Attn.: NSD’s Clients
NSD hereby informs its clients that:
1. A new letter issued by the Russian Ministry of Finance (Letter No. 03-08-05/3944 dated 2 February 2015) has been posted on NSD’s web site (in the ‘Tax Management’ section). According to the said Letter, where a securities depository acting as a withholding agent receives summarized information from a foreign nominee, according to which the actual recipient of income on bonds is a Russian organization, the securities depository shall not withhold tax. Russian organizations are, therefore, solely responsible for calculating and paying corporate income tax in accordance with Chapter 25 of the Russian Tax Code.
2. To comply with the provisions of the said Letter:
2.1. The Reference List of General Tax Rates under the Russian Tax Code, as posted on NSD’s web site (in the ‘Tax Management’ section, under ‘Russian Securities/Foreign Nominees’), has been replaced. The new Reference List contains a line providing for a zero tax rate for the purposes of tax exemption of Russian organizations disclosed by foreign nominees, with respect to interest income:
Налоговый кодекс Tax code |
Тип финансового инструмента Type of financial instrument |
Тип лица Type of person |
Налоговое резидентство Tax residency |
Ставка налога НК РФ Tax rate under the Russian Tax code |
Тип дохода Type of income |
||
---|---|---|---|---|---|---|---|
Статья Aarticle |
Пункт Point |
Подпункт или абзац Subsection or paragraph |
|||||
1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |
246 | 1 | 2 | Облигации/ Russian corporate bonds | Российское юридическое лицо/ Russian Legal Entities | Резидент/ Russian Tax Resident | 0 | Процентный доход/ interest income |
2.2. The relevant amendments have been made to “NSD’s Terms and Conditions of applying tax rates in accordance with the provisions of the Russian Tax Code and double taxation treaties of the Russian Federation”:
TAX DISCLOSURE |
RATES TO BE USED BY THE WITHHOLDING AGENT (NSD) |
|||||
---|---|---|---|---|---|---|
Tax jurisdiction disclosed |
Additional disclosure related to privileges |
EQUITIES | BONDS |
Note | ||
Legal entities | Individuals | Legal entities | Individuals | |||
1 | 2 | 3 | 4 | 5 | 6 | 7 |
Tax resident of the Russian Federation (Russian organization) is disclosed | a reference to the Russian Tax Code – article 246, clause 1, paragraph 2 (Russian corporate bonds) | - | - | 0% | - | Documents confirming the Russian organization’s status |
2.3. Tax Disclosure Example No. 3 for payment of income on bonds has been posted:
Summarized Tax Information:
Entry No. | Tax Jurisdiction* | Legal Entity / Individual (Article 310/214 of the Russian Tax Code) | Reference to the Ground for Application of Tax Benefits (under the Russian Tax Code or International Treaties) | Quantity of Securities | Claimed Tax Rate | ||||
---|---|---|---|---|---|---|---|---|---|
Code | Name | Article Number | Clause of the Article | Subclause/ Paragraph | Additional feature | ||||
1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 |
1 | IT | ITALY | 310 | 11 | 2 | 1100 | 10 | ||
2 | IT | ITALY | 310 | 284 | 2 | 1 | 1200 | 20 | |
3 | IT | ITALY | 214 | 11 | 2 | 100 | 10 | ||
4 | IT | ITALY | 214 | 224 | 3 | 1 | 200 | 30 | |
5 | RU | RUSSIAN FEDERATION | 310 | 284 | 1 | 1500000 | 20 | ||
6 | RU | RUSSIAN FEDERATION | 310 | 246 | 1 | 2 | 10600 | 0 |
* - hereinafter Tax Jurisdiction – country of the tax residents of the disclosed entities
Should you have any question related to this message, please do not hesitate to contact your account manager at (495) 956-27-90 or (495) 956-27-91.