An updated register of accredited IT companies
Legal Digest \ 18.07.2019“If a company is engaged in information technologies, in order to apply article 259(9) of the Russian Tax Code it ought to use an updated register of accredited companies which can be found on the website of the Russian Ministry of Digital Development, Communications and Mass Media (referred to in Russian as ‘Minkomsvyaz’)”, the Federal Tax Service advises.
At present, IT companies are understood to mean companies that are engaged in the sphere of informational technologies, namely they:
- develop and sell computer programs and databases;
- supply services that involve the development, customization and modification of computer programs and databases;
- install, test and support computer programs and databases.
A number of tax preferences (which are applicable only subject to compliance with certain conditions) are provided for such companies:
- reduced rates of insurance contributions;
- regional profit tax relief;
- ability to hire highly qualified specialists from other regions;
- a refund of input VAT on purchased goods (work and services);
- reduced profit tax for conducting research and development activities; or
- reduced profit tax for instant depreciation.
In the latter case, IT companies may include full costs from the purchase of computer hardware once it is put into operation rather than write off the amounts of depreciation pertaining to such computer hardware on a monthly basis. To exercise such right, the following conditions should be complied with:
- the IT company must have a certificate of state accreditation;
- the sales of IT products should account for at least 90% of all revenues it receives;
- the sales of IT products abroad should account for at least 70% of the revenues from this line of business;
- the IT company’s headcount for the reporting (tax) period should be at least 50 people.
One of the main prerequisites for most of the tax benefits referred to above is a certificate of state accreditation for IT companies. To obtain such accreditation, IT companies are required to submit the following documents to Minkomsvyaz:
- an application for state accreditation;
- a certificate signed by the head of the company evidencing that the company is actually engaged in the sphere of information technologies;
- an extract from the Unified State Register of Legal Entities.
Therefore, to determine whether the company has been listed as an accredited IT company it should check the register on the official website of Minkomsvyaz.
Please contact Acsour’s experts to discover how tax legislation should be applied and how IT companies should apply tax benefits.