of the Supreme Arbitration Court of the Russian Federation contained in Resolution No. 5317/11 of 20.09.2011.<...> The applicant's reference to judicial acts in other arbitration cases does not indicate a violation by the courts of uniformity in the interpretation and application of substantive law, taking into account the specific circumstances of the tax dispute established during the consideration of this case. The courts have not allowed the wrong application of the norms of substantive or procedural law entailing the abolition of the contested judicial acts ”.

4) Does the confirmation of permanent residence of a foreign organization have to be apostilled?

In general, the position of the courts confirms the need to affix an apostille on such documents:

Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation of June 28, 2005 No. 990/05 . The Presidium of the SAC concluded that the documents submitted to the withholding agent by foreign organizations (certificate of the US Treasury Department of the Treasury of the company in the United States; certificate of the London Department of Internal Taxes that the company is subject to taxation in the UK; and certificate of the UK Internal Revenue Service of companies in the UK) do not meet the requirements of the Convention (1961) for official documents, since they do not have an apostille. In this regard, the Presidium of the SAC noted that the documents submitted by the company as evidence confirming the location of foreign legal entities were lawfully not accepted by the tax authority.

However, there may be exceptions in relations with certain countries:

Resolution of the Federal Antimonopoly Service of the Moscow District of February 15, 2013 No. F05-15470 / 12 in case No. A40-59278 / 2012. The company presented tax certificates issued by the Ministry of Finance of the Republic of Serbia, confirming the residence of the Serbian company. The certificates were presented without an apostille, and therefore were not accepted by the inspection as proper evidence. The courts considered that the certificates presented by the company were not subject to apostille, but the courts' conclusion was erroneous. The FAS MO pointed out that the Treaty between the USSR and Yugoslavia "On Legal Assistance and Legal Relations in Civil, Family and Criminal Cases" dated February 24, 1962 (allowing the use of documents without legalization) “does not affect tax legal relations, which are inherently administrative law ”. The FAS MO concluded that “documents submitted by foreign organizations to a tax agent in order to confirm their permanent location on the territory of the Republic of Serbia, must in accordance with the requirements of the Hague Convention contain apostille”.

At the same time, the court noted that the Ministry of Finance of Russia, including represented by its authorized representative (FTS), on a reciprocal basis agreed with the competent authorities (their authorized representatives) of a number of foreign states on the procedure for accepting official certificates confirming permanent residence (residence) without legalization or apostille.The list of such states, as well as the forms of documents, samples of signatures of authorized persons and seals of state institutions of foreign states authorized to issue certificates of permanent residence, is contained in the information base of the Federal Tax Service of Russia. These states include the Republic of Belarus, Ukraine, the Republic of Moldova, the Republic of Kazakhstan, the Republic of Uzbekistan, the Kyrgyz Republic, the Republic of Tajikistan, the Republic of Armenia, the Republic of Azerbaijan, the USA, the Republic of Cyprus, the Slovak Republic (see Letter No. 26-2-08 / 5988).

In certain cases, the courts proceed from the fact that apostilization is not required:

Resolution of the FAS of the Far Eastern District of January 29, 2014 No. F03-6693 / 13 in case No. A51-4992 / 2013. Rejecting the inspectorate's argument about the need to affix an apostille on the documents submitted by a foreign (Japanese) company, the courts of both instances rightly pointed out that the tax legislation regulating disputed legal relations provided for a foreign organization to provide a tax agent with a confirmation, certified by the competent authority, that this the organization has a permanent residence in the state that has an international agreement with the Russian Federation. Society has fulfilled this condition. In turn, the inspectorate did not provide a legal basis for the requirement on the need to submit apostilled documents in this case.

Summarize.

• The body of a foreign state that is competent in the sense of treaties for the avoidance of double taxation, as a rule, is the financial or tax department (ministry of finance, tax office, internal revenue service, etc.). Such competent authorities of the contracting countries are defined directly in the text of the agreement. Ministries of Justice, trade registers, etc. authorities generally cannot be regarded as competent for the purposes of tax treaties.
• Proof must be provided to the withholding agent prior to the date of income payment.
• There is no requirement to provide confirmation annually (as there is no uniformity in arbitration practice on this issue).
• On confirmation. as a general rule, an apostille must be affixed. The exception is the confirmations coming from countries that have agreed with Russia within the framework of the mutual agreement procedure provided for by the tax agreement, a simplified procedure for the mutual acceptance of such documents without an apostille. Legal aid treaties containing provisions on mutual recognition of documents do not apply to tax relations.

So, in practice, the following option is often used: a certificate of tax residency received from a foreign counterparty (with apostille) is translated into Russian; the authenticity of the translator's signature is certified by a notary; the translation is attached to the original. Then, the required number of copies is made from the specified stitching, the correctness of each of which is also certified by a notary.

Duties and responsibilities of a tax agent

The withholding agent is obliged to transfer the appropriate tax amount no later than one day,following the day of payment (transfer) of funds to a foreign organization or other receipt of income by a foreign organization.

In accordance with paragraph 4 of Article 310 of the Tax Code of the Russian Federation, a tax agent, based on the results of the reporting (tax) period, within the time limits established for the submission of tax calculations by Article 289 of the Tax Code of the Russian Federation, provides information on the amounts of income paid to foreign organizations and taxes withheld for the previous reporting (tax) period in tax authority at the place of its location in the form established by the Federal Tax Service of Russia.

The form of such a calculation was approved by Order of the Ministry of Taxes and Tax Collection of Russia dated April 14, 2004 No. SAE-3-23 / 286 @ “On Approval of the Tax Calculation Form (Information) on the Amounts of Income Paid to Foreign Organizations and Taxes withheld” (as amended by the Order of the Federal Tax Service of Russia dated December 18, 2013 No. ММВ-7-3 / 628 @). Instructions for filling out the tax calculation (information) on the amounts of income paid to foreign organizations and withholding taxes was approved by Order of the Ministry of Taxes and Tax Collection of Russia dated 03.06.2002 No. BG-3-23 / 275 (as amended by Order of the Federal Tax Service of Russia dated 18.12.2013 No. ММВ-7 -3 / 628 @).

Tax agents submit tax calculations no later than 28 calendar days from the end of the relevant reporting period. Tax calculations based on the results of the tax period are submitted by tax agents no later than March 28 of the year following the expired tax period (clauses 3 and 4 of article 289 of the Tax Code of the Russian Federation).

During a tax audit (including an onsite one), a tax agent who has applied a reduced tax rate, at the request of the tax authority, is obliged to present confirmation of the location of the foreign organization - the recipient of the income.

It should be remembered that unlawful failure to withhold and (or) non-transfer (incomplete withholding and (or) transfer) within the time period established by the Tax Code of the Russian Federation of the amounts of tax to be withheld and transferred by a tax agent constitutes a tax offense and entails the collection of a fine in the amount of 20 percent of the amount, subject to withholding and (or) transfer (Article 123 of the Tax Code of the Russian Federation).

The status of "actual recipient of income" as a condition for the application of benefits provided by international tax treaties

In this regard, the Ministry of Finance of Russia (in the Letter dated April 9, 2014 No. 03-00-RZ / 16236) made an explanation, which marked a new approach to assessing the legality of taxpayers' application of benefits provided for by international tax agreements.

When applying agreements on the avoidance of double taxation in terms of granting the right to use benefits (reduced rates and exemptions) when taxing certain types of income from sources in the Russian Federation, it is necessary to assess whether a person claiming to use benefits (reduced rates and exemptions) , The “actual recipient (beneficial owner)” of the respective income.

The Ministry of Finance of Russia indicated that the direct recipient of income, although it can qualify as a resident, cannot, only for this reason, be considered by default as the beneficial owner of the income received in the state of residence.

The provision of tax benefits (reduced rates and exemptions) in the state that is the source of income paid to a foreign person is contrary to the goals and objectives of international agreements, if the recipient of such income, without formally using such instruments as agency or nominal holding, acts as an intermediate link in the interests of another person actually benefiting from the corresponding income. Such an intermediate link, for example, a conduit (i.e. intermediate. transit) company, cannot be considered as a person with the actual right to the income receivedif, despite its formal status as the owner of income in a transaction with a person who is a tax resident of the state - the source of income, such a company has very narrow powers in relation to this income, which allows us to consider it as a trustee or manager acting on behalf of interested parties.

For a person to be recognized as the actual recipient of income (beneficial owner), not only must there be a legal basis for the direct receipt of income, but this person must also be the direct beneficiary,that is, a person who actually benefits from the income received and determines its further economic destiny. When determining the actual recipient (beneficial owner) of income, one should also take into account the functions performed and the risks assumed by a foreign organization claiming benefits in accordance with international tax treaties.

According to the Ministry of Finance, provided for by agreements on the avoidance of double taxation benefits (reduced rates and exemptions)in respect of paid income from a source in the Russian Federation do not apply, if they are paid in a transaction or series of transactions carried out in such a way that foreign person claiming benefitsin the form of a reduced rate on dividends, interest and royalties, pays directly or indirectly all or almost all of the income (at any time and in any form) to another person who would not have benefits (reduced rates and exemptions) under the relevant agreement, if such income was paid directly to such person.

From all of the above, the following conclusions can be drawn:

1. When using the norms of agreements on the avoidance of double taxation, including when receiving confirmation of their permanent location from foreign counterparties, one should be guided, firstly, by the norms of the tax agreement itself, and secondly, by the norms of the Tax Code of the Russian Federation; and also take into account the arbitration practice and clarifications of the financial authorities (if any). Compliance with all the formalities associated with the application of the agreement on the avoidance of double taxation, can significantly reduce the risk of challenging the tax authorities of the legality of the application of benefits provided for by such an agreement;

2. The tax agent is responsible for the correct calculation and withholding of tax at source from income paid to foreign organizations (including the correct application of benefits (reduced rates and exemptions) provided for by agreements on the avoidance of double taxation).

3. For the lawful application of the benefits provided for by international tax agreements, the status of the recipient of income and the further fate of the income themselves have legal significance: the application of benefits will be legal only if a resident of a foreign state with which Russia has a tax agreement is the actual recipient (beneficial owner) corresponding income.

A tax resident of Russia, who is obliged to pay tax on income from assets in the world in the Russian Federation, is one who lives in the country for more than 183 days a year. In particular, many owners of overseas real estate who can receive income from rent or from the sale of housing fall under this definition. If they are Russian tax residents, then a situation arises in which they must pay taxes both abroad (at the location of the object) and in Russia (at the place of their tax residence). However, the tax cannot be levied twice: it is paid only abroad, and the difference is set off in Russia. This is provided for by agreements on the avoidance of double taxation.

Double Taxation Treaty - what is it?

A double taxation treaty is an agreement concluded between two countries that sets out the rules for levying taxes on organizations and individuals in cases where income-generating assets are not located in the country of residence of the recipient of the income.

The agreement on the avoidance of double taxation specifies the types of taxes that fall under the document, as well as the circle of persons to whom its norms apply. Also, such an agreement contains the terms of taxation, the duration and procedure for terminating the agreement. Russia has signed agreements on the avoidance of double taxation with 82 countries.

“As for, for example, income in Estonia or other countries with which Russia has not concluded agreements on the avoidance of double taxation, the residents of the Russian Federation pay taxes twice, in both countries. If Estonian legislation provides for the collection of tax from a non-resident, then the amount paid will not be taken into account in the Russian Federation, since the actually paid amounts of tax on income received in a foreign country are not counted when paying tax in Russia, unless otherwise provided by the relevant international agreement signed by the Russian Federation ", Says Ekaterina Shabalina, Tranio lawyer.

For buyers and owners of overseas real estate agreements on the avoidance of double taxation are important primarily because they allow you to deduct tax in Russia on income from rent and on the sale of such property.

How is tax taken into account when receiving rental income

“If a Russian resident receives income from real estate located, for example, in Germany, the amount of tax paid in Germany will be deducted from the amount of tax payable in Russia. The amount of tax is calculated in accordance with Russian tax law (at a rate of 13% and established rules) and is deducted from the amount of paid foreign tax. It should be remembered that the deduction cannot exceed the amount of tax calculated in Russia. Accordingly, if the amount of tax in the state-source of income was paid in a smaller amount than it was calculated in Russia, then the missing part will have to be paid in addition in the Russian Federation, ”explains Yekaterina Shabalina.

If you receive rental income, you must independently declare it in Russia by submitting a 3-NDFL declaration (sheet "B", or income from sources outside the Russian Federation) to the tax authority at your place of residence.

The tax return is accompanied by:

• issued foreign tax documents confirming the amount of income received and tax paid from it, as well as their notarized translation into Russian. These documents must reflect the type of income, its amount, the calendar year in which the income was received, the amount of tax and the date of its payment.
• or a copy of a tax return filed abroad with a copy of the payment document confirming the payment of tax (all this must also be translated into Russian and notarized).

“The amount of tax paid abroad is credited only after the submission of this declaration, at the end of the tax period. It is possible to declare income and receive a tax credit within three years after the end of the reporting year in which the income was received, ”says Ekaterina Shabalina.

For example, a Russian tax resident owns German real estate, which brings in 10,000 euros a year in rental income. The amount of income tax in Germany will amount to EUR 2,324 (the rate is 23.24% of rental income, taking into account the solidarity supplement), in Russia - EUR 1,300 (13%). Since the amount of 1,300 euros is less than 2,324, the property owner will not have to pay anything extra in the Russian Federation.

At the same time, deductions received abroad are not taken into account when calculating the taxable amount in Russia. Let's say a Russian rents out a house in France and receives 18 thousand euros a year. According to French law, he has the right to deduct 50% from the taxable amount in connection with the cost of maintaining the home. Consequently, € 9,000 is taxed on rental income. The minimum rate for non-residents is 20%. This means that a Russian pays tax a year in the amount of 1,800 euros. Since there is no such tax deduction system in Russia, you would have to pay from the full amount of 18 thousand euros at a rate of 13%, that is, 2 340 euros per year. But since there is an agreement on the avoidance of double taxation between Russia and France, a Russian needs to pay tax in France, and in Russia only to pay the difference - 540 euros.

It is also important to know that by paying tax in Russia under a simplified taxation scheme, you cannot receive a foreign tax offset, and taxation in this case will be double.

How tax is taken into account when selling foreign real estate

According to the letter of the Federal Tax Service No. ED-3-3 / 4062 @ dated November 9, 2012, the legislation of the Russian Federation does not distinguish between the sale of real estate in Russia and abroad - in both cases the same rules apply.

According to Yekaterina Shabalina, the income received from the sale of foreign real estate is not subject to taxation, and the seller is not required to file a tax return in Russia in two cases:

• for objects purchased before January 1, 2016: if a property is being sold that has been owned for more than three years;
• for objects purchased after January 1, 2016: if real estate is being sold that has been owned for more than five years (general case) or three years (if the taxpayer received the object by inheritance or as a gift from a relative or family member, under a life support contract with a dependent) ...

Tax exemption can be obtained if the property is not used for business activities. The definition of entrepreneurial activity was given by the Federal Tax Service in a letter No. ED-3-3 / 412 @ dated February 8, 2013.

If the seller does not meet the above conditions, then he needs to file a tax return in the form of 3-NDFL before April 30 of the year following the year of income, and pay tax by July 15.

As with the tax on rental income, tax on sales income can be credited in Russia as part of the elimination of double taxation. For Russian residents, the rate is 13%.

For example, in 2010 a Russian resident decided to buy an apartment in Spain for 500 thousand euros, and in 2016 he sold it for 550 thousand. Capital gains - 50 thousand euros - are subject to Spanish tax at a rate of 24%. The amount of tax in this case is 12 thousand euros. Since more than three years have passed between the purchase and sale, according to Russian law, it is not necessary to submit a declaration to the Russian Federation, it is enough to pay tax in Spain.

It is important to remember that tax evasion is a criminal offense. It is illegal to pay taxes abroad at a lower rate than in Russia and not fill out a tax return at home.

Julia Kozhevnikova, Tranio

Double taxation (DN) is a specific way of taxing assets. In this case, the payer has to pay taxes twice. This option is highly undesirable. Various international agreements have been adopted to avoid double taxation.

What is double taxation

Double taxation is the taxation of assets twice. Doubling arises due to the fact that taxes are collected by two states at the same time. This situation happens, as a rule, if the company receives income both in one and in another state. In this case, it is very difficult to determine the taxable base. To avoid LTOs, organizations are divided into residents and non-resident legal entities.

There is a Federal Law "On Taxation". According to its clauses, income acquired in other states is included in the tax base in the home country. Foreign funds are counted in the amount that is used in calculating taxes. In this case, you need to adhere to some rules. In particular, the amounts that are taken into account in taxation must not exceed the amount of the mandatory tax transferred in the Russian Federation.

Why is LTO so undesirable? In essence, it discriminates against the payer. The company has to pay double the tax. This interferes with the normal conduct of business.

When does double taxation occur?

DN occurs in the following cases:

1. The company pays taxes in two states. The way out is either following the conventions, according to which tax is levied only in one state, or following national laws.
2. The company has to pay tax in various places. The order in question is mixed.
3. Only a portion of a company's profits is taxed. In this case, double taxation also occurs: first, when calculating income tax, and then when calculating it on dividends. In the case under consideration, as a rule, different rates are used for the distributed and non-distributed income.

Methods for preventing double taxation are fixed in the regulations.

Varieties of double taxation

There are two types of double taxation:

1. Internal. Assets are taxed domestically. Tax collection is carried out at various administrative levels. This form of taxation can be vertical. In this case, the collection is carried out at the local and state level. The vertical form is relevant for Sweden. There is also a horizontal shape. In this case, tax collection is carried out at the same level. This form is relevant for the United States. In some states, only income earned there is taxed, in others - income in other states.
2. External. External double taxation arises from the difficulty of establishing either the taxpayer or the taxable base.

IMPORTANT! The external form involves taxation outside the state.

What are the reasons for double taxation?

Double taxation is observed in the following cases:

1. The company has dual residency. That is, it is recognized as a resident in two countries.
2. One and the same income is the taxable base in two states. For example, in one country, income is recognized as a taxable base due to the company's residence, and in the second, on the basis of the source of income rule.
3. Firm expenses are counted differently in different countries.
4. The source of income is in several states.

The main reason for the formation of double taxation is different regulations in different states, different regulation of the tax base. In addition, a regulation can be interpreted in several ways.

Let's look at an example. In the United States, inaccuracies in the declaration can result in fines of $ 10,000. In Switzerland, the wrong information in the declaration, if the violations are insignificant, are more loyal. Inaccuracies will not be considered violations. In this case, an international agreement is required. It is required to harmonize interpretations of regulations.

Tools for eliminating double taxation

There are two ways to eliminate MD:

1. One-sided. It involves measures from one state. This changes tax regulations in one country. The first method of unilateral elimination of DV is a tax credit. It involves offsetting taxes paid in another country against the obligations of the payer within the state. The second method is tax credit. Assumes a deduction from the amount of taxes within the state the amount of taxes paid in another country.
2. Multilateral. It involves the conclusion of international agreements and conventions. That is, the implementation of this method requires the efforts of two states. The most relevant method is distributive. At the same time, assets in one state are no longer taxed in favor of another country.

NOTE! As a rule, both of these methods are used to eliminate double taxation.

Interstate agreements

The first interstate agreement was signed between France and Belgium in 1843. Currently, there are more than 400 such agreements. However, almost all of these regulations are based on the principles of the Pareto optimum. The main criterion: the best option is one that benefits one side, but does not harm the other side. Based on this, we can say that interstate agreements should not worsen the position of the participating country. It is on the basis of the agreement that tax jurisdiction is established.

Based on various international conventions, these methods of eliminating double taxation are distinguished:

• Formation of precise concepts that are used in the framework of regulations. Interpretation of terms.
• Development of an LTO liquidation scheme, in which each country chooses a separate taxable base. The tax is levied on a specific income.
• Formation of a mechanism to liquidate LTOs in cases where both states tax all income.
• Elimination of taxation that discriminates against the payer in another country.
• Sharing up-to-date information to prevent evasion of mandatory fees or abuse of law.
• Establishing the best ways to liquidate LTOs in relation to residents' income.

States should assist each other in taxation.

Features of determining the maximum amount of payments

The maximum credit is calculated as follows:

1. Determines whether taxes that are paid in another country are offset against domestic tax.
2. The maximum amount of credit is set. In this case, the offset limit is calculated.
3. The smaller amount is found from the amount of taxes paid in another state and subject to offset, and from the maximum offset amount. If the company pays tax in an amount greater than the established maximum amount, it will not be accepted for foreign credit.

Double taxation is a big problem, but it can be solved through a number of instruments. They can be used either by a single country or by two states. The interaction of states with each other is considered more effective.

The problem of tax deduction by two states at once is a rather relevant topic, since due to various foundations of tax legislation in the countries of the world, many individuals who make a profit outside the territory of their homeland fall under a double deduction from them, they have to pay at the place of income and at the place of citizenship ...

This is a deduction of taxes from the income of individuals in several countries of the world - at the place of residence and at the place where these incomes are generated.

Tax collection takes place in accordance with two directions in which the fiscal service works:

• According to the territorial principle - in such countries, taxes are collected in a more loyal context, since they claim only income received within the country;
• According to the principle of residency - here the fee is designed to receive the maximum infusion into the budget, since the tax is withdrawn from the resident, regardless of the place of receipt of his income.

A feature of such taxation in Russia is its definition according to special divisions with the presence of some classification signs.

How to eliminate double taxation - see this video:

Main varieties

Classification by principles

Taxation depends on the scheme used and is of the following types:

• International double economic type - withdrawn from all entities at the same time, which received income from one operation, that is, their income is common. This is a proactive option to receive fees from a resident whose income was received abroad;
• International double legal type - this is the income received from the operation performed by one person; tax is deducted from such turnover by several states at once. In relation to this type, a set of special rules has been formed, according to which the jurisdiction of 2 states is divided to perform an operation, which means that it is necessary to establish relations between the states related to the income and the person who received it.

Important: such methods of avoiding double taxation are very effective for which the states and sign specialized agreements.

Level classification

The level of the operation also affects the classification feature, depending on it, the following types can be formed:

1. Internal - when the importance and level of the administrative-territorial unit, within which the income was received, matters, but at the same time it is carried out in any district.

In turn, this type is also subdivided into channels according to the operations performed:

• Vertical, according to which it is necessary to pay two types of tax - local and state;
• Horizontal - its peculiarity is in an individual approach to each operation, depending on the region of its execution, that is, it is possible to pay only taxes held in the territory of a given municipality, you can pay all taxes or national taxes related to the operation.

1. External - outside the Russian Federation, in a similar situation, the tax codes of the two states collide, the taxpayer will have to satisfy the requirements of the fiscal services in both territories.

Negative aspects of taxation leading to contradiction

Double taxation causes a lot of indignation on the part of citizens who earn money abroad. Fiscal services, in turn, despite filling the state budget, are trying to solve the problem, since citizens of their state suffer from this position in the first place.

• The division of the taxpayer's profit by two states at once in the same period, which, as a result, amounts to a considerable amount for the subject;
• Separation of residents and non-residents is extremely problematic, for this it is necessary to create a new classification of income;
• The need to create a clear legislative framework that strictly regulates the object of taxation for the possibility of collection.

Important: it is precisely such interaction that will help to resolve the issue and find a compromise of interests of the two states.

Agreement on the avoidance of double taxation

This is a pact between the two states, which clearly specifies the rules for deducting taxes in cases where the object of profit is located in the territory of a country where the entity is not registered as a resident.

The need for it is the formation of a list of taxes that fall under the agreement, as well as a list of entities that are subjects of double tax deduction.

Also, such an agreement contains all the essential conditions - validity period, taxation conditions, the procedure for terminating cooperation.

Important: Russia has 82 agreements on avoidance of double tax deduction with other states.

The advantages of such agreements are clear:

• This is to prevent double or burdensome tax deductions;
• An effective tool providing for the application of only positive codes of tax laws of the two countries;
• Opportunities for tax innovations, taking into account national tax laws;
• Minimization of rates;
• Fixing the residence and location of the income object.

In this case, it should be understood what an indulgence is:

• Will not allow you to avoid making mandatory payments;
• It has several directions and options for collecting contributions, and with the wrong approach, you can not reduce, but rather increase them;
• To use the agreement profitably, it is necessary to take into account all the nuances of the country where the business is supposed to be located and the presence of an agreement of the native state signed with it.

Application of the agreement on the creation of special economic zones:

• Income and capital taxes;
• Individuals and legal entities, residents and non-residents.

The certificate should be accompanied by:

• A certificate of payment of the fee abroad, while it must be translated into the state language and certified by a notary;
• A document showing the type of income and its amount for the calendar year, it should also indicate the date of collection and its amount.

Tax declaration and receipt are also certified. Important: the use of a simplified taxation system provides for double tax payment, since it is impossible to get a credit from another country.

Taxation when selling foreign property

Prior to January 1, 2016, Russian legislation provided for the payment of tax on the sale of property abroad and within the country in the same amount, no exceptions were provided.

• The owner has had the property for over 5 years;
• Received it according to a deed of gift or looked after an incapacitated family member who was the owner of the property, in such cases the property should have been owned for at least 3 years.
• At the same time, housing was not related to entrepreneurial activity.

Registration of profits from the sale of property

Profit registration in this case occurs in the following stages:

• You should figure out whether the former owner is related to the categories that are exempt from paying the fee;
• If not, you must draw up and submit a declaration by April 30 of the year following the receipt of income. You can read how to fill out the tax return of a taxpayer in general order;
• Pay the fee by July 15 of the same year.

Important: in this case, the application of a double payment of tax is also possible if the tax was calculated at the rate of 13% of the profit received.

Calculation of tax on the activities of an entrepreneur

According to the existing rules, if income is received in the territory of any country, the tax fee should be paid only to its treasury, but taking into account the following points:

• Profit derived from permanent establishment;
• The person who received it is not a resident of another country.

Moreover, if the income is received through the representative office, then the tax is withdrawn exactly from the part that is received by the representative office.

In this case, it is necessary to understand and comply with the terms of representation:

• Representation can only be carried out through a permanent location, which is permanent, it cannot be a portable tent;
• A representative office can be in the form of an integral project if it is envisaged to carry out works requiring relocation, for example, construction;
• Representation cannot be represented by an agent with the residence of the country;

Important: in this case, commerce should be carried out in full or in part through the specified location.

• If the premises are intended for the performance of auxiliary or temporary activities, then it cannot be considered a place of representation, in which case there can be no question of a tax contribution to the treasury of one state.

Important: if the management of auxiliary premises is carried out from the main office, then the foreign country where they are located does not have the right to levy taxes from the organization.

Conclusion

When receiving income from any activity abroad, you should take into account all the peculiarities of the tax laws of a given country, but remember that tax payments are mandatory in any case, and evading this procedure is a criminal offense. Paying tax abroad at a lower rate than at home and not submitting reports for this is unacceptable.

In what order the Convention for the avoidance of double taxation is applied, you can see here: