How taxes and our lives will change from October 2021

Some intermediaries are not tax agents

First of all, the latest news about changes to VAT in 2021 was brought by Federal Law No. 335-FZ of November 27, 2017 (hereinafter referred to as Law No. 335-FZ).
According to it, from January 1, purchasers of a number of goods must perform the duties of tax agents for VAT. These changes apply to the VAT on scrap metal from 2021. And also (new clause 8 of Article 161 of the Tax Code of the Russian Federation):

• ferrous metal and non-ferrous metal waste;
• raw animal skins;
• secondary aluminum and its alloys.

Sales of these types of goods in Russia are no longer exempt from value added tax. That is, the buyer, as a tax agent, calculates VAT. An exception is made only for ordinary individuals who do not have individual entrepreneur status.

Let us recall that tax agents must calculate and transfer to the treasury the appropriate amount of VAT, regardless of whether they are responsible for paying this tax.

Also see “How to calculate VAT”.

1. Subjects of the all-Russian payment system.

2. Telecom operators that are specified in the Law of June 27, 2011 No. 161-FZ “On the National Payment System”.

VAT rate change

From October 1, the VAT rate on fruits and berries will be reduced (Federal Law dated August 2, 2019 No. 268-FZ).

Until this time, the tax rate for fruit and berry products was 20%. According to the new rules for the sale of fruits and berries (including grapes), a preferential VAT rate of 10% will now be applied.

At the same time, the preferential 10% VAT rate on palm oil is abolished. Now, when implementing it, a general tax rate of 20% will apply.

What are the changes regarding VAT?

The changes affected corporate property tax, profit tax and VAT. In addition, a number of adjustments have been made to part one of the Tax Code of the Russian Federation concerning tax audits and controlled transactions.

The procedure for determining the tax base for VAT when the taxpayer receives an advance payment towards the upcoming transfer of property rights has been clarified. For example, when transferring rights to residential buildings, garages and parking spaces. The tax base will be determined as the difference between the amount of the advance and the amount of expenses for the acquisition of these rights.

The procedure for determining the tax base for VAT upon receipt of an advance payment

In accordance with the new edition of Article 154 of the Tax Code of the Russian Federation, when assigning a monetary claim arising from a contract for the sale of goods (work, services), transferring property rights to residential buildings or residential premises and shares in them, garages and parking spaces, and receiving for this prepayments, the tax base is determined according to new rules. In particular, the following paragraph was added to the article:

When the taxpayer receives payment, partial payment on account of the upcoming transfer of property rights in the cases provided for in paragraph two of paragraph 1 and paragraphs 2 - 4 of Article 155 of the Tax Code of the Russian Federation, the tax base is determined as the difference between the amount of payment, partial payment received by the taxpayer on account of the upcoming transfer of property rights rights, and the amount of expenses for the acquisition of these rights (the size of the monetary claim, including future claims), determined based on the share of payment, partial payment in the cost at which property rights are transferred.

In this case, VAT paid on prepayment can be deducted according to the new edition of Article 171 of the Tax Code of the Russian Federation and in the manner prescribed by Article 172 of the Tax Code of the Russian Federation.

For what purpose were the amendments made?

The law was developed based on the results of work carried out by experts and the business community to identify measures that require a priority decision as part of the “customization” of the tax system, the need for which was indicated by the President of Russia in his Address to the Federal Assembly of December 1, 2016.

The amendments are aimed at streamlining documents submitted to the tax authorities, reducing the administrative burden on businesses, and ensuring stability and predictability of the tax system.

When there is no right to deduct input VAT

Also, changes to VAT from January 1, 2021 affected recipients of subsidies and investments from the treasury. From this date, payers do not have the right to deduct input VAT on goods, works or services purchased at the expense of these government funds (new clause 2.1 of Article 170 of the Tax Code of the Russian Federation).

There is no right to deduct VAT even if the subsidy goes to the authorized capital of the enterprise.

In connection with this amendment, the tax restoration mechanism is spelled out in more detail, when the subsidy pays for the purchase price, but partially.

Also see “The most common VAT violations for 2017.”

Changes in VAT from October 1, 2021. All latest information as of October 4, 2018

Next, the forwarder, when performing the service, or the developer, when transferring the object to the customer, registers a consolidated invoice in Part 1 of the journal, highlighting individual items for each seller (customs declaration).

Intermediaries, freight forwarders and developers will continue to maintain a log of invoices. In addition, this obligation will also apply to taxpayers who are exempt from obligations related to the calculation and payment of VAT, as well as to persons who are not VAT taxpayers.

According to paragraph 14 of Art. 171 of the Tax Code of the Russian Federation, the amount of tax calculated by the taxpayer upon import of goods based on the results of the tax period in which the 180-day period has expired from the date of release of these goods in accordance with the customs procedure for release for domestic consumption upon completion of the customs procedure of the free customs zone in the territory

Special economic zone in the Kaliningrad region can be taken for
deduction after
using these goods to carry out transactions recognized as objects of taxation and subject to taxation in accordance with Chapter 21 of the Tax Code of the Russian Federation.

Changes in VAT from October 1 latest news. Summary for today.

3. If the principal has not received an electronic invoice from the company, the company has the right to issue a paper version. Technical correction. Such rules were already in the magazine, but for sellers and buyers. However, intermediaries could also register a paper invoice instead of an electronic one. Moreover, now only they keep the journal.

In column 3, reflect not the number, but the registration number

customs declaration. It is also shown in the VAT return - line 150 of section 8 - and in the appendix to it.

If the goods are from EAEU countries, then enter the number and date of the application for import and payment of indirect taxes. If there are several documents for payment or customs declarations, enter the details separated by a semicolon “;”.

There are also quite a few amendments to VAT from October 1, 2021 related to

with the fulfillment of the duty of keeping a journal. Thus, changes in VAT at the legislative level from October 1, 2021 clarified a number of issues, for example, when it is not necessary to keep a journal.

Changes in VAT from October 1. Fresh material as of 10/04/2018

According to the innovation in the legislation, from now on taxpayers have the right not to draw up an invoice for those counterparties (buyers of services, works, goods) who are not VAT payers or are exempt from paying value added tax.

Example: A company using OSNO sold goods to a company using the simplified tax system. The goods are subject to VAT. The company on OSNO must issue an invoice with allocated VAT. If the seller and buyer have entered into an agreement not to issue invoices, then the company on OSNO has the right not to issue an invoice to the company on the simplified tax system.

When reflected by the seller (in the event of a decrease in the cost of goods (work, services, property rights) shipped (performed, rendered, transferred) to the persons specified in paragraph 1 of paragraph 3 of Article 169 of the Tax Code of the Russian Federation) in the purchase book of data on the document containing summary (summary) data on transactions performed by the seller during a calendar month (quarter), column 5 indicates the serial number and date of the adjustment document containing summary (consolidated) data on transactions performed by the seller during a calendar month (quarter).

Changes in VAT from October 1. Recent events.

No VAT when transferring target property in special economic zones

Based on the Law of November 27, 2017 No. 351-FZ, from January 1, 2018 there is no VAT on the free transfer to regional and municipal authorities of property created for the implementation of agreements on the creation of special economic zones - SEZ (Articles 146 and 170 of the Tax Code of the Russian Federation).

Example

A joint-stock company, 100% of the shares of which belongs to the Russian Federation, created within the SEZ, transfers property to companies created with its participation - SEZ management companies.

In addition, SEZ JSCs and management companies are no longer required to restore the amounts of VAT previously deducted on such property.

From 2021, movable property is not subject to corporate property tax. The concept of “movable property” is excluded from the object of taxation.

In connection with the abolition of the movable property tax, the procedure for determining the tax base has been changed. According to the new edition of clause 1 of Article 376 of the Tax Code of the Russian Federation, the tax base is determined separately in relation to each piece of real estate. Accordingly, all rules on benefits for movable property within the rate of 1.1%, which regions can now set, are abolished.

More taxpayers will have the right to apply for a VAT refund

Currently, taxpayers-organizations that have paid at least 7 billion rubles to the budget over the three calendar years preceding the submission of an application for the application of this procedure have the right to an accelerated VAT refund procedure. taxes. Now this amount will decrease to 2 billion rubles. This means that even more taxpayers will be able to take advantage of this procedure.

The requirements for the guarantor have been similarly relaxed.

The possible amount of the guarantor's obligations has also been increased: now it can be up to 50% of the value of his net assets. Before the changes, the amount was within 20%. Thanks to the changes, the guarantor will be able to issue more orders (clause 10, article 2 of Law No. 302-FZ). These changes are effective from 10/01/2018.

Zero VAT for re-export: conditions

Operations for the sale of goods exported as part of re-export were affected in 2021 by a change in the VAT rate to zero (Federal Law No. 350-FZ dated November 27, 2017, hereinafter referred to as Law No. 350-FZ). In this case, a mandatory condition of 0% VAT is if previously the goods (including processed products, waste, residues) underwent the following customs procedures (subclause 1, clause 1, article 164 of the Tax Code of the Russian Federation):

• processing in the customs territory;
• free customs zone;
• free warehouse.

According to the law, in order to confirm zero VAT for re-export, you need to submit to the Federal Tax Service, among other things, the following documents:

• original or copy of a foreign trade contract;
• original or copy of customs declarations;
• copies of transport and shipping certificates.

Shipment in 2021, payment in 2019

Strictly speaking, the situation when the delivery is dated 2021, and payment was received in 2021, is not transitional. The fact is that in this case, the VAT tax base is determined at the time of shipment and subsequently does not change (subclause 1, clause 1, article 167 of the Tax Code of the Russian Federation). This means that the supplier must charge VAT at the rate in force in 2021, namely at the rate of 18%. It does not matter what the tax rate will be during the payment period, because, despite its change, the tax base will remain the same.

Example 5

In 2021, Warehouse LLC shipped goods worth RUB 354,000 to Department Store LLC. (including VAT at a rate of 18% - 54,000 rubles) and issued an invoice. At the same time, “Warehouse” charged VAT in the amount of 54,000 rubles, and “Department Store” deducted tax in the amount of 54,000 rubles. As of December 31, 2021, the Department Store's debt to the Warehouse was RUB 354,000.

In 2021, Department Store LLC transferred 354,000 rubles to the settlement account of Sklad LLC, as a result of which its debt was reduced to zero. The parties did not take any additional actions related to VAT calculations.

Application procedure for VAT refund

Amendments to Article 176.1 of the Tax Code of the Russian Federation have reduced the minimum threshold of taxes paid for using the declarative procedure for VAT refund from 7 billion to 2 billion rubles. For guarantors, the requirement to pay taxes is also reduced from 7 billion to 2 billion rubles. At the same time, the amount of obligations under guarantees increases from 20% to 50% of the value of net assets.

Yes, the period for conducting a desk tax audit of a VAT return is reduced from 3 to 2 months. Tax officials will be able to extend the inspection period to 3 months if facts are established indicating the presence of violations. For example, such a basis for extending the inspection to 3 months may be the fact of discrepancies in the documents of the seller and the buyer.

Payment of excise taxes

According to the provisions of Article 198 of the Tax Code of the Russian Federation, the minimum amount of taxes paid by an organization for exemption from excise duty when re-exporting without providing a bank guarantee has been reduced from 10 billion to 2 billion rubles. Similar amendments have been made in relation to the amounts of taxes paid by the guarantor. At the same time, the amount of obligations under guarantees increases from 20% to 50% of the value of net assets.

The new version of Article 203.1 of the Tax Code of the Russian Federation stipulates that a bank guarantee is not provided by taxpayers - organizations that produce excisable goods on the basis of an agreement for the processing of customer-supplied raw materials, if the owner of the raw materials (materials) has a total amount of taxes paid of at least 2 billion rubles.

Zero VAT for re-export: conditions

It has become possible to abandon the zero VAT rate for exports and related services - this is another new thing in the payment of VAT in 2021 thanks to Law No. 350-FZ (new edition of Article 164 of the Tax Code of the Russian Federation).

These changes give exporters the right to refuse the 0% VAT rate:

• directly when exporting goods;
• their transportation.

To do this, you need to submit a corresponding application to the tax office. The deadline is until the 1st day of the quarter from which the company wants to deduct VAT at a rate of 10 or 18%.

And you can’t:

• apply different rates to a product even when purchased by different people;
• selectively waive zero VAT on specific transactions.

In addition, if you refuse zero VAT, you can return to it only after 1 year.

The VAT rate has been set at 0% for goods sold that are exported from Russia to the countries of the Eurasian Economic Union (EAEU): Armenia, Belarus, Kazakhstan, Kyrgyzstan. The procedure for its use is prescribed.

A 0% VAT rate for export can be confirmed by a contract with a Russian organization for the supply of goods to its separate division outside the customs territory of the EAEU. Now, to confirm the zero rate, you need a contract with a foreign organization or a copy thereof. This requirement creates difficulties.

Contracts (agreements) previously submitted to the tax authority are not subject to re-submission for the purposes of applying the zero VAT rate. Instead, you should send a notification to the tax authorities. It indicates the details of the document with which the contract or agreement was submitted, as well as which inspection it was sent to.

The rules on documents confirming the right to a zero VAT rate on export transactions are undergoing significant changes. Copies of transport, shipping and (or) other documents are excluded from the list of such documents. These documents will need to be submitted only when exporting supplies, as well as at the request of the tax authorities, if any inconsistencies are identified.

There are also other amendments to the export VAT.

The procedure for confirming the zero VAT rate

According to the norms of the new edition of Article 165 of the Tax Code of the Russian Federation, it is now possible to confirm the zero VAT rate for exports, among other things, by a contract (a copy of the contract) with a Russian organization for the supply of goods to its separate division, which is located outside the EAEU. Moreover, if such contracts were previously submitted to the Federal Tax Service to justify the application of the zero tax rate for VAT or to justify exemption from excise duty for previous tax periods, their resubmission is not required. Instead, it is necessary to submit a notification indicating the details of the document with which the specified documents were submitted and the name of the tax authority to which they were submitted.

Also, taxpayers now may not submit to the Federal Tax Service of Russia copies of transport, shipping or other documents with marks from the customs authorities of the places of departure confirming the export of goods outside the Russian Federation. When exporting to the EAEU, it is possible not to submit these documents if the list of applications for the import of goods and payment of indirect taxes is presented in electronic form. But if the tax authority discovers an inconsistency in the information provided by the taxpayer, or its absence, the tax authorities have the right to request copies of documents confirming the export of goods outside the Russian Federation. These rules begin to apply to operations for the sale of goods (works, services) carried out starting from October 1, 2021.

When compensating tax amounts, participants in the “tax free” system must submit a register to the Federal Tax Service, which indicates information from documents (checks) for compensation of the tax amount, containing a mark from the customs authorities of the Russian Federation confirming the export of goods outside the customs territory of the EAEU and information about the compensated amount VAT. This register must contain information about the size of the tax base to which the taxpayer applies a zero tax rate.

What innovation will allow you to argue more competently with tax authorities?

Inspectors will be required to hand over a copy of the interrogation protocol to the witness in person against signature. Let us remind you that now inspectors are not obliged to provide the witness (often an employee of the organization being inspected) with a copy of the interrogation protocol, even if he asks for it. Now the received copy of the protocol will allow you to better prepare for a possible dispute with the tax office.

The deadline for submitting documents and information on a specific transaction has been extended from five to 10 working days. The period is calculated from the date of receipt of the tax authorities’ request. Such information may be requested from the parties to the transaction or other persons who have the necessary information. If you do not have documents and information, please report this within the same period.

Documents for zero VAT on parcels abroad

In addition to payments, you can choose what to submit from 2 options (new sub-clause 7, clause 1, article 165 of the Tax Code of the Russian Federation):

• original or copy of the CN 23 declaration (with Russian customs marks);
• original or copy of the customs declaration (with Russian customs marks) and original or copy of the CN 23 declaration.

The point is that for 2021, a separate list of supporting documents for international postal parcels was not clearly stated in the Tax Code of the Russian Federation.

Let us remind you that export VAT must be justified 180 calendar days after the start of this customs procedure. The documents are submitted along with the declaration for this tax.

Also see “New VAT return form from 2021: what has changed in it.”

We study changes in VAT: exports, refunds and others

Federal Law No. 302-FZ of August 3, 2018 introduced targeted amendments to VAT, which will come into force on October 1, 2021.

• The procedure for determining the tax base when receiving an advance payment for the transfer of certain property rights is being clarified.

The Tax Code of the Russian Federation established the obligation to calculate VAT on the advance payment for the transfer of rights to residential buildings, garages and parking spaces. The tax base will be the difference: prepayment minus the costs of acquiring the assigned rights. The amount of expenses will be determined in proportion to the share of the prepayment. When transferring property rights, VAT paid on the advance payment can be deducted.

• The procedure for confirming the zero VAT rate for exporters is being simplified

Firstly, exporters will be able to confirm the application of a zero VAT rate when selling goods to separate divisions of Russian organizations opened abroad by a contract with such a Russian company or a copy thereof.

Secondly, to confirm the zero VAT rate for exports, it will not be necessary to submit transport documents along with the VAT return. The tax authority will request them from the taxpayer as part of an audit only in certain cases, in particular, if this information is not provided by the customs authorities. For goods sold for export from October 1, 2021, exporters will be able to submit to the tax authority only contracts and customs declarations or registers of the latter.

Thirdly, exporters submitting registers of customs declarations, when requesting documents included in the register, will be able to submit them without notes from the customs authority about the departure of the goods.

Fourthly, exporters will not need to re-submit a sales contract to confirm export.

• Expand the right of taxpayers to apply for VAT refund. Organizations that have paid taxes in the amount of at least 2 billion rubles over the previous three years will be able to exercise the right to receive VAT refund through application. (was 7 billion rubles). Similarly, the threshold for paid taxes for the guarantor has been reduced. The innovations will be earned from the compensation declared in the declaration for the fourth quarter of 2021.

For the full text of the document, see SPS ConsultantPlus

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Is there a restriction on re-requesting documents?

Yes, the amendments define how to act if inspectors request documents or information again. It has been established that documents (information) previously submitted to the tax authorities, regardless of the basis for their submission, may not be submitted provided that the tax authority is notified within 10 business days of receipt of the request that they have already been submitted.

The notification must indicate where the requested information was submitted, as well as provide details of the document with which it was sent.

VAT changes

We recently wrote that starting next year the VAT rate will be increased to 20% . But other changes will soon be made that will affect the taxpayers of this tax.

The period of desk inspection will be reduced

The period for a desk audit for VAT will be reduced to 2 months . The corresponding change to paragraph 2 of Article 88 of the Tax Code of the Russian Federation will take effect on September 3 of this year. Tax officials will be able to extend the period of the cameral up to 3 months if they suspect during the audit that tax violations are taking place.

The procedure for confirming the zero rate will be simplified

Exporters are entitled to 0% VAT, but they must confirm it. To do this, they submit to the Federal Tax Service, among other things, shipping and transport documents. Soon this will not be necessary - tax authorities will receive them from customs . If the customs authority does not provide the documents or they contain discrepancies, then the Federal Tax Service specialists will request them from the taxpayer. These are the rules of paragraph 1.2 of Article 165 of the Tax Code of the Russian Federation.

In addition, the deadline for sending documents requested by the Federal Tax Service when discrepancies are identified has been changed. It has been increased from 20 calendar days to 30 . Documents can be sent without marks from the customs authorities of the Russian Federation. Such provisions are contained in the new wording of paragraph 15 of Article 165 of the Tax Code of the Russian Federation.

Among other things, exporters will be freed from the need to attach contracts and agreements that had previously been submitted to the inspectorate to their VAT returns. It is enough to submit a notification indicating the details of the document with which the mentioned agreements were previously submitted to the tax authority. Changes have been made to paragraph 10 of Article 165 of the Tax Code of the Russian Federation.

Among other things, the new wording contains subparagraph 1 of paragraph 1 of the same article. A rule has been introduced for exporters for transactions for which the recipients are divisions of Russian legal entities outside the Customs Union. When confirming the zero VAT rate for such transactions, a contract with a Russian organization or a copy thereof . The subject of the contract must be the delivery of goods to the representative office of this organization outside the EAEU.

The block of changes listed above will go into effect on October 1, 2018 . They will apply to transactions made after this date.

There is one more change - it will work from April 1, 2019. It will be introduced by a new paragraph 20 of Article 165 of the Tax Code of the Russian Federation. When providing services for the international transportation of goods, freight forwarding services and transportation by railway transport, paper copies of transport and shipping documents may not be required. Instead, their electronic analogues will be used, generated in accordance with the approved format and transmitted through the EDI operator.

VAT refunds will be simplified by application

For transactions carried out after October 1, 2018 , the rules for VAT refunds by application will be simplified. Subclause 1 of clause 2 of Article 176.1 of the Code is stated in a new wording. It is expected that the amount of taxes paid for applying the application procedure will be reduced from 7 billion to 2 billion rubles. Let us remind you that the amount of VAT, excise taxes, and mineral extraction tax on profits tax paid for the three previous years is taken into account.

Also, the total amount of taxes paid for the three previous years by the company that acts as a guarantor in the application procedure was reduced from 7 billion to 2 billion rubles. At the same time, the share of net assets corresponding to the amount of obligations under guarantee agreements has been increased for guarantors. For now it is 20%, but starting from October 1, 2021 it will be equal to 50% . In addition, the guarantor will be subject to requirements for the absence of debt not only for taxes, including penalties and fines, but also for insurance premiums.

The “five percent rule” has been clarified

Regarding VAT, new legislation in 2021 affects companies that have taxable and non-taxable transactions. Changes were made by Law No. 335-FZ.

Thus, clause 4 of Art. has been clarified. 170 of the Tax Code of the Russian Federation, which talks about the “five percent rule”. In particular:

• compliance with it allows you to deduct input VAT in its entirety, while from 01/01/2018 it is impossible not to maintain separate accounting;
• This rule does not apply when the goods are involved only in non-VAT-taxable transactions.

The grounds for recognizing transactions as controlled have been clarified, so there will be fewer of them. For example, domestic transactions worth over 1 billion rubles are exempt from transfer pricing control.

Transactions through intermediaries, as well as transactions with interdependent foreigners, will be controlled if their annual income exceeds 60 million rubles. Before the adoption of the amendments, such transactions came under control regardless of the amount of income.

The list of persons recognized as tax agents for VAT has been expanded. Now they also include Russian railway carriers carrying out activities on the territory of the Russian Federation in the interests of another person on the basis of intermediary agreements related to the provision of services for the provision of rolling stock and (or) containers.

The "five percent rule" has changed

If during a quarter a product is used in both taxable and non-VAT-taxable transactions, the proportion must be calculated. This proportion allows you to determine the part of the input VAT that needs to be deducted, and the part that will have to be taken into account in the cost of goods.

But the proportion could not be observed if during the quarter expenses for preferential transactions were less than 5% of the total amount of expenses. At the same time, organizations could not keep separate records.

But according to the new rules, in order to apply the “five percent rule”, you will have to keep separate records. Only in this case, the entire input VAT on goods that were used in both taxable and non-taxable transactions can be deducted.

Conclusion - for goods involved only in transactions not subject to VAT, the deduction cannot be applied.

VAT 0% on air transportation in the Kaliningrad region

Law No. 353-FZ dated November 27, 2017 introduced zero VAT on domestic air transportation of passengers and baggage in the Kaliningrad region from January 1, 2021. This is a new sub. 4.2 clause 1 art. 164 Tax Code of the Russian Federation.

The procedure for reviewing materials received by tax authorities during tax audits and additional tax control activities has been clarified. Now the person being inspected (his representative) has the right to familiarize himself with the inspection materials before their consideration. If the taxpayer is not given this opportunity, the relevant evidence will not be examined during the examination.

The procedure for carrying out additional tax control measures (requesting documents, questioning witnesses and conducting examinations) has also been clarified. If, before the adoption of the amendments, inspectors did not draw up any single document completing additional measures, now they will be required to draw up an addition to the tax audit report.

Thanks to this, it will be easier to understand what exactly the inspectors’ complaints are. Tax officials will be required to provide the taxpayer with an addition to the act within 5 business days from the day this addition is issued. They will have to attach to it the materials received during additional activities. The taxpayer will be able to submit written objections to the addition to the act within 15 days from the date of receipt of such addition.

The seller, not the tax agent, will prepare the invoices

From January 1, 2021, the sale of scrap and waste of ferrous and non-ferrous metals is subject to VAT.
And buyers of scrap metal become tax agents. Scrap sellers will prepare their own invoices excluding VAT. They will need to indicate that VAT is calculated by a tax agent. In this case, the tax agent will be the buyer of recyclable materials. He will have to charge tax at the estimated rate of 18%/118% or 10%/110% and pay it to the budget. Moreover, regardless of whether he is a VAT payer or not. Based on the invoice received from the seller (including an advance invoice), the buyer will be able to deduct the paid VAT. In addition, buyers will be required to declare seller tax on an electronic return. It is submitted to the tax office according to the TKS no later than the 25th day of the month following the reporting quarter.

The same rule will apply to sellers of raw animal hides, as well as recycled aluminum and its alloys.

Tax free law

The law will come into force on September 3, 2021, with the exception of certain provisions. For example, the amendment to pay VAT on prepayments for the transfer of property rights will take effect on October 1.

For foreigners, changes in the payment of VAT from 2021 will be especially relevant. The fact is that Law No. 341-FZ dated November 27, 2017, finally introduced a tax-free mechanism in Russia on January 1. This is the right of foreigners (not from EAEU countries) to receive a VAT refund on purchases made in Russia (tax free).

Moreover, the new VAT refund system definitely does not apply to excisable goods. It is possible that the Russian Government will expand this stop list.

To receive a VAT refund, a foreigner must purchase goods worth at least 10,000 rubles within 24 hours. You can return the tax by bank transfer or in cash through the operator at the airport. This is regulated by the new Article 169.1 of the Tax Code of the Russian Federation.

It is important that sellers who participate in the tax free mechanism will be able to deduct VAT that was returned to foreign individuals. It is believed that this is a very beneficial system for the budget of our country.

1. The enterprise (its division) is engaged in retail trade.

2. It deducts VAT.

3. Included in the special register of the Ministry of Industry and Trade of Russia.

And that's not it. The Government of the Russian Federation, by a separate resolution, establishes:

• locations of such trading firms;
• conditions that they must meet in order to be included in the tax free system.

As a result, the tax will be returned to the seller on the basis of a tax free check with a customs mark on the export of the goods and provided that the VAT on it is compensated to the foreigner. The deduction is due to the seller within 1 year from the day when the foreigner is compensated for VAT.

Let us clarify that foreigners will be reimbursed for VAT directly by trading companies or other payers who have entered into agreements with them. These services are subject to 0% VAT. The right to zero tax, of course, will have to be confirmed. But from 10/01/2018 it will be easier to do this.

Electronic Tax Free system

On October 1, the introduction of the electronic Tax Free system will begin in Russia. Under the new system, trade organizations will issue Tax Free checks with a special barcode to foreigners. Information about the check will automatically be sent to the FCS electronic system. When departing from Russia, the tourist will present the goods and a receipt at customs.

The scanned information will be sent in electronic form to the Tax Free operator and to the Federal Tax Service of Russia. After this, the foreigner will be refunded the VAT paid.

The experiment to introduce an electronic Tax Free system will initially work at Moscow airports. From 2021, the system will operate throughout the country.

The list of airport services will be established by the Government of the Russian Federation

As you know, there is no VAT on services provided directly at Russian airports and the airspace of our country for aircraft maintenance, including air navigation services (subclause 22, clause 2, article 149 of the Tax Code of the Russian Federation). But what exactly are these airport services? It seems that the long-standing confusion on this issue has come to an end.

Thus, Law No. 305-FZ dated October 30, 2017, with amendments to the Tax Code of the Russian Federation, says that from January 1, 2018, the list of airport services that are free of VAT is determined by a separate document by the Government of the Russian Federation.

No VAT when releasing materiel from the state reserve

By virtue of the Law of November 14, 2017 No. 316-FZ, from January 1, 2018, the release of material assets to responsible custodians and borrowers from the state reserve is exempt from VAT due to:

• their refreshment;
• replacements;
• in order of borrowing.

Special rules for determining the tax base and the procedure for determining the VAT rate for the sale of valuables by responsible custodians and borrowers are also regulated.

Also see “What will change in 2021: taxes, insurance premiums, reporting, accounting and a new fee.”

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New rules for VAT tax agents

The responsibilities of tax agents for VAT were assigned to railway carriers, who, within the framework of intermediary relations, sell services for the provision of rolling stock and containers. This rule does not apply to services listed in subparagraphs 2.1 and 2.7 of paragraph 1 of Article 164 of the Tax Code of the Russian Federation, which are taxed at a zero VAT rate.

This is stated in the new paragraph 5.1 of Article 161 of the Tax Code of the Russian Federation (clause 2 of Article 2, clause 2 of Article 4 of Law No. 302-FZ).

In addition, the obligation to keep a journal of invoices for intermediary tax agents listed in paragraphs 4, 5 and 5.1 of Article 161 of the Tax Code of the Russian Federation (subparagraph “b”, paragraph 7 of Article 2 of Law No. 302-FZ) has been canceled. These are the VAT tax agents:

• when selling ownerless, confiscated property (clause 4 of article 161 of the Tax Code of the Russian Federation);
• sales of goods (works, services, property rights) of foreign persons under intermediary agreements (clause 5 of Article 161 of the Tax Code of the Russian Federation);
• implementation of services for the provision of rolling stock and containers for railway transportation within the framework of intermediary relations (clause 5.1 of Article 161 of the Tax Code of the Russian Federation).

Also, tax agents (clauses 4, 5, 5.1 of Article 161 of the Tax Code of the Russian Federation) were given the opportunity to deduct VAT (clause 8 of Article 2 of Law No. 302-FZ):

• paid to the budget upon sale of goods (works or services), if in the future the buyer returns the goods (including during the warranty period) or refuses them or the work performed or services rendered;
• paid to the budget from the advance received, if it is returned to the buyer when conditions change or upon termination of the relevant contract.

Corresponding changes have been made to paragraph 5 of Article 171 of the Tax Code of the Russian Federation. They come into force on October 1, 2018 and apply to transactions made after this date.

Income tax

Starting from 2021, the scheme for participants to deposit funds (property, property rights or non-property rights in the amount of their monetary value) into the account or balance sheet of an organization with the wording “in order to increase the net assets of the company” will not work. Such wording is excluded from paragraphs. 3.4 clause 1 art. 251 of the Tax Code of the Russian Federation as amended by Federal Law No. 286-FZ of September 30, 2017.

From January 1, 2021, the following will be exempt from taxation (clauses 3.4, 3.7 clause 1 of Article 251 of the Tax Code of the Russian Federation as amended by Federal Law No. 286-FZ of September 30, 2017):

• income in the form of unclaimed dividends by participants, or part of the distributed profit of a business company or partnership, restored as part of retained earnings (that is, what the organization already had);
• income in the form of property, property rights or non-property rights in the amount of their monetary value, which were received as a contribution to the property of a business company or partnership in the manner established by the Civil Code of the Russian Federation.

Income in the form of property rights to the results of intellectual activity identified during the inventory carried out by the taxpayer is exempt from taxation. This benefit is valid for only two years: from January 1, 2021 to December 31, 2019 inclusive. This period was established by legislators for the identification and legal registration of previously unaccounted for intangible assets (new clause 3.6 clause 1 of Article 251 of the Tax Code of the Russian Federation, introduced by Federal Law No. 166-FZ of July 18, 2017).

From January 1, 2021, taxpayers can apply a special increasing factor to the depreciation rate, but not higher than 2, only to fixed assets that have high energy efficiency and are not buildings (clause 4, clause 1, article 259.3 of the Tax Code of the Russian Federation, as amended by the Federal Law of September 30, 2017 No. 286-FZ).

New procedure for VAT exemption

From October 1, a new procedure for exemption from VAT is introduced when transferring goods, work or services within the framework of charity (Federal Law No. 210-FZ dated July 26, 2019). Currently, the transfer of goods, work results and services free of charge as part of charitable activities is exempt from VAT. But this norm does not contain a list of documents necessary to confirm the rights to use it.

According to the new rules, in order to be exempt from paying tax, you will need to provide an agreement with the recipient of charitable assistance on the gratuitous transfer, documents confirming the registration by the recipient of charitable assistance of goods received free of charge, acts indicating the intended use of the received goods or property rights (works, services).