Deduction of input VAT when providing services to foreigners from July 1, 2021

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Published: 07/28/2017

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When a Russian company enters international markets, it inevitably faces the question: is it necessary to pay VAT when providing services in foreign markets in favor of a foreign organization? To answer this, you should refer to the current tax legislation and established judicial practice.

• VAT when providing services to a foreign counterparty
• Rules and features
• Examples We pay VAT
• No payment required

Sales of works and services by foreign companies

The two main taxes levied on organizations are value added tax (VAT) and income tax. But in this article we will focus on the first and look at how it is calculated, by whom and when it is paid.

The management of a foreign organization that has decided to enter the fight for the Russian consumer must understand the specifics of our market and tax legislation. You can start small and find out, for example, whether foreign companies pay VAT if they sell their services in Russia. And although the concept of VAT is familiar to almost any average person (and even more so to a top manager), the procedure for working with this tax has its own characteristics in each country.

The Russian Federation is no exception in this sense: the activities of foreign companies are subject to taxation (including the already mentioned VAT). But our legislation cannot be called simple and unambiguous, because sometimes only lawyers can understand its intricacies. That is why, before expanding your presence area, you need to clarify how VAT is paid when selling services in the Russian Federation.

There are only two possible answers to this question: in the first case, the company contributes to the budget on its own; in the second, the intermediary, the tax agent, does the same thing. It all depends on whether the foreign organization is registered with the Russian tax authority - the Federal Tax Service (hereinafter referred to as the FTS).

In Russian legislation there are such concepts as resident and non-resident.

A resident is an individual or legal entity registered and registered with the tax authorities on the territory of the Russian Federation, and non-residents, as you might guess, include all those who do not have registration (including with the Federal Tax Service) in Russia.

We recommend that you read more detailed information about.

If a foreign company is registered with the Federal Tax Service, then interaction with the tax department will fall entirely on its shoulders. Otherwise - if there is no registration with the tax authorities - sooner or later the client will have to think about what to do with VAT when purchasing services from a foreign company.

After all, the Tax Code of the Russian Federation (hereinafter referred to as the Tax Code of the Russian Federation) leaves no choice: the tax must be paid in any case. And this is exactly the situation when the buyer will act as a tax agent who settles all issues with transfers to the budget.

How to determine the place of sale of services?

General rule for determining the place of sale of services (works)

The general rule for determining the place of sale is at the place of activity of the performer, i.e. the seller of services (works).

The place of activity in the Russian Federation or not in the Russian Federation is determined by the place of registration of the organization (entrepreneur):

If there is no state registration, then the place of activity is determined:

• based on the place specified in the constituent documents;
• places of management of the organization;
• location of the permanent executive body of the organization;
• place of residence of an individual entrepreneur.

For branches and representative offices of an organization, the place of activity is determined:

• location of the permanent representative office in the Russian Federation.

When purchasing services (works) from a foreign partner who has a permanent establishment in the Russian Federation, the Russian buyer no longer acts as a tax agent for VAT. The foreigner bears the tax burden himself (Article 306 of the Tax Code of the Russian Federation).

The above norms are established in paragraph 2 of Art. 148 Tax Code of the Russian Federation.

What is meant by registration in the Russian Federation?

Registration in the Russian Federation is the state registration of an organization (entrepreneur) with the Federal Tax Service of the Russian Federation with an entry in the Unified State Register of Legal Entities (USRLE) and the Unified State Register of Individual Entrepreneurs (USRIP).

At the same time, tax registration is carried out and an entry is made in the Unified State Register of Taxpayers (USRN), and a Taxpayer Identification Number (TIN) and Registration Code (KPP) are assigned.

You can check information about state registration on the portal of the Federal Tax Service of the Russian Federation

When does the general rule not apply - the place of sale of services is determined by the place of activity of the contractor?

There are a number of exceptions to the general rule “the place of sale is determined by the seller’s place of business.”

To correctly determine the place of sale, you need to check whether the purchased or provided services (work) are named in the list of exceptions. If services and works are not listed in any of the blocks with exceptions, then the general rule applies - the place of sale is determined by the seller’s place of business .

Determining the place of sale of services and work should always begin with exceptions and then move on to the general rule.

To determine the place of implementation of services, work, you need to go through each block presented below and find your subject of the agreement (contract).

Blocks begin with exceptions and end with a general rule.

The table also provides information for cases of purchasing services (work) from partners from non-CIS countries and from the EAEU.

This scheme is universal and can be used mirrored to determine:

• are we a tax agent for VAT when purchasing services (work) from a foreign seller;
• Should our organization calculate VAT when it itself provides services (work) for a foreign buyer?

The logic for working with the circuit is simple - you should define:

• your status under the contract – buyer / seller;
• place of sale of services (works) - Russian Federation / not Russian Federation;
• procedure for calculating VAT - VAT is calculated / VAT is not calculated.

These tables present a general scheme for calculating VAT for the “import” and “export” of services and work from a foreigner.

Using the flowchart given below, let’s move on to specifics and determine the place of sale of the purchased (sold) services and works from a foreigner.

If services are provided to a non-resident

The main purpose of this article is to highlight how taxes are paid by a foreign organization that provides services in our country. Nevertheless, we will pay a little attention to the reverse situation, when a service is provided by a Russian legal entity to a foreign one, and we will find out how VAT will be paid by the Russian company in this case.

Everything is quite simple: if the service was sold on the territory of the Russian Federation, then VAT is also subject to payment in the prescribed manner. If this happened outside Russian borders, there is no taxation. Now let's move on to the logical question: what is the place of sale of services and how is it determined.

In Russia, such a form of business organization as (hereinafter referred to as individual entrepreneur) is quite common, which is usually classified as a so-called small business. The activities of individual entrepreneurs can be related to both the sale of goods and the provision of services class=”aligncenter” width=”663″ height=”403″[/img]

Ambitious IP owners, as a rule, strive for constant development not only within Russian borders, but also beyond them. This explains their interest in whether an individual entrepreneur can provide services to foreign companies. And it must be said that in this case there are no prohibitions or legislative obstacles: individual entrepreneurs, just like legal entities, can enter into contracts, provide services, and conduct settlements with foreign companies. The taxation procedure will also not change. The only point that needs to be taken into account concerns currency control: in the case of individual entrepreneurs, it is more thorough.

Place of service provision

For the correct calculation of taxes, the place of provision of services is of great importance. The general rule can be formulated something like this: taxes must be transferred to the budget of the country in whose territory the services were provided. For tax purposes, it is customary to distinguish several characteristics that determine the place of sale of services.

Location of property

This sign assumes that the services were related to any property. The territory of the country where this property was located at the time of provision of services will be considered the place of their provision. Accordingly, taxes will be calculated in accordance with the legislation of the specified state.

Place of actual provision of services

This criterion is typical for services related to certain areas and objects of everyday life. As a rule, these include those services that are provided in stationary public institutions and organizations.

Buyer's place of business

The place of sale of services can be recognized as the territory of the country where the buyer carries out its activities. It is important that this activity must be registered in accordance with the laws of the state.

Supporting documents

The place of provision of services is confirmed by the following documents:

• Contract;
• documents confirming the provision of services (for example, acceptance certificates, receipts, etc.).
• when providing services in electronic form to individuals (not individual entrepreneurs) - registers of transactions indicating the cost of services.

Russian Federation: features of recognition of the place of provision of services

This article is devoted to the requirements of Russian tax legislation; accordingly, we are considering what kind of taxation services that are provided on the territory of the Russian Federation are subject to. How can we determine that work or services were implemented within the borders of our state? This issue is regulated by Art. 148 of the Tax Code of the Russian Federation.

Exceptions

Special conditions apply for services related to transportation and transportation. They can be provided by both Russian companies and individual entrepreneurs, as well as foreign organizations that are not registered with the Federal Tax Service.

The Russian Federation will be recognized as the place of sale of such services in the following cases:

• if vehicles for transportation (aircraft, sea vessels, inland navigation vessels) are provided by Russian companies or individual entrepreneurs, and the point of departure and/or destination is located on the territory of Russia;
• transportation of goods under the customs transit procedure is carried out by organizations or individual entrepreneurs whose place of business is Russia;
• transportation by pipeline transport is provided by Russian organizations;
• air transportation is carried out by Russian airlines.

Regulatory documents governing the determination of the place of sale of services

To determine the place of sale of services (works) purchased from foreign organizations, you should use different regulatory documents. Therefore, first of all, it is necessary to establish where the foreign seller is from.

When working with counterparties from non-CIS countries, taxpayers work according to the norms of the Tax Code of the Russian Federation.

The Tax Code of the Russian Federation does not apply to partners from the EAEU and has no legal force, therefore the requirements of the Treaty on the EAEU dated May 29, 2014 should be taken into account. At the same time, if the Treaty on the EAEU makes a reference to the local legislation of the EAEU member country, then we use it, incl. Tax Code of the Russian Federation.

The wording of Art. 148 of the Tax Code of the Russian Federation and the Treaty on the EAEU dated May 29, 2014 are almost identical, but there are still differences. Therefore, our article provides a comparative analysis of all main types of services and work under the Tax Code of the Russian Federation and the Treaty on the EAEU.

The organization entered into a contract with the Spanish company Transporten for the provision of transportation, transportation and related services in the Russian Federation.

The place of sale of services is the Russian Federation.

Since the supplier is a foreign organization that is not registered with the tax authorities, the point of departure and destination are located on the territory of the Russian Federation (clause 4.1, clause 1, article 148 of the Tax Code of the Russian Federation).

The organization entered into a contract with the Kazakh company Tasymal for the provision of transportation, transportation and related services in the Russian Federation.

The place of sale of services is not the Russian Federation (clause 5, clause 29 of the EAEU Protocol).

Because there is no norm similar to the Tax Code of the Russian Federation (clause 4.1, clause 1, Article 148 of the Tax Code of the Russian Federation) .

Read also:  What percentage of the salary is the advance and how to calculate it

Tax agents for VAT payment

A tax agent is an intermediary who calculates, withholds from the taxpayer and transfers the amount of VAT to the budget. A taxpayer is an organization whose activities are subject to taxes under the laws of the Russian Federation.

In our case, the taxpayer is a foreign company that provides paid services, but is not registered with the tax authorities of the Russian Federation.

It is precisely because of the lack of registration with the Federal Tax Service that the payment of VAT for a foreign legal entity is carried out by a tax agent.

The duties of a tax agent include:

• timely and ;
• ;
• tax control (calculation, withholding, transfer to the budget);
• written notification to the tax inspectorate about the impossibility of withholding tax and the amount of debt of the taxpayer. The notification is sent to the inspectorate at the place of registration of the tax agent, the notification period is 1 month from the moment the agent learned about the formation of the debt;
• provision of supporting documentation;
• storage of documents on the basis of which taxes were calculated for 4 years;

For failure to perform its functions, a tax agent may be held liable:

1. In accordance with Art.
   123 Tax Code of the Russian Federation. Occurs if the agent did not withhold/remit or did not withhold/remit the tax in full. The preventive measure is a fine of 20% of the amount that must be withheld/transferred.
2. In accordance with Art. 199.1 of the Criminal Code of the Russian Federation.

Occurs if the failure to fulfill the duties of a tax agent was committed for personal interests. Information on how the amount of unfulfilled obligations for the calculation, withholding and transfer of taxes is classified, and on the penalties for failure to fulfill obligations is presented in the tables below.

Preventive measures depend on the amount of unfulfilled obligations.

Now let's look at who can conduct VAT calculations as a tax agent when paying for services to a foreign company. Calculations mean the whole range of activities: .

Acceptance of VAT for deduction by a tax agent

The procedure for accepting VAT for deduction

VAT paid by a tax agent to the budget when purchasing services (work) from a foreigner can be deducted by the VAT payer (clause 3 of Article 171 of the Tax Code of the Russian Federation).

VAT paid to the budget by a VAT evader cannot be deducted.

Taxpayers using the simplified tax system (income minus expenses) have the right to include in expenses the amount of VAT paid by them as tax on VAT (clause 8, clause 1, article 346.16 of the Tax Code of the Russian Federation).

Agency VAT is taken into account in expenses in the same way as the services (work) to which the tax relates. If services (work) are named in clause 1 of Art. 346.16 of the Tax Code of the Russian Federation, then VAT on them can be taken into account in expenses under the same item. And if they are not named, then VAT cannot be taken into account in expenses.

The right to deduct VAT arises when the following conditions are simultaneously met:

• services (works) purchased for activities subject to VAT;
• the correct SF issued by the NA itself is available;
• services (work) are accepted for accounting;
• VAT is paid by the tax agent to the budget.

VAT must be paid by the tax agent to the budget, and not offset (Letter of the Ministry of Finance of the Russian Federation dated August 12, 2010 N 03-07-11/355).

The regulatory authorities insist on this position; judicial practice is contradictory - the courts side with both the Federal Tax Service and taxpayers. Therefore, in this case, you should not take risks and offset VAT.

Tax agents have the right to deduct VAT in the tax period when the tax was actually paid (Letter of the Ministry of Finance of the Russian Federation dated October 23, 2013 N 03-07-11/44418; Resolution of the Federal Antimonopoly Service of the North-Western District dated January 28, 2013 N A56-71652/ 2011; dated 03/21/2012 N A56-38166/2011).

The VAT return regarding the transactions of the tax agent will be completed as follows:

In Section 3, page 180 “The amount of tax paid to the budget by the taxpayer as a buyer - tax agent, subject to deduction”:

• the amount of VAT to be deducted.

In Section 8 “Information from the purchase book”:

• invoice issued by a tax agent. Operation type code "".

VAT deduction by tax agent on advance payments

Can a tax agent claim a deduction for advance payments?

The Ministry of Finance of the Russian Federation believes that the RA does not have the right to claim a VAT deduction on advance payments. He can use it only after registering goods (services, works). Norms of paragraph 12 of Art. 171 of the Tax Code of the Russian Federation and clause 9 of Art. 172 of the Tax Code of the Russian Federation do not apply to tax agents.

Reason - there is no invoice issued by the seller, necessary for applying the VAT deduction (clause 1 of Article 172 of the Tax Code of the Russian Federation), which means that the standard procedure for applying deductions is not observed (Letter of the Ministry of Finance of the Russian Federation dated 04/06/2016 N 03-07-08/ 19500; Letter of the Ministry of Finance of the Russian Federation dated June 21, 2013 N 03-07-08/23545; Decision of the Supreme Arbitration Court of the Russian Federation dated September 12, 2013 N 10992/13).

Transfer of VAT deduction by tax agent

Can the tax agent defer the VAT deduction to a later period?

The tax agent cannot exercise the right to apply a VAT deduction for 3 years, which is provided for in clause 1.1 of Art. 172 of the Tax Code of the Russian Federation.

VAT deduction is applied only in the period when the conditions for applying the deduction are met (Letter of the Ministry of Finance of the Russian Federation dated November 17, 2016 N 03-07-08/67622).

VAT allocated in documents by suppliers from the EAEU

VAT is highlighted in the documents of the supplier from the EAEU, is it possible to apply a deduction?

VAT allocated in documents by suppliers from the EAEU when performing services (works) cannot be deducted.

VAT in this case is calculated and paid by the supplier from the EAEU to the budget of his state, and not to the budget of the Russian Federation. The budgets are different and the EAEU countries do not compensate each other for taxes. The supplier also issued an invoice in accordance with its legislation and its VAT rate. Such a document cannot be registered in the purchase book and be the basis for deducting VAT, because does not comply with the requirements of either the Tax Code of the Russian Federation or the Decree of the Government of the Russian Federation of December 26, 2011 N 1137.

On April 03, the Organization entered into a contract with the Belarusian company Belmashstroy to carry out work on the repair of movable property in the amount of EUR 5,900, including VAT.

The property of the Russian organization at the time of repair is located on the territory of Belarus.

The Russian Federation is not the place of implementation of work (clause 2, clause 29 of the EAEU Protocol), therefore, the Organization does not act as a tax agent for VAT.

On April 15, the counterparty Belmashstroy completed the work, issued a report and invoice to our Organization. The invoice highlights “Belarusian” VAT at a rate of 20%.

The amount of VAT that the Belarusian supplier allocated in his invoice is included in the cost of work and is not subject to deduction in the Russian Federation (Letter of the Ministry of Finance of the Russian Federation dated May 18, 2015 N 03-07-08/28428; Letter of the Ministry of Finance of the Russian Federation dated July 1, 2014 N 03-07 -08/31595; Letter of the Federal Tax Service of the Russian Federation dated 09/03/2013 N ED-4-3/ [email protected] ).

Should the NA exhibit SF if it purchases services (works) exempt from VAT, named in Article 149 of the Tax Code of the Russian Federation?

The Ministry of Finance of the Russian Federation believes that when carrying out transactions for the sale of goods (work, services) that are not subject to taxation (exempt from taxation), the tax agent has the right not to issue an invoice (Letter of the Ministry of Finance of the Russian Federation dated March 19, 2014 N 03-07-09/ 11822).

Conditions for recognition as a tax agent

The basic requirements are described in Art. 161 part 2 of the Tax Code of the Russian Federation. We will focus on those that apply to tax agents of foreign companies selling services in the Russian Federation.

So, to be recognized as a tax agent, the following conditions must be simultaneously met:

• organization or (hereinafter referred to as individual entrepreneur);
• registration with the Federal Tax Service;
• purchase of services from these foreign companies on the territory of the Russian Federation.

Slightly different rules apply if a foreign company provides services in electronic form, that is, through information and telecommunication networks (including via the Internet), a full list of which is given in Art. 174.2 part 1 of the Tax Code of the Russian Federation.

The conditions for recognition as a tax agent depend on who acts as the buyer of such services and whether intermediaries are involved in the transaction.

VAT on the purchase of consulting services from foreigners from January 1, 2021

Let's consider an example of how VAT accounting operations are reflected in the 1C: Accounting 8 program, edition 3.0, in the event that a Russian company purchases other (consulting) services from a foreign organization registered with the tax authorities of the Russian Federation from 01/01/2019.

Example 2

The sequence of operations is given in Table 2.

table 2

Setting up functionality

A taxpayer purchasing services, the place of sale of which is recognized as the territory of the Russian Federation, from foreign entities registered with the tax authorities of the Russian Federation in accordance with paragraph 4.6 of Article 83 of the Tax Code of the Russian Federation, must check the correctness of the information about the foreign entity from whom the purchase is being made. such services.

Particular attention should be paid to filling out the fields indicating the country of registration of such a foreign entity, as well as its TIN and KPP assigned by the tax authority of the Russian Federation in connection with registration in accordance with paragraph 4.6 of Article 83 of the Tax Code of the Russian Federation (see Fig. 2).

According to the letter of the Ministry of Finance of Russia dated March 15, 2019 No. 03-07-08/17231, a foreign organization that provides a Russian organization not only with services in electronic form specified in paragraph 1 of Article 174.2 of the Tax Code of the Russian Federation, but also other services (for example, consulting), place implementation of which, on the basis of subparagraph 4 of paragraph 1 of Article 148 of the Tax Code of the Russian Federation, the territory of the Russian Federation is recognized, independently fulfills the obligation to calculate and pay VAT to the budget.

Since a Russian organization purchases services (for example, consulting) on ​​the territory of the Russian Federation from a foreign organization registered with the tax authority in accordance with paragraph 4.6 of Article 83 of the Tax Code of the Russian Federation, and at the same time does not fulfill the duties of a tax agent for VAT, it is necessary to check for this agreement no flag for values ​​The Organization purchases electronic services from a foreign counterparty and the Organization acts as a tax agent for the payment of VAT.

Transfer of advance payment

The transfer of funds to a foreign organization providing consulting services (operations 2.1 “Registration of advance payment”, 2.2 “Revaluation of currency balances on the account”) in the program is registered by the document Write-off from the current account (section Bank and cash desk - subsection Bank - document journal Bank statements), which can be created manually or generated based on downloading from other external programs (for example, “Client-Bank”).

As a result of posting the document Write-off from the current account, the following entries are made in the accounting register:

Debit 91.02 Credit 52 - for the amount of revaluation of currency balances on the account; Debit 60.22 Credit 52 - for the amount of the transferred advance payment in the amount of 240.00 EUR, which in terms of rubles is 17,519.88 rubles. (240.00 EUR x 72.9995, where 72.9995 is the exchange rate of the Central Bank of the Russian Federation on the date of advance payment (03/20/2019)).

Reflection of the service provided

To perform operations 3.1 “Accounting for consulting services provided”, 3.3 “Accounting for advance payment”, you need to create a document Receipt (act, invoice) with the document type Services (act) (section Purchases - subsection Purchases).

As a result of posting the document Receipt (act, invoice) the following accounting entries will be entered into the accounting register:

Debit 60.21 Credit 60.22 - for the amount of the credited advance payment in the amount of 17,519.88 rubles; Debit 19.04 Credit 60.21 - for the amount of VAT amounting to RUB 2,903.60. (40.00 EUR x 72.5900, where 72.5900 is the exchange rate of the Central Bank of the Russian Federation on the date of provision of the consulting service (03/25/2019) in accordance with paragraph 4 of paragraph 1 of Article 172 of the Tax Code of the Russian Federation); Debit 26 Credit 60.21 - for the cost of the consulting service provided, which for accounting and tax accounting purposes is RUB 14,616.28. ((240.00 EUR x 72.9995) – 2,903.60 rubles, where 72.9995 is the exchange rate of the Central Bank of the Russian Federation on the date of prepayment (03/20/2019)).

An entry with the type of movement Receipt and the event Submitted by VAT by the supplier is made in the VAT presented register.

Deductions of VAT amounts presented by foreign organizations registered with the tax authority in accordance with paragraph 4.6 of Article 83 of the Tax Code of the Russian Federation for consulting services, the place of sale of which is recognized as the territory of the Russian Federation in accordance with subparagraph 4 of paragraph 1 of Article 148 of the Tax Code of the Russian Federation, are made in accordance with the generally established procedure in accordance with paragraphs 1 and 2 of Article 171 of the Tax Code of the Russian Federation and paragraph 1 of Article 172 of the Tax Code of the Russian Federation, i.e. on the basis of invoices issued by such foreign organizations.

To register a received invoice (operation 3.4 “Registration of a received invoice”), you must enter the number and date of the incoming invoice in the fields Invoice No. and from the document Receipt (act, invoice), respectively, and click the Register button.

In this case, the document Invoice received will be automatically created, and a hyperlink to the created invoice will appear in the form of the basis document.

The fields of the Invoice document received (Fig. 7) will be filled in automatically based on information from the Receipt document (act, invoice).

Rice. 7. Invoice received from a foreigner for consulting services

Besides:

• in the line Base documents there will be a hyperlink to the corresponding receipt document;
• in the Received field, the date of registration of the Receipt document (act, invoice) is entered, which, if necessary, should be replaced with the date of actual receipt of the invoice;
• in the Transaction Type Code field the value 01 will be reflected, which corresponds to the acquisition of goods, works, services (Appendix to the order of the Federal Tax Service of Russia dated March 14, 2016 No. ММВ-7-3/ [email protected] ).

If you need to change the specified data, for example, clarify the date of receipt, the document must be posted again by clicking the Write button or by executing the Post command from the list of available commands, opened by clicking the More button.

As a result of posting the Invoice document received, an entry will be made in the information register of the Invoice Log. Register entries The Invoice Register are used to store the necessary information about the received invoice.

Determination of the tax base for VAT

In general terms, the tax base refers to the income that is subject to taxation. But the procedure for determining the tax base depends on who calculates it: the taxpayer directly or the tax agent.

Taxpayer

The tax base is the total cost of services provided excluding tax. In other words, this is the amount of money received by the service provider, from which tax will be calculated and paid in the future.

If the foreign service provider received advance payments (full or partial payment), the tax base will be determined by their amount, including tax. However, prepayment does not increase the tax base in the following cases:

• the duration of the production cycle is more than 6 months (only when the tax base is determined as such services are provided);
• taxation is carried out at a zero rate;
• This type of service is not taxed.

Tax agent

If a foreign service provider organization is not registered with the Federal Tax Service, the VAT tax base is calculated by the tax agent. In this case, it will be determined by the amount of income from services sold, taking into account tax, while the formation of the tax base is carried out separately for each operation.

Moment of determining the tax base

It is impossible not to mention such a concept as the moment of determining the tax base. In general, it is the earlier of two dates:

• day of service provision;
• the day of advance payment (full or partial) for the subsequent provision of services.

However, in some cases different rules apply:

Failure to fulfill the duties of a tax agent - fines and penalties

If the NA does not fulfill its obligations to withhold (transfer) taxes, then on the basis of Art. 123 of the Tax Code of the Russian Federation, a fine of 20% of the amount subject to withholding and (or) transfer is collected from him (Resolution of the Presidium of the Supreme Arbitration Court of the Russian Federation dated April 3, 2012 N 15483/11 in case No. A72-5929/2010; Resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation dated July 30. 2013 N 57).

In case of delay in payment of VAT, the tax agent is obliged to calculate and pay penalties (Article 75 of the Tax Code of the Russian Federation).

From October 2021, penalties are calculated according to new rules using a scale (clause 4 of article 75 of the Tax Code of the Russian Federation). If payment is late:

• up to 30 days inclusive - 1/300 of the refinancing rate of the Central Bank of the Russian Federation, valid for a period of up to 30 calendar days;
• 31 or more days - 1/150 of the rate in effect from the 31st calendar day of delay.

Calculate penalties using the Penalty Calculator.

Calculation and payment of VAT

, like accounting, must be formed for a certain period (it is usually called reporting, and when it comes to taxes - tax) and provided within the established time frame. For VAT, there is a quarterly tax period. This means that every three months taxpayers must make all payments to the budget for VAT.

The calculation is carried out at the end of each tax period, and the calculation takes into account those transactions for which the moment of determining the tax base occurred in the reporting quarter.

The amount to be transferred to the budget is calculated by multiplying the tax base by the tax percentage rate; the base rate is 18%.

But if a foreign company sells services electronically, its activities will be subject to VAT at a rate of 15.25%.

If the organization maintains separate accounting, then the total tax will be equal to the amount of taxes calculated for each object or operation. This calculation procedure applies:

• tax agents of foreign organizations not registered with the Federal Tax Service of the Russian Federation;
• in the case of sales of services taxed at a zero rate.

The tax is paid in equal installments monthly (within 3 months following the reporting period) no later than the 25th of:

• foreign organizations registered with the Federal Tax Service - at the place of registration.
• if settlements with the budget are carried out through a tax agent - at the agent’s location.

How to calculate VAT under the simplified tax system?

A rate of 10% applies to a limited list of products, in accordance with clause 2 of Art. 164 Tax Code of the Russian Federation. The tax amount for excisable products subject to customs duties is calculated using the formula:

VAT = (St + Ps) x N

Here, “St” refers to the customs value, “P” is the amount of customs duty, “N” is the tax rate.

Calculation formula for imported products exempt from duty and excise tax:

VAT = St x N

For clarity, let's give an example. Baby strollers worth 100 thousand rubles were imported. According to the Tax Code, the sale of this category of goods is carried out at a VAT rate of 10%. The tax amount will be calculated as follows:

100 thousand rubles. x 10% = 10 thousand rubles. VAT amount

Thus, the consumer, including VAT, will be presented with an amount of 110 thousand rubles, and the importer will pay 10 thousand to the budget.

For imported goods not specified in paragraph 2 of Art. 164 of the Tax Code of the Russian Federation, a rate of 20% is used. Let us present the calculation for clarity. The store purchased 10 tablets from a Chinese supplier. The total purchase price in rubles is 200 thousand rubles. This amount includes the cost of equipment and duties. The VAT rate will be as follows:

200 thousand rubles. x 20% = 40 thousand rubles.

This means that the company will transfer 40 thousand rubles to the budget.

The taxable base is calculated for each product category that differs in name, brand, type, even if these goods are imported in one batch. This procedure is determined by Order of the State Customs Committee of the Russian Federation No. 131 of 02/07/2001.

Preparation of invoice

An invoice is a document on the basis of which the buyer accepts for deduction the tax amounts presented by the seller of services.

The document is issued by the seller when selling services and contains the following data:

• number and date of registration;
• information about the taxpayer seller and buyer (name, address, identification numbers);
• payment document number (if payment methods for services such as full or partial advance payment were used);
• description of services and units of measurement (if applicable);
• volume of services provided;
• currency;
• price per unit (if applicable) excluding tax;
• the cost of the entire volume of services without tax;
• tax rate;
• tax amount;
• the cost of the entire volume of services including tax.

Reimbursement of import VAT

According to Art. 172 of the Tax Code of the Russian Federation, VAT on the import of goods can be deducted. The following conditions are required for this:

• Imported goods are purchased for mandatory participation in transactions subject to VAT.
• The arrival of goods is reflected in accounting.
• The importer has documentary evidence of the actual payment of VAT.

However, individual entrepreneurs and enterprises using the simplified tax system, as well as those exempt from taxation, are deprived of the opportunity to recover import VAT. Such importers include the tax amount in the cost of purchased goods/services.

In addition, instead of deducting VAT on imports, you can offset it by submitting an application to the Federal Tax Service.

When a Russian organization is exempt from paying VAT

Article 149 of the Tax Code of the Russian Federation provides a list of transactions that are not subject to taxation, and it is its provisions that make it possible for a foreign company to provide services without VAT.

So, according to tax legislation, VAT is not paid when providing services:

• medical (except for veterinary, cosmetology and sanitary-epidemiological);
• for supervision and care of children in preschool organizations, sections, clubs, etc.;
• care for the sick, elderly and disabled;
• on acquisition, preservation and use of archives;
• for the transportation of passengers;
• ritual;
• on provision of residential premises for use;
• depository;
• repair and maintenance of goods and household appliances;
• on the preservation of cultural heritage sites;
• for film production;
• provided at airports;
• for servicing sea vessels;
• pharmaceutical organizations for the manufacture of drugs;
• on organizing and conducting gambling;

Changes in Chapter 21 of the Tax Code of the Russian Federation from 07/01/2019

Normative base

• Federal Law of April 15, 2019 N 63-FZ;
• Chapter 21 of the Tax Code of the Russian Federation (VAT).

Applies to transactions from 07/01/2019
for both purchases and sales
(Letter of the Ministry of Finance of the Russian Federation dated 09/03/2019 N 03-07-08/67703).

Change No. 1. Input VAT

Place of sale not in the Russian Federation

. For example, pp. 4 paragraphs 1 art. 148 of the Tax Code of the Russian Federation (“for the buyer”) – provision of consulting, legal, accounting, auditing, engineering, advertising, marketing services, information processing services...

Operations under Art. 149 Tax Code of the Russian Federation

. For example, pp. 26 Art. 149 of the Tax Code of the Russian Federation - transfer of exclusive rights to electronic computer programs, databases..., as well as rights to use the specified results of intellectual activity on the basis of a license agreement.

Change No. 2. Proportion for separate VAT accounting

If the place of sale of services (works) is not the Russian Federation according to Art. 148 of the Tax Code of the Russian Federation (clause 4 of Article 170 of the Tax Code of the Russian Federation, clause 4.1 of Article 170 of the Tax Code of the Russian Federation), with the exception of operations under Art. 149 of the Tax Code of the Russian Federation, then such sales for separate accounting purposes are subject to VAT (paragraph 9, clause 4, article 170 of the Tax Code of the Russian Federation).

Regulatory uncertainty

According to the EAEU

the place of sale is not determined by Art. 148 of the Tax Code of the Russian Federation, and on the basis of clauses 28, 29 of the Protocol on the procedure for collecting indirect taxes in the EAEU. Therefore, the conditions specified in paragraphs. 3 p. 2 art. 171 of the Tax Code of the Russian Federation are not implemented.

Operation code 1010821

Implementation of works (services), the place of implementation of which is not recognized as the territory of the Russian Federation, clause 29 of the EAEU Protocol (Appendix No. 1 to the Procedure for filling out a VAT return, approved by Order of the Federal Tax Service of October 29, 2014 N MMV-7-3 / [email protected] ) .

What hasn't changed

We continue to fill out and submit section 7 of
the VAT
.

• transactions not subject to taxation (exempt from taxation);
• transactions that are not recognized as an object of taxation;
• operations for the sale of goods (works, services), the place of sale of which is not recognized as the territory of the Russian Federation;
• as well as the amount of payment, partial payment for upcoming deliveries of goods (performance of work, provision of services), the duration of the production cycle of which is more than 6 months.

See also:

• Don't miss the new VAT information from July 1, 2021!
• Determining the place of sale of services by foreigners
• We provide accounting consulting services to foreign buyers. Do I have to pay VAT as a tax agent?
• Work and service: what is the difference?
• Without VAT VS VAT 0%

Procedure for taxation of organizations with foreign capital

As already mentioned, the Russian market is considered quite attractive for foreign investors. As a matter of fact, this is confirmed by a large number of foreign organizations that operate in a variety of fields of activity.

Insurance, banking, auditing are examples of industries where Russian companies have been competing with foreign ones for a long time. For foreign organizations, special operating conditions are provided: for example, there are restrictions on permitted types of activities and accounting.

The procedure for interaction with tax authorities is also somewhat different from that established for Russian companies: a special form of reporting on activities is provided, and there are specifics for filling out a tax return.

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