The President of the Russian Federation has signed a Law that establishes the obligation for Russian companies to perform the function of a tax agent and pay tax on electronic services for a foreign supplier.
Starting from October 1, 2022, Russian organizations registered with tax authorities and purchasing services in the Russian Federation in electronic form from foreign organizations are required to calculate and pay VAT on such services as a tax agent.
At the same time, the obligation to pay VAT by a tax agent arises if a foreign legal entity providing electronic services:
Please be reminded that, starting from 2019, Russian companies have been relieved of the duties of tax agents when purchasing services in electronic form. Starting from this period, foreign companies have to independently calculate and pay VAT on the sale of electronic services. To do this, they needed:
However, owing to the current difficulties in transferring funds from foreign bank accounts to the accounts of the Federal Treasury for the purpose of paying VAT, amendments were made to the Tax Code, which again impose the obligation to pay tax on Russian companies – tax agents. Please note that the services in electronic form include:
Acsour recommends checking whether a foreign company providing electronic services to you is registered with the tax authorities and, if necessary, pay VAT on such services for it.