The Finance Ministry (MoF) has published a Letter No. 52359 for describing the allocation of income and expenses to a Permanent Establishment (PE) in Russia of a non-resident company and it has issued on 17th October 2014. In accordance with article 246 of the tax code, a non-resident having a PE in Russia is counted as a taxpayer. Again, according to article 306 of the Tax Code, a PE includes a branch, representative office, division, bureau, agency, other structural subdivision, or any other place through which a non-resident often carries on business actions in Russia. The MoF also described that under article 307 of the Tax Code, a non-resident doing activities through a PE in Russia must determine the corporate income tax base considering the income derived from performing activities in Russia through the PE and the related expenses that are deductible under the Tax Code. Under article 252 of the Tax Code, expenses are treated as tax deductible, if such costs are economically justified, properly documented, and incurred with the view to obtain taxable income. Also, income allotted to the PE in Russia should be determined considering the functions performed, the assets used and the economic or commercial risks estimated by that PE.
Related Posts

Russia, Myanmar finalize talks on investment protection agreement
Myanmar and Russia issued a joint statement in Moscow announcing the conclusion of negotiations for an investment protection agreement (IPA) 4 March 2025. . Russia and Myanmar finalized the talks on a draft of agreement on encouragement and
Read More
Russia keeps key interest rate at 21%
The Central Bank of Russia (CBR) announced its decision to keep the key rate at 21% on 14 February 2025. Earlier, CBR increased the key interest rate from 19% to 21%, on 25 October 2024. This is the highest key interest rate in Russia since
Read More
Russia, UAE sign new tax treaty
Representatives from Russia and the UAE have signed a new income and capital tax treaty on 17 February 2025 . The treaty will come into effect after the exchange of ratification instruments, and once it is in force, it will replace the limited
Read More
Russia exempts CFC profits from IHC tax base until 2029
Russia’s Ministry of Finance has clarified that international holding companies are not required to include the profits of their controlled foreign companies (CFCs) in their corporate income tax base for tax periods ending before 1 January
Read More
Russia clarifies tax implications of dividends paid in property
Russia's Ministry of Finance has issued guidance Letter No. 03-07-11/121626 on the corporate income tax and VAT implications of dividends distributed in the form of property. The letter confirms that transferring ownership of assets to
Read More
UAE, Russia hold final round of negotiations for DTA
The United Arab Emirates (UAE), represented by the Ministry of Finance, has successfully concluded the final round of negotiations for the Double Taxation Avoidance Agreement (DTA) on income and capital with the Russian Federation. This
Read More