Tax flash reports

Tax legislation amendments

The codification of the unjustified tax benefit from the Russian FTS perspective

The Russian Federal Tax Service (the "FTS") has explained in a letter to territorial tax authorities how the provisions of article 54.1 of the Russian Tax Code (the “RTC”) should be applied. The letter points out that tax authorities may challenge the received tax benefit only if they can confirm that the transaction has not been carried out by a taxpayer’s counterparty and that the taxpayer has failed to meet the conditions allowing them to reduce their tax base or the amount of tax payable (the conditions are set by item 2 of Article 54.1 of the RTC). Furthermore, the FTS calls on tax inspectorates to abandon their formal approach during tax audits when trying to identify taxpayers that are abusing their rights.

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Ekaterina Lazorina
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Tel: +7(495) 967-6370

Yana Zoloeva
Partner, Russia Tax and Legal Leader
Tel: + 7 (495) 967 6152

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