According to the Letter of Minfin and STS on taxation of external bonds in 1997 interest on municipal and regional bonds for which a global certificate for the issue is placed with a depository resident in a country with a double tax treaty with Russia is not subject to withholding tax under the terms of this treaty. In other cases income tax should be withheld by the relevant paying agent, although the bondholder can claim relief if resident in a country with an appropriate double tax treaty.
Letter of the State Tax Service VE-6-36/353 "On taxation of income received from operations with municipal and regional external bonds" of 8 May 1997
Foreign currency accounts of Russian residents
Resident legal entities having foreign currency accounts in Russian authorised banks may open a currency account abroad with a non-resident bank or with a foreign branch of a Russian authorised bank. Such accounts may be used exclusively for payments connected with the activity of the foreign representation (RO). Special permission should be obtained from CBR before an account is opened. Enterprises having bank accounts abroad should report quarterly to the CBR on actual movement of funds on the accounts. The foreign accounts may be used only for current activity of the RO (payment of salaries, rent, bank charges). It is prohibited to use it for commercial purposes.
Regulation on the procedure of issuing permissions for opening and maintaining currency accounts by resident legal entities for payment of expenses related to their foreign representative offices, approved by the Order of the CBR 02-193 of 22 April 1997
Pension Fund contributions by individual entrepreneurs
The Moscow State Tax Inspectorate has confirmed the procedure for calculating Pension fund contributions by individual entrepreneurs under the 'simplified system of taxation'. According to this system, an entrepreneur purchases a licence rather than pays personal income tax. Thus, the cost of the licence being equal to the amount of tax is used to calculate his income which in turn is the base for social contribution calculation. The tax authorities are required to provide spravkas with income calculation to entrepreneurs to file with the Pension fund Moscow local offices.
Letter of 18 March 1997 11-13/5446 by Moscow State Tax Inspectorate
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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4 July 1997