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Information for clients with income sourced within Russian Federation.
Dear Clients,
We would like to your bring your attention to rules on withholding tax on income sourced within Russian Federation applicable from 2017.
According to the current tax law, tax agents, who include Russian depositories and brokers, are responsible for calculation and withholding of tax on dividend payments and other forms of income on securities and other financial instruments (including derivative instruments) traded in the Russian Federation and/or issued by Russian issuers.
Unless otherwise agreed by international tax treaties, following tax rates are applicable[i]:
|
Tax residency |
Dividends |
Interest income on bonds (including accrued interest) |
Derivative instruments |
|||
|
Natural person |
Legal entity |
Natural person |
Legal entity |
Natural person |
Legal entity |
|
|
Income beneficiary was not disclosed |
15% |
20% / 30% |
20% |
|||
|
Not confirmed or no international tax treaty[ii] |
15% |
15% |
30% |
20% |
30% |
20% |
|
Russia |
13% |
13% |
13% |
0% |
13% |
0% |
|
Estonia |
15% |
15% |
30% |
20% |
30% |
20% |
|
Latvia |
10% |
10% |
5% / 10% |
5% / 10% |
0% |
0% |
|
Lithuania |
10% |
10% |
10% |
10% |
0% |
0% |
|
Cyprus |
10% |
10% |
0% |
0% |
0% |
0% |
|
Ukraine |
15% |
15% |
10% |
10% |
30% |
20% |
In order to use the tax benefits under the Russian tax law and the double-tax treaties between the Russian Federation and the country of your tax residency, you are required to submit a list of documents in accordance with Appendix 3 of Terms and Conditions for Rendering of Investment Services.
If you are acting on behalf of a third party, the required documents must be submitted for the final beneficiary.
Documents must be submitted electronically by 07.04.2017 via email address clients@kfe.ee or Personal Account with subsequent submission of original documents.
Please note that under the Russian tax law the tax agent will apply the maximum tax rate if the required documents are not submitted.
If you have any queries please do not hesitate to contact our client services department by sending an email to clients@kfe.ee
Thank you for your cooperation.
Sincerely yours,
AS KIT Finance Europe
__________________
[i] The tax rates indicated in this notice are valid as at 31.03.2017. With the current rates and their application is necessary to familiarize themselves in the Tax Code of the Russian Federation and in the relevant agreements on avoidance of double taxation.
[ii] List of countries with double-tax treaties with Russian Federation is available here (https://www.nalog.ru/eng/international_cooperation/dta )
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