Based on Russia’s Federal Law No. 335-FZ (the Law),1 non-Russian entities providing electronic services to Russian companies (B2B supplies) are obliged, from 1 January 2019, to account for and pay Value Added Tax (VAT) on such transactions on their own behalf. To account for and pay the VAT due, foreign suppliers have to register for VAT purposes in Russia and submit quarterly VAT returns. The tax agent mechanism with respect to the provision of e-services (similar to the “reverse charge”, when the customer pays VAT on behalf of the foreign supplier) was eliminated as of 1 January 2019.
Accordingly, as provided in the Law, the foreign supplier should submit a VAT registration application together with the required documents translated into Russian by 15 February 2019.
1. For background, see EY Global Tax Alert, Russia revises VAT rules for electronic services provided by foreign companies, dated 12 January 2018.
EYG no. 000192-19Gbl
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