On 31 August 2023, the government of Russia announced new tax rules that will exempt profits of foreign collective investment structures from taxation. The exemption will apply if the following conditions are met:
- The profit of the structure is not subject to tax in its country of residence.
- The structure is a collective investment arrangement that is lawful under its governing law.
- Profits distributed to participants are taxable to controlling persons.
The compliance with these conditions must be stated in the CFC notification (Article 25.14(6)(11) of the Tax Code). These amendments will be effective starting 31 August 2023.
