The last opportunity to eliminate currency control risks

February 29th, 2020 is the deadline for submitting a special tax return in the framework of the Russian tax amnesty. The “third wave” amnesty allows to declare foreign bank accounts, CFCs, real estate and several other types of property.

Submission of a special tax return guarantees exemption from tax offenses liability, as well as criminal and administrative liability.

Tax amnesty has become specifically relevant due to the latest amendments into the Russian currency control regulations (as of 02.12.2019). According to these amendments, transferring funds to the bank accounts in jurisdictions which do not automatically exchange financial information with Russia (e.g., USA, UK, Turkey, Lithuania, Ukraine and Montenegro) are subject to significant restrictions.

In particular, from December 2nd, 2019 the following types of transactions cannot be executed via the abovesaid accounts:

  • Foreign currency loans,
  • Coupon yield,
  • Dividends,
  • Capital gains on sales of securities,
  • Redemption of bonds etc.

Conducting the above-mentioned transactions may result in imposing fines ranging from 75% to 100% of the amount of such transactions. Thus, those who failed to transfer assets to the “exchanging” jurisdictions prior to 02.12.2019 still have the opportunity to use the tax amnesty and avoid fines.

ALTHAUS Private Tax experts are ready to advise on the use of the amnesty in each particular situation and prepare and submit a special tax return within the shortest timeframes possible.