Blog

  • Home
  • Blog
  • Russian Tax Authority has received data on foreign accounts and assets of its citizens in 58 countries

Russian Tax Authority has received data on foreign accounts and assets of its citizens in 58 countries

Mar 06, 2019

Russian Federal Tax Service (FTS) received data about foreign assets of Russian citizens in 58 jurisdictions, including the Cayman and British Virgin Islands, Mauritius and other offshore tax jurisdictions or jurisdictions with low taxation. The number of citizens with accounts abroad and the number of companies controlled by them is yet to be disclosed by the FTS. Deputy Head of the FTS Alexei Overchuk commented:

"This is an absolutely new level of tax transparency. Previously it was necessary to file an official request with the competent authority of a foreign jurisdiction, but now information about existing foreign accounts of a specific taxpayer is granted without delay".

During 2019, the FTS will compare received information with reports submitted by taxpayers. Representatives of the FTS estimate that 80–85 percent of the information received via automatic exchange will correspond with the information already in possession by the authority. It is presumed that only 10–15 percent of information may differ.

It is also worth noting that the FTS also transmits data related to bank accounts of non-residents to relative foreign authorities. Banks, insurance and management companies, depositories and brokers must inform the FTS about foreign clients with assets from $1 million and companies with accounts ranging from $250 thousand by means of a so called “electronic service”.

HOW DOES AUTOMATIC EXCHANGE OF TAX INFORMATION WORK?

The automatic exchange is part of the Organization for Economic Co-operation and Development (OECD) global plan to combat tax evasion and illegal profit withdrawal schemes. The FTS has been receiving data about foreign accounts of Russian taxpayers since September 2018. Currently there are 75 countries and 13 territories that participate in the automatic exchange. These reports disclose the name, account number, balance, annual turnover, investment income, earnings from sales of shares, interest on deposits, bonds, etc. Comparing this data with received declarations will allow to identify any tax violations.

Read our blog to keep abreast of all interesting and actual corporate news.

Back to list