personal income tax rate for employees who have left abroad will remain at the level of 13-15% – Kommersant

Deputy Finance Minister Alexei Sazanov said that the personal income tax rate for employees who have gone abroad and work remotely both under labor contracts and under civil law contracts will be the same and will be 13-15%. This item is contained in the updated version of the draft law on amendments to the Tax Code, which were previously withdrawn from the State Duma, he added. A new version of the bill has been prepared for submission to the State Duma.

“Regardless of their status – Russian tax resident, non-resident – their income will be taxed at the personal income tax rate of 13/15% provided for Russian tax residents. Clarification of the types of income of remote employees and the application of a single tax rate will significantly simplify the tax administration mechanism for tax agents,” said Alexei Sazanov, his words are quoted on site Ministry of Finance.

Mr. Sazanov explained to journalists that, according to the current legislation, Russian organizations need to determine the tax rate for remote employees “depending on each specific situation.” In this regard, it is proposed to “unify” these rules. “This will significantly simplify the administration mechanism for tax agents,” he added.

Amendments to the Tax Code were made April 24th. They assumed that for those employees who lost their tax residency (that is, they work from abroad for more than 183 days within 12 months), the personal income tax rate should be 30%. The amendments concerned only persons working under a GPC agreement. April 25 government withdrew bill, explaining this by the need to “make technical clarifications.”

According to the current Tax Code, payments from Russian companies to non-residents for performing remote work in another state are considered income received from sources outside of Russia. They are not subject to income tax. If the remote worker is still a resident, then he himself declares his income in the form of 3-personal income tax and pays income tax to the budget.

Lusine Balasyan