The Russian government is going to extend until the end of this year the exemption from personal income tax for businessmen who rewrite assets from foreign structures into personal property, writes Forbes. As the newspaper notes, this is another step taken by the Russian authorities for the withdrawal of assets from offshore.
Exemption from personal income tax is provided for by amendments to the second reading of the bill prepared by the Ministry of Finance on amendments to tax legislation. According to Forbes, having read the text of the amendments, the right is provided for all individuals who are Russian residents, including foreigners. The exemption will also be available to owners of controlled foreign companies (CFCs) in offshore and tax havens.
The government has introduced tax incentives for those who transfer assets from offshore structures to personal ownership, as part of a defense against Western sanctions. The relaxations affected securities and shares in the authorized capital of Russian companies, rights of demand, options, pledges, shares of investment funds of Russian management companies. The tax exemption was valid until the end of 2022.
In order to receive an exemption, it was necessary to submit a corresponding application to the tax office, as well as documents confirming the value of assets according to the records of the transferring foreign structure as of the date of reissuance.
The government does not disclose how many entrepreneurs have already transferred assets to personal ownership without paying taxes and for how much. According to the Boston Consulting Group, in 2020 the value of Russian assets abroad was $400 billion.