Starting A Business In Russia – Legal Stuff You Should Know. Once you’ve come up with the idea of starting a business in Russia, you need to start reading up on what the customary procedures are in that country. Russia is a country, unlike the United States of America, where things tend to take their time; hence you need to be prepared for any eventuality.
Here are a few things you need to do when starting a business. You should probably use this as a check list, because it has the most important things to do.
Notarize your documents.
Deposit your initial investment capitol in a bank, and get it approved, along with some proof that you deposited it.
Register with the Russian Federal Tax service, at the local level (at first,) for the initial tax registrations.
Inform the Ministry of Taxation of the company bank account, and get their approval, plus a letter of confirmation.
These few steps are the basic stepping stones to setting up your first business in Russia, just like it is starting a business in Europe. Once you’ve done that, you should know a little more about the tax you pay in Russia.
In Russia, you pay many different types of taxes, and you should properly read up on them so as to get a good understanding of the situation before you start working there. The different types of taxes in Russia are:
Russian Income tax for an Individual – this tax is paid by every single citizen in Russia, and the standard rate is 13% for residents. A Russian citizen is ‘one who spends at least 183 days or more in Russia, in each calendar year.’ What is important is that Russian tax is levied on worldwide income. However, as a businessman, you are permitted to make advance payments on this tax, and you are allowed to do so at least 3 times a year.
Russian Corporate tax – This tax also has a standard rate of 24%. Under this category, your profits are taxed, and that is made up of 2 different rates (6.5% Federal tax, and a 17.5% regional tax.) However, smaller companies have the benefit of a simplified tax system – which substitutes profit, property and individual tax plus VAT. The rate under this simplified scheme is 6% of the profit.
There are at least 4 other types of tax in Russia, each of which should be read about carefully. The tax year ends on the 31st of December. As a self employed individual, you are expected to file your returns by the end of April. Any balance due in the tax amount has to be paid by mid July.
So now that you know a little bit about the tax procedure, let us move on to another important legal aspect – Customs.
There are plenty of customs procedures in Russia, but lets go through a few of the prominent ones, that you may have to deal with.
Release for Domestic Consumption: This is a custioms procedure for when you import goods into the territory of Russia. They are also subject to any obligations from the territory from where they are being procured. Once the requisite customs duties, and other fees are paid, the imported merchandise will attain the status of ‘goods’ and will be allowed for free distribution amongst the territory.
Export customs: These customs are basically ones in which goods produced in the Russian territory are exported to other territories, without any obligations of importing them back.
The legal scene in Russia is very strict, so it’s in your best interests to read, follow and obey all the rules and regulations in the country.