Quite often, it is not profitable for a foreign entrepreneur to open a representative office of a company or its branch in the Russian Federation. It is much easier, faster and more rational to establish a legal entity - a limited liability company with foreign participation.
Can a foreign citizen be the founder of an LLC?
Yes, both a foreign individual and a foreign company have such a right. When exercising this right, you should study the following laws:
1. A foreign investor has the right to make investments on the territory of the Russian Federation in any forms not prohibited by the legislation of the Russian Federation (Article 6 of the Federal Law 160-FZ “On Foreign Investments”).
2. The legal status of the LLC, powers, obligations of participants, regulations for creation, reorganization and liquidation are determined by a single document for residents and non-residents (Federal Law 14-FZ “On LLC”). It also contains the procedure for forming the authorized capital of an LLC.
Important! A company cannot have another business company consisting of one person as its sole participant.
3. The registration procedure is regulated by one document for everyone (Federal Law 129-FZ “On Registration of Legal Entities”).
4. The legal status in our country of citizens of other states is regulated by Federal Law 115-FZ “On the legal status of foreign citizens in the Russian Federation”.
Features of opening an LLC by a foreign founder
Foreign investment– investment of foreign capital in an object of entrepreneurial activity on the territory of the Russian Federation in the form of objects of civil rights (Article 2 of Federal Law No. 160);
Foreign individuals and legal entities have the right to make foreign investments in the Russian Federation.
Foreign investor-individual has 2 reasons to use his right:
- Citizenship;
- Residence permit or temporary residence permit.
If a foreign investor-individual is registered in the Russian Federation as an individual entrepreneur, then his activities will be subject to the law of the Russian Federation (Article 1201 of the Civil Code of the Russian Federation) with the exception of those positions that are determined by his personal status (Article 1196 of the Civil Code of the Russian Federation).
Foreign investor-legal entity can carry out investment activities on the territory of the Russian Federation as a branch, representative office, established company in the form of direct and portfolio investments.
Foreign direct investment(gaining control):
- acquisition by a foreign investor of at least 10% of a share, shares (contribution) in the authorized (share) capital of a commercial organization created or newly created on the territory of the Russian Federation in the form of a business partnership or company in accordance with the civil legislation of the Russian Federation;
- investment of capital in fixed assets of a branch of a foreign legal entity created on the territory of the Russian Federation;
- financial lease (leasing) of equipment specified in sections XVI and XVII of the Commodity Nomenclature of Foreign Economic Activity of the CIS (CIS FEACN), with a customs value of at least 1 million rubles;
Important! Russian legislation does not recognize the creation of a representative office of a foreign company in Russia or the investment of foreign capital in charitable, religious and other publicly useful non-profit organizations as foreign investment, since their activities are not aimed at making a profit.
Foreign portfolio investments(receiving income):
- Acquisition of shares of enterprises in an amount that does not give the right to control their activities;
- Purchase of bonds and government securities;
- Participation in the activities of monetary and financial organizations with international capital.
Branch of a foreign legal entity created on the territory of the Russian Federation must perform part or all of the functions on behalf of the parent organization that created it, provided that the purposes of the creation and activities of the parent organization are of a commercial nature.
Representation of a foreign legal entity, opened on the territory of the Russian Federation, in contrast to a branch, performs exclusively the functions of representing the interests of this foreign legal entity in the territory of the Russian Federation, and, if necessary, protecting the business interests of a foreign company in Russia.
To obtain the right to carry out business activities in Russia, a branch/representative office of a foreign company must obtain accreditation from the State Registration Chamber under the Ministry of Justice of the Russian Federation. Government duty for accreditation of a branch/representative office of a foreign company in Russia is 120,000 rubles.(Clause 5 of Article 333.33 of the Tax Code of the Russian Federation), and the approximate term for obtaining accreditation - from 2 months. For the purpose of accreditation, the parent organization must approve and send to the Chamber a regulation on the branch/representative office, which must indicate basic information about the branch/representative office and its parent organization (name, address, legal form of the company), the purposes of creation and types of activities of the branch/representative office , composition, volume and timing of capital investment in its fixed assets, management procedure (Federal Law 160-FZ “On Foreign Investments in the Russian Federation”).
commercial organization receives the status of a commercial organization with foreign investment from the day a foreign investor joins its members. From this day on, a commercial organization with foreign investment and a foreign investor enjoy legal protection, guarantees and benefits established by law. The specified guarantees and benefits, however, do not apply to subsidiaries and dependent companies of a commercial organization with foreign investments (Article 4 of the Law on Foreign Investments in the Russian Federation).
Attention! A commercial organization with foreign investments may be denied state registration, and a branch of a foreign entity may be denied accreditation in order to protect the foundations of the constitutional system, morality, health, rights and legitimate interests of other persons, ensuring the defense of the country and state security (Articles 20, 21 of the Law on foreign investment in the Russian Federation).
Russian legislation establishes restrictions for the participation of foreign investors in the capital of Russian commercial organizations in the field of television broadcasting, aviation industry, insurance and banking. Benefits are provided, for example, exemption from customs duties when a foreign investor imports equipment and other fixed assets into the territory of Russia as a contribution to the authorized capital of a commercial organization with foreign investment. On dividends, non-residents pay tax at a rate of 15%, while if they have Russian citizenship - 13%. Foreign companies do not have the right to maintain accounting records using a simplified system.
Documents for registering an LLC with a foreign legal entity
Both foreign individuals and legal entities can be participants in an LLC with foreign investment. Depending on this, the set of documents for registering an LLC will differ (see table).
| A (Apostilled), P (notarized translation into Russian) | ||
| № | Individual | Entity |
| 1 | The founder's decision to create | The founders' decision to create P. |
| 2 | Application for LLC registration | Application for LLC registration |
| 3 | Charter | Charter |
| 4 | Receipt for payment of state duty | |
| 5 | Founder’s passport + his P | From each non-resident legal entity |
| 6 | Certificate of registration - AP | |
| 7 | Extract from the trade register (at least 30 days old as of the date of registration of the new company) - AP | |
| 8 | Charter - P | |
| 9 | A document confirming the authority of the head of a foreign legal entity - P | |
| 10 | Passport of the head of a non-resident legal entity + his P | |
| 11 | Establishment agreement (founding agreement) - if available | |
| 12 | A document confirming tax registration of a foreign legal entity - P | |
| 13 | Seal of the Society | |
Some documents (marked with the letter "A") require legalization: either notarization with translation into Russian, or apostille, or both. Depends on whether certain agreements exist between Russia and the country:
Belarus, Lithuania, Latvia and other states that have concluded Treaties on International Legalization - Notarization of documents;
States that have accepted the Hague Convention - Documents certified by apostille;
Other - Legalization at the Russian consulate on the territory of your country.
Registration of a company with a foreign founder: preparation and submission of documents
| № | Stages | Term | Price | |
| 1 | Free consultation on the registration procedure, taxation (name, rent, taxes, types of activities, bank, accounting); | on the day of treatment | on | |
| 2 | Collection of documents by a foreign founder; | self | ||
| 3 | Search for a legal address using a non-standard application; | 0-5 days | 50% of the rental price | |
| 4 | Filling out an application for registration of an LLC with a foreign participant (request an application in feedback or fill it out on the website); | on the day of treatment | on | |
| 5 | Development of a non-standard Charter and Establishment Agreement | 0-5 days | agreement | |
| 6 | Conclusion of a lease agreement for a legal address | 11 months | from 24 t.r. | |
| 7 | Preparation, approval and signing of a package of documents for the creation of an LLC (OKVED, application, standard charter, establishment agreement, decision-protocol); | on the day of treatment | agreement | |
| 8 | Payment of state duty; | on the day of treatment | 4 t.r. | |
| 9 | Certification of the applicant's signature by a notary (personal appearance of the founders of the legal entity). Preparation of a power of attorney for the representative to submit and receive documents; | on the day of treatment | from 2 t.r. | |
| 10 | Submission and receipt of documents | 2-5 days | on | |
| 11 | Registration with funds | upon registration | on | |
| 12 | Conclusion of an accounting service agreement | 12 months | from 10 t.r. |
The presence of founders in the Russian Federation is necessary in practice.
When registering a limited liability company in the Russian Federation, an application for state registration of a legal entity upon creation is submitted to the registering authority; the application must be signed by all founders of the legal entity, the authenticity of the signature must be certified by a notary. During state registration of a legal entity upon creation, the following individuals may be applicants:
- founder (founders) of a legal entity upon its creation;
- the head of a legal entity acting as the founder of a registered legal entity;
Important! The legislation of the Russian Federation does not allow the possibility of signing an application for state registration of a legal entity when created by a person acting on the basis of a power of attorney. The founder of the company or the head of the foreign legal entity - the founder of the LLC - must appear in person before the notary.
The decision to create an LLC can be signed by a person acting on the basis of a duly executed power of attorney. An application for state registration of a legal entity can be submitted to the registration authority by proxy; a certificate of state registration of a legal entity and the constituent documents of the company can also be received by a representative by proxy.
If a foreign founder cannot come to the Russian Federation to register an LLC
There are several theoretically possible ways to solve this problem:
A. Certification of an application for state registration at a consular office. Notarial actions on behalf of the Russian Federation on the territory of other states are performed by officials of consular offices of the Russian Federation authorized to perform these actions (Article 1 of the Fundamentals of the Legislation of the Russian Federation on Notaries). As practice shows, it is necessary to clarify the possibility of such certification of the authenticity of the founder’s signature at each specific consulate. In some cases, they refer to conventions according to which “..a consular officer has the right to certify the signatures of citizens of the sending state,” which means that the consulate can only certify the authenticity of a signature of a Russian citizen.
b. Certification of the application by a foreign notary followed by translation and apostille. An application for state registration of an LLC of a foreign legal entity is filled out in Russian, after which it is completely translated into a foreign language. The applicant's signature on the translated application is certified by a foreign notary, and an apostille is affixed to it. The translation is certified by a Russian notary with the participation of a professional translator, and the document is submitted to the Federal Tax Service. In practice, state registration may be refused on formal grounds, which can be appealed in court with a high probability of success. A similar option is to call a Russian notary to certify documents.
V. Registration of an LLC with a citizen of the Russian Federation with subsequent replacement by foreigners
In practice, our clients still prefer to personally participate in company registration.
Is it required to register an LLC with a non-resident?
We will prepare documents, find an address, and quickly register
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Registration of an LLC by a foreigner on the territory of our country is regulated by the Federal Law “On State Registration of Legal Entities”. According to this document, any citizen of the country, as well as non-resident (foreigner), has the right to register an LLC in the Russian Federation.
Can a foreigner register an LLC?
Surely you go to the market for groceries. And you often meet sellers there - citizens of foreign countries. For some time now they have been obliged to hire Russians as salespeople. This led to the need to obtain legal status: either .
In essence, the rights and obligations of a foreigner are no different from citizens of the Russian Federation during registration. This could even be a stateless person (that is, a person who renounced the citizenship of one state and did not have time to accept another). A person’s ability to work, earn money, and pay taxes on what he earns does not disappear in its absence. However, there are some peculiarities regarding the process of registering an LLC with a foreign founder.
Legality of a person’s presence in Russia
All the talk about how difficult it is for our citizens to obtain a visa at the embassies of different countries pales in comparison to the reality that awaits our foreign colleagues at Russian consulates. The Russian Federation, oddly enough, is still one of the countries for which it is extremely difficult to obtain an entry visa. We will not go into details about the political background of this incident, but the fact remains: in order to live and work with us, a foreign citizen needs to show remarkable patience (companies that provide services for “expedited” registration and obtaining migration registrations and permits for work).
In other words, a foreign citizen is required to have a permit that allows him to be on the territory of the Russian Federation, live and work here. This document is a visa, unless otherwise provided by a diplomatic treaty between countries.
In Russia in Russian
All documents for registering a company with a foreign founder must be prepared in Russian. Copies of identification documents (passport, residence permit), if necessary, must be translated into Russian and certified by a notary (apostilled).
It would not be amiss to note that citizens of other states must have a work permit (WWP) on the territory of the Russian Federation issued by the migration department. According to the new rules, the following incident may occur here. To obtain a PNR, a citizen must submit an application from the enterprise for which he plans to get a job. It is clear that before registering an LLC, no one will be able to submit such an application (due to lack of a place of work). Until the last moment, the tax authorities turned a blind eye to the absence of such a document. But after the introduction at the end of last year of a requirement for all applicants to pass a Russian language exam, this may become a problem. And not at all because a foreigner may not know the language. But because of bureaucratic delays. So far no official papers have been published on this matter, so we are working the old fashioned way.
"Current issues of accounting and taxation", 2008, N 14
In the last issue of the magazine, we started a conversation about the peculiarities of taxation in organizations with foreign investment. Today is a continuation of the topic we started.
Income tax
The procedure for calculating income tax for organizations whose founders (participants) include foreigners also has its own characteristics.
Increasing the share of authorized capital
An increase in the authorized capital is possible not only due to additional contributions from participants, but also due to retained earnings. In this case, the size of the share of the non-resident participant increases in proportion to the share that previously belonged to him, and the foreign founder does not generate income (Letter of the Federal Tax Service for Moscow dated June 30, 2005 N 20-12/46422). In the event that a non-resident participant sells a share in the management company of an LLC, income from the sale of such share is subject to taxation at the source of payment in accordance with paragraphs. 5 p. 1 art. 309 of the Tax Code of the Russian Federation, provided that more than 50% of the LLC’s assets consist of real estate located on the territory of the Russian Federation.
When determining the tax base, expenses may be deducted from the amount of taxable income in the manner prescribed by Art. Art. 268 and 280 of the Tax Code of the Russian Federation (clause 4 of Article 309 of the Tax Code of the Russian Federation), if these expenses are documented, in other words, if by the date of payment of the specified income the foreign organization has provided the tax agent with the relevant data on such expenses.
If the share of Russian real estate in the organization’s assets does not exceed 50%, then the income in question does not relate to income received from sources in the Russian Federation, and the organization acquiring a share in the management company is not a tax agent.
Depreciation deductions
To calculate depreciation charges, included in expenses when determining the tax base for income tax, for property received as a contribution to the capital company, its assessment is necessary in order to confirm the original cost.
Note. If the receiving party cannot document the value of the contributed property or any part of it, then the value of this property or its part for profit tax purposes is recognized as zero (clause 1 of Article 277 of the Tax Code of the Russian Federation).
In the case where the founders are foreigners, a special procedure for such assessment has been established (paragraph 4, paragraph 2, paragraph 1, article 277 of the Tax Code of the Russian Federation). According to this procedure, the receiving party forms the initial cost of the property based on documented expenses for its acquisition (creation), taking into account depreciation (wear and tear) accrued according to the rules of the state of which the transferring party is a tax resident. In this case, the initial (residual) value cannot be higher than the market value of the property, confirmed by an independent appraiser acting in accordance with the legislation of the specified state.
But what if there is no institute of independent appraisers on the territory of the state of which the foreign founder is a resident? Then, according to the Ministry of Finance, an independent property appraiser can be a full member of any foreign association of professional appraisers who evaluates property in accordance with International Valuation Standards with an international appraiser certificate (Letter dated August 14, 2007 N 03-03-05/219). In the Letter, financiers also note that confirmation of the initial cost of property received from a foreign founder is a right, not an obligation, of the taxpayer.
In this regard, the question arises about the form of documents confirming the market value of the property. The Letter of the Ministry of Finance of Russia dated September 12, 2007 N 03-03-07/17 explains that such documents may be documents in the form established by the internal legislation of the relevant foreign state or the International Valuation Standards, since the Tax Code of the Russian Federation does not provide for a mandatory form of documents to confirm market value property. If this document is drawn up in a foreign language, its translation into Russian must be made by a certified translator and notarized. Financiers pay attention to the fact that this document may be requested by the tax authority when conducting control work to verify the organization’s compliance with the norms of the legislation of the Russian Federation on taxes and fees.
Interest on loans
Financing of Russian commercial organizations with foreign investment can be carried out using borrowed funds from the founders. In the case where the lenders or guarantors are the founders - foreign companies that own more than 20% of the capital of a Russian organization, the debt on debt obligations for profit tax purposes is considered controlled<1>. This means that organizations that have an outstanding controlled debt on a debt obligation at the end of the reporting (tax) period apply special rules for calculating the maximum interest taken into account for profit tax purposes (clauses 2 - 4 of Article 269 of the Tax Code of the Russian Federation). Let's list them.
<1>Read more in the article by E.E. Smirnova “All about controlled debt”, published in the magazine for 2007, N 24.
Firstly, the organization is obliged, on the last day of each reporting (tax) period, to calculate the maximum amount of interest recognized as expense on controlled debt by dividing the amount of interest accrued in this period on controlled debt by the capitalization ratio calculated as of the last reporting date of the corresponding reporting (tax) period. ) period (paragraph 2, paragraph 2, article 269 of the Tax Code of the Russian Federation). In this case, the capitalization ratio is determined by dividing the amount of outstanding controlled debt by the amount of equity capital corresponding to the share of direct or indirect participation of a foreign company in the capital of a Russian organization, and dividing the result by 3 or 12.5 - for banks, as well as for organizations engaged exclusively in leasing activities (paragraph 3, paragraph 2, article 269 of the Tax Code of the Russian Federation).
To calculate the capitalization rate, you can use the following formula:
CC = NKZ / SK / D / 3 (or 12.5),
where CC is the capitalization ratio;
NKZ - the amount of outstanding controlled debt;
SK - the amount of equity capital of the borrowing organization;
D - the share of participation of a foreign person in the activities of the borrowing organization.
Secondly, the expenses include interest on controlled debt, calculated according to special rules, but not more than the actual accrued interest. The positive difference between the amount of interest accrued on debt obligations during the reporting period and their maximum amount, which can be included in tax expenses, is equal to dividends paid to a foreign organization and is subject to income tax at the source of payments at a rate of 15% in accordance with paragraph 3 of Art. . 284 Tax Code of the Russian Federation.
Thirdly, this procedure must be followed subject to compliance with a specific condition - a threefold excess of the amount of controlled debt over the amount of the borrower’s equity, determined as of the last date of the reporting (tax) period. If this requirement is not met, then interest is accrued in the general manner using one of the methods specified in clause 1 of Art. 269 Tax Code of the Russian Federation:
- on comparable terms from the average level of interest charged on debt obligations issued in the same quarter (month - when calculating monthly advance payments of income tax);
- in an amount equal to the refinancing rate of the Central Bank of the Russian Federation, increased by 1.1 times - when issuing a debt obligation in rubles and equal to 15% - for debt obligations in foreign currency.
The general procedure also applies in cases where the share participation of a foreign company in the management company is less than 20% or the founder, a foreign citizen, acts as a lender or guarantor.
Dividends
From 01/01/2008, when paying dividends to the founder (participant) of an organization - a foreign citizen, a personal income tax rate of 15% is applied, in contrast to the previously valid rate of 30% (clause 3 of article 275, clause 3 of article 224 of the Tax Code of the Russian Federation) , provided that otherwise is not established by international treaties between the Russian Federation and a foreign state whose resident is the founder, since the rules and norms of the international treaty have priority (Article 7 of the Tax Code of the Russian Federation, Letter of the Ministry of Finance of Russia dated 05/07/2008 N 03-08-05) .
For information: in the Information message dated 03/02/2004, the Ministry of Finance listed 66 existing agreements with foreign countries on the avoidance of double taxation of income and property as of January 1, 2004 (see also Letter of the Ministry of Taxes of Russia dated 03/04/2004 N 23-1-10 /34-772).
The tax on income in the form of dividends received by the founder - a foreign organization from sources in the Russian Federation, is calculated at a rate of 15% (clause 3, paragraph 3, article 284 of the Tax Code of the Russian Federation), if (as in the case of payment of dividends to the founder - a foreign citizen) between The Russian Federation and the state of which the foreign organization is a resident have concluded an international agreement on the avoidance of double taxation. If the latter has established a reduced tax rate, then it is used when calculating income tax. And if an international agreement stipulates that the income received is not taxed, then the organization does not have the obligation to withhold tax on dividends paid.
However, in order to apply a tax rate different from the generally established one (15%), the tax agent must obtain confirmation from the foreign organization that it has a permanent location in the state with which the Russian Federation has concluded an international agreement regulating taxation issues. This document must be certified by the competent authority of the relevant foreign state, and if it is drawn up in a foreign language, the tax agent is also provided with a translation into Russian (clause 1 of Article 312 of the Tax Code of the Russian Federation).
It should be noted that the Tax Code does not disclose the concept of a competent authority, nor does it establish the form of a document confirming the permanent location of a foreign organization, which leads to tax disputes due to different interpretations of which document is considered confirming (Resolution of the Federal Antimonopoly Service of the North-Western Territory dated 01/09/2008 N A56 -2953/2007, dated 01.08.2007 N A56-44015/2006).
Please note: clause 1 of Art. 310 of the Tax Code of the Russian Federation establishes that the amount of tax withheld from the income of foreign organizations is transferred by the tax agent to the federal budget simultaneously with the payment of income either in the currency of payment of this income, or in the currency of the Russian Federation at the official exchange rate of the Central Bank of the Russian Federation on the date of transfer of the tax.
Example 1. The authorized capital of Investments LLC is 100 million rubles. The participants of the company are: a Russian organization - the share in the authorized capital is 30%, a foreign company - a 70% share. The location of the foreign organization is the Republic of Finland (corresponding confirmation of this was received by the Russian organization).
At the general meeting of participants, which took place on May 26, 2008, it was decided to pay dividends for 2007 in the amount of 10 million rubles, including:
- Russian organization - 3 million rubles. (RUB 10 million x 30%);
- foreign company - 7 million rubles. (RUB 10 million x 70%).
Payments were made on 06/09/2008, the US dollar exchange rate against the Russian currency on this date was 23.5651 rubles.
Investments LLC, when paying dividends to a foreign founder, withholds income tax at a reduced rate of 5% in accordance with Art. 10 Agreement between the Government of the Russian Federation and the Government of the Republic of Finland on the avoidance of double taxation in relation to taxes on income dated 05/04/1996, since the foreign organization fulfills the condition on the amount of invested authorized capital - more than 100 thousand US dollars or its equivalent in the national currencies of the contracting states at the time of accrual and payment of dividends. In the example, the size of the share of the authorized capital of the foreign founder is 70 million rubles. (100 million x 70%), which significantly exceeds 100 thousand US dollars at the time of payment of dividends (23.5651 rubles x 100 thousand US dollars).
Thus, the amount of income tax subject to withholding when paid to a foreign founder will be 350 thousand rubles. (7 million rubles x 5%), accordingly, the foreign founder will be paid 6,650 thousand rubles. (7 million rubles - 350 thousand rubles).
It should be noted that if a Russian organization does not have official confirmation on the date of payment of dividends about the location of the foreign founder in a country with which a double taxation agreement has been signed, the generally established income tax rate of 15% is applied. At the same time, in the future, if the necessary documents are available<2>, a foreign founder may return the amount of tax overpaid to the budget in the manner provided for in Art. 78 Tax Code of the Russian Federation.
<2>The application must be accompanied by documents, the list of which is given in paragraph 2 of Art. 312 of the Tax Code of the Russian Federation.
Are IFRS expenses legal?
When forming the taxable base for income tax, a Russian organization with foreign investments may have a question about the legality of including expenses for audit services prepared in accordance with international reporting standards as expenses that reduce the tax base for income tax. This is what the Ministry of Finance answered this question in Letters dated 06.06.2008 N 03-03-06/2/66, dated 14.01.2008 N 03-03-06/1/6, dated 25.09.2007 N 03-03-06/ 1/695 and dated 12/18/2007 N 03-03-06/1/871.
Costs for audit services in accordance with IFRS are included in other expenses associated with production and sales if taxpayers are required to submit financial statements in accordance with IFRS (clause 17, clause 1, article 264 of the Tax Code of the Russian Federation).
For taxpayers for whom such an obligation is not provided, these costs are not taken into account as part of the audit costs. At the same time, the list of other costs associated with production and sales, contained in Art. 264 of the Tax Code of the Russian Federation is open, and an organization can include the costs of preparing reports under IFRS for profit tax purposes as part of other expenses if these costs meet the requirements of Art. 252 of the Tax Code of the Russian Federation in terms of economic feasibility. As an example, financiers cited a situation (see Letter N 03-03-06/1/695) when an organization prepares IFRS statements for transmission to a shareholder preparing consolidated IFRS statements. In this case, the cost of services both for the preparation of these reports and for their audit can be legally taken into account as part of other expenses on the basis of paragraphs. 49 clause 1 art. 264 Tax Code of the Russian Federation.
Similar conclusions are contained in Resolutions dated January 18, 2008 N A55-5316/07, dated November 29, 2007 N A55-3597/07, in which the FAS PA made a decision in favor of a Russian company with foreign participation, which reduced the tax base for income tax on expenses for the preparation of financial statements in accordance with IFRS and its audit carried out in connection with the requirements of foreign shareholders for the purpose of drawing up consolidated financial statements. The court noted that the Tax Code of the Russian Federation does not contain any restrictions regarding the types of audits, the costs of which may or may not be taken into account for tax purposes (clause 17, paragraph 1, Article 264 of the Tax Code of the Russian Federation). There are no such restrictions in the Federal Law of August 7, 2001 N 119-FZ “On Auditing Activities”, in which the purpose of the audit is characterized as expressing an opinion on the reliability of the financial (accounting) statements of the audited entities. Thus, when determining the possibility of taking into account the costs of an audit, the organization does not establish what type of audit should be carried out (subject to the requirements of Article 252 of the Tax Code of the Russian Federation).
Is the help of a foreigner free of charge?
Often, foreign founders provide free assistance to the organization by transferring funds to its accounts. This is done both for a specific purpose and simply to replenish working capital. What is the procedure for accounting for profit tax purposes of funds in this case? Let's turn to the Tax Code of the Russian Federation.
Based on clause 8 of Art. 250 of the Tax Code of the Russian Federation, income in the form of property received free of charge, regardless of whether it was transferred by a legal entity or an individual, with the exception of the property specified in Art. 251 of the Tax Code of the Russian Federation, for tax purposes, profits refer to non-operating income that forms the tax base of the reporting (tax) period for calculating tax.
In particular, in paragraphs. 11 clause 1 art. 251 of the Tax Code of the Russian Federation establishes that when taxing the profits of organizations, income in the form of property received free of charge by a Russian organization from a company is not taken into account if the capital of the receiving party consists of more than 50% of the contribution (share) of the transferring company.
Thus, funds (as well as other property) received free of charge by the company from a foreign founder with a participation share of more than 50% are not taken into account for profit tax purposes (Letter of the Ministry of Finance of Russia dated April 2, 2008 N 03-03-06/1/ 252).
Note. Documents confirming the receipt by the company of income excluded for the purposes of their tax accounting are the constituent documents of the company, agreements concluded with a foreign organization, payment documents (Letter of the Federal Tax Service for Moscow dated October 10, 2007 N 20-12/096580).
Personal income tax
The question arises: will bonuses paid to employees on behalf of a foreign founder and at the expense of funds transferred free of charge by him be considered income received from sources in the Russian Federation for the purpose of calculating personal income tax? Will the Russian organization act as a tax agent when paying this income? What personal income tax rate should be applied?
It should be said that the procedure for calculating personal income tax does not depend on the source of funds from which payments to employees are made. Thus, the amount of bonuses paid to employees on behalf of a foreign founder organization is recognized as income of an individual received from a Russian organization, subject to personal income tax at a tax rate of 13% (Letter of the Ministry of Finance of Russia dated April 21, 2008 N 03-04-06-01/ 97).
Unified social tax
As for the calculation of the Unified Social Tax, there are some nuances for organizations operating in the field of information technology. In paragraph 6 of Art. 241 of the Tax Code of the Russian Federation, reduced UST rates and a special regressive scale are established for them.
How does this relate to our question? The fact is that one of the conditions that gives such organizations the right to apply reduced UST rates is receiving income from foreign entities. At the same time, the Tax Code of the Russian Federation does not say that these purchasers cannot be foreign founders.
Thus, if a foreign founder is at the same time a buyer of information products of a Russian organization, the share of revenues of which is at least 70% of the total proceeds from the sale of these products, then if the conditions listed in clause 8 of Art. 241 of the Tax Code of the Russian Federation, an organization operating in the field of information technology can apply reduced rates under the Unified Social Tax:
- 26% - with a tax base for each individual on an accrual basis from the beginning of the year up to 75,000 rubles;
- 19,500 + 10% of the amount exceeding 75,000 rubles, with a tax base from 75,001 to 600,000 rubles;
- 72,000 + 2% of the amount exceeding 600,000 rubles, with a tax base over 600,001 rubles.
In addition, based on the clarifications of the Ministry of Finance, taxpayers applying reduced rates with a tax base of 150,000 rubles. the amount of the unified social tax accrued to the federal budget according to a special scale of tax rates is equal to 20,925 rubles, that is, it is less than the tax deduction in the form of the amount of insurance contributions for compulsory pension insurance, amounting to 21,000 rubles. In this case, the amount of UST payable to the federal budget will be zero. Such clarifications were given by the Ministry of Finance in Letters dated May 28, 2007 N 03-04-07-02/18, dated December 25, 2006 N 03-05-02-03/41. In other words, in organizations operating in the field of information technology, with a tax base of over 150,000 rubles. For one person, the unified social tax is not paid to the budget.
Conclusion
To summarize the above, we note: taxation specifics in organizations with foreign investments certainly exist, but Russian legislation does not provide for any special requirements for tax accounting. The calculation of taxes and fees in such organizations is carried out in accordance with the norms of the Tax Code of the Russian Federation and international agreements of the Russian Federation, which include certain provisions regarding the procedure for taxation of organizations and foreign founders.
E.E.Smirnova
Magazine editor
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Registration of an LLC with a foreign founder is carried out in the manner prescribed by the current norms of civil legislation. According to the norms of the Civil Code of the Russian Federation, foreign citizens, as well as Russian citizens, have the full right to carry out business activities within the territory of the Russian Federation.
Note! Despite the unified procedure for registering an LLC, provided for both Russian and foreign founders, some differences still exist.
Thus, a company whose participants are foreigners will be called not just an LLC, but an LLC with foreign investments. In addition, foreign businessmen will have to face some taxation pitfalls and restrictions on activities. Otherwise, there are no significant differences: the same procedure, almost the same package of documents and requirements for entrepreneurs.
The article provides information on how to register an LLC with a foreign founder and what documents will need to be prepared. This information will help you understand the intricacies of the procedure in more detail, thus avoiding the likely difficulties that a foreign businessman may encounter during registration.
Why LLC
A limited liability company is the most profitable form of organizing business activities for representatives of medium-sized businesses. LLC has the status of a legal entity and a lot of advantages. An obvious and indisputable advantage of this organizational and legal form is the fact that its founders are liable for the debts of the company only within the limits of their shares, that is, even in the event of bankruptcy of the organization, the personal property of its founders will not be affected. This feature favorably distinguishes a company from an individual entrepreneur, who can pay with all his property for failure to fulfill obligations.
In addition, LLCs, especially those that operate under the general taxation system, are more attractive to large companies, so they have more opportunities to establish business relationships with serious business partners.
What a foreign businessman needs to know about LLC and its registration:
- the founders of an LLC with foreign investment can be not only legal entities, but also individuals;
- if the founders of the company are only foreigners, it will be an LLC with foreign investments, but if both foreign and Russian businessmen or organizations took part in the formation of the authorized capital, it will be an LLC with equity investments;
- In addition to the main package of documents, the foreign founder will have to prepare additional materials necessary to implement the procedure.
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Restrictions for foreign founders
Although the procedure for registering an LLC with a foreign founder is practically no different from registering an LLC by Russian citizens, the law still provides for some restrictions for foreign businessmen. These restrictions apply to activities.
Thus, an LLC with a foreign founder/founders cannot:
- provide repair services;
- conduct activities related to the disposal of military equipment;
- work in areas involving the use of radioactive substances;
- carry out activities the implementation of which involves the use of television and radio broadcasts on a large scale;
- engage in publishing with a circulation exceeding 1 million copies;
- participate in the conduct of activities from the insurance or banking industry;
- purchase or lease land plots from the category of port and border areas. There are also some restrictions on agricultural land. Thus, leasing such plots is possible only if foreign investments occupy the majority of the company’s authorized capital. The purchase of such lands is completely prohibited.
In relation to other areas, foreign founders are endowed with the same rights as Russian LLC founders, and organizations with foreign participants can operate in any area not burdened by legislative restrictions.
As for taxation, the procedure and conditions for implementing the procedure are similar to the standard one. The nuances that you should pay attention to include:
- tax on dividends. Dividends from foreign founders, just like domestic ones, are taxed. The difference lies in the amount of the payment. If Russian LLC participants must pay 9% tax, then foreign ones - 15%;
- LLCs with foreign participants are not given the opportunity to switch to a simplified taxation system. As a rule, companies with foreign investments are assigned a general tax system.
Note! The use of OSNO, despite the greater burden compared to other tax regimes, cannot be considered a disadvantage, since organizations operating on a common system are more competitive and attractive to owners of large companies.
Based on the above, we can conclude that the procedure for registering an LLC by non-residents of the Russian Federation does not cause any particular difficulties and does not differ from that used by Russian entrepreneurs. Moreover, at the moment there are many companies providing intermediary services in the field of business registration. With their help, you can register a company with foreign investment in the shortest possible time. The advantage of participating in the registration of companies of this kind is the fact that the founder of the organization does not need to be in the Russian Federation personally.
As practice shows, in some cases the period for preparing registration documents for foreign applicants increases slightly. This is justified by the fact that it takes more time to check the documentation of foreigners.
Free preparation of documents for LLC registration and convenient online accounting are available to you on the “My Business” service.
Foreign founder - individual
According to the law, a participant in an LLC with foreign investment can be either a citizen of another state or an entire foreign organization. A distinctive feature of registering a company by a foreigner is the need to indicate his actual place of residence in his homeland. This information is recorded in the application, the provision of which is required for the implementation of registration actions.
The application form has a unified form (P11001), a sample can be downloaded on the official website of the tax service or obtained from the Federal Tax Service office during a personal visit.
In addition to the application, you need to prepare a package of documents, a detailed list of which is established by Federal Law No. 129, in particular Art. 12 of this regulatory legal act.
According to this norm, a foreign founder who has the status of an individual must submit the following documents to the tax office:
- identification. Any document confirming and identifying the foreign founder can act in this capacity;
- a document confirming the fact of residence of the applicant outside the Russian Federation.
Documents submitted to the registration authority must, first of all, be reliable, and secondly, comply with established requirements. These include:
- documents must be translated, that is, 2 copies must be submitted: the original and the translation;
- presence of an apostille;
- notarized certificate.
Practice shows that it is better to translate materials in Russia. The rule also applies to notarization, since it is almost impossible to find a notary in another country willing to certify documents for submission to government bodies of the Russian Federation.
Registration of an LLC with a legal entity founder
The situation when the founder is a legal entity also has its own characteristics. Thus, an organization is required to provide a document such as an extract from the trade register. The document contains information about the location of the organization in the territory of the country in which it was originally registered.
Like a foreign founder, the organization is required to submit a package of documents, which, in turn, must comply with certain standards. These include:
- presence of a mark on completion of the legalization procedure at the consulate;
- availability of translation and apostille;
- notarized certificate. Only those notaries who have the right to carry out notarial activities on the territory of the Russian Federation have the authority to certify documents of this kind.
Note! The information recorded in the documentation must be reliable and free from errors and inaccuracies. If, when filling out an application, the required data is not in the applicant’s documents, it is better to simply put a dash. Leaving columns empty is not allowed. Information must be entered from copies translated into Russian, and not from the originals.
Package of documents
Registration of an LLC with a foreign individual founder requires the submission of the following documents:
- decision to create an LLC. If there are several founders, according to the law there can be no more than 50 of them, the decision is made at a general meeting by voting and entered into the minutes. If there is only one founder, he makes the decision alone;
- articles of association. The document is fundamental in the activities of the LLC, since it contains information on the size of the authorized capital, distribution of shares, name and legal address of the company. In addition, the charter contains information about the founders of the LLC. Submitted in two copies, one of which is stored at the registration authority, the second is returned to the applicant based on the results of the procedure;
- application in a prescribed format. Mandatory details of the document are the signatures of all LLC participants, the authenticity of which is certified by a notary. There is no need for notarization if each of the founders has his own electronic seal, and the application is submitted using an Internet service;
- fee payment receipt;
- title documents for the premises that will be used while conducting business;
- a document containing information about the applicant’s place of residence in his home country.
Registration of an LLC with a foreign legal entity founder requires the submission of the following documents:
- statutory documents of the organization;
- decision to found an LLC;
- a document certifying that the LLC has a valid legal address;
- a receipt confirming payment of the state duty in the prescribed amount;
- an extract from the trade register containing information about the location of the applicant in the state of its registration.
Procedure for implementing the procedure
Registration of an LLC with foreign capital is carried out after completing the following actions:
- adoption by foreign founders/founder of a decision to create an LLC. Before making a decision, the founders should decide on the name of the future company, its legal address, and areas of activity. In this case, it is necessary to take into account the legal restrictions listed earlier;
- entering the decision into the protocol;
- preparation of necessary documents;
- payment of state duty;