Getting income from a source abroad is often associated with the need to pay a "profit" tax under the rules of the local tax legislation. But the mere fact of paying a foreign tax does not exempt a resident of the Russian Federation from the need to pay off the budget of his native state. However, situations where the same income is subject to tax twice do not always arise. With a number of countries, the Russian Federation has agreements on the avoidance of double taxation. These documents provide for the collection of tax only once, and do not double mandatory contributions from income received from foreign economic transactions.

Which countries have an agreement on avoidance of double taxation?

Any income taxes can potentially be “doubled” - personal income tax, income tax, simplified tax on the simplified tax system, if the source of income payment is a foreign payer, and the recipient is a resident of the Russian Federation. Each country has its own laws related to the procedure for calculating taxes. Accordingly, income abroad can be taxed at a variety of rates, regardless of what tax and at what rate the same income may be subject to in Russia.

But, focusing on the method of eliminating double taxation, based on work under the relevant agreement, a company, individual entrepreneur or individual will not pay a double amount of the budget allocation. Of course, if the deal is concluded with a representative of the state in which the Russian Federation has this agreement.

At the moment, the Russian Federation has agreements with such countries as, for example, Belarus, Kazakhstan, Tajikistan, USA, Canada, Germany, France, Israel, Egypt, Japan, China, Australia. In total, as of January 1, 2017, there are 82 such countries with which we have agreements on the elimination of double taxation, and all of them are listed in the relevant information letter of the Ministry of Finance.

Evidence of resident status

The issue of eliminating double taxation is especially relevant, perhaps, in relations with companies from neighboring countries, for example, Kazakhstan and Belarus, since it is with them that Russian business develops in Lately the closest ties. How does it work in practice?

Suppose that a Russian company provides some services to an organization registered in Belarus, with which the Russian Federation has an appropriate agreement on the avoidance of double taxation.

When transferring payment in the described situation, the Belarusian side is obliged by default to withhold from the income of a foreign counterparty in relation to it the amount of tax at a rate of 15% - it is established by the Tax Code of the Republic of Belarus. As a result, the executing company receives income minus the amount of tax, and in this case it does not have to pay the repeated tax in Russia.

But there is another option - to provide the Belarusian counterparty with a certificate of residence in the Russian Federation. In this case, the contracting authority will have confirmation that the executing organization is indeed a Russian company and, therefore, is subject to the agreement. On the basis of such a certificate, the income is transferred in full, without any deductions, and the Russian company will pay the budget in accordance with the Russian Tax Code. Moreover, if such a company operates within the framework of the STS-6%, then paying tax with us is obviously more profitable, and vice versa, if this is a company on a general taxation system with a rate of 20%, the amount of tax will be higher if it is paid to the budget of the Russian Federation .

One way or another, a certificate of residence is a document on the basis of which a foreign partner does not tax the amount of the paid Russian organization income according to the taxes applicable in its territory.

Certificate of confirmation of residence of the Russian Federation

The procedure for confirming the status of a resident of the Russian Federation was approved in the Information Notice of the Federal Tax Service of Russia dated November 23, 2012. Since February 2008, the Interregional inspection Federal Tax Service of Russia for Centralized Data Processing, abbreviated as MI of the Federal Tax Service of Russia for Data Center.

There is no form for requesting confirmation of resident status - its companies, individual entrepreneurs and individuals are drawn up in free form, but with the obligatory indication of the calendar year for which confirmation is required, the name of the foreign state with whose representative there is cooperation, as well as the name and details of the Russian taxpayer itself.

In most cases, a certificate of the established form is issued to confirm the status of a Russian resident. However, depending on which country the domestic company works with, this may also be a form of document approved by a foreign state. In such cases, the form is certified by the signature of the official and the seal of the Russian tax authority.

The procedure itself is quite lengthy. The term for consideration of applications for issuing a confirmation of the status of a resident is 30 calendar days from the date of submission to the MI of the Federal Tax Service of Russia for the data center of the request, as well as additional necessary documents.

A certificate confirming the status of a resident is usually issued for the current calendar year, but it can also be requested for past periods.

Convention between the Government of the Russian Federation and the Government of the French Republic for the Avoidance of Double Taxation and the Prevention of Tax Evasion and Violations

Government Russian Federation and the Government of the French Republic,

Desiring to conclude a Convention for the Avoidance of Double Taxation and the Prevention of Tax Evasion and Violation of Tax Laws in Respect of Taxes on Income and Property,

agreed on the following:

Article 1 Persons to whom the Convention applies

Article 1
Persons to whom the Convention applies

This Convention shall apply to persons who are residents of one or both of the Contracting States.

Article 2 Taxes to which the Convention applies

Article 2
Taxes to which the Convention applies

1. This Convention shall apply to taxes on income and on property levied at all levels in a Contracting State, regardless of the manner in which they are levied.

2. Taxes on income and property are considered to be all taxes levied on the total amount of income, the total value of property or on individual elements of income or property, including taxes on income from the alienation of movable or real estate, taxes on the total amount of wages paid by businesses, and taxes on property gains.

3. The applicable taxes to which this Convention applies are, in particular:

a) in the case of France:

(i) income tax;

(ii) company tax;

(iii) a payroll tax governed by the provisions of the Convention applicable, as the case may be, to business profits or income from independent personal services;

(iv) solidarity tax on wealth;

b) in relation to Russia, taxes levied in accordance with the following laws of the Russian Federation:

(i) "On the tax on profits of enterprises and organizations" (including the tax on excess of the normalized amount of wages);

(ii) "On Personal Income Tax";

(iii) "On corporate property tax";

(iv) "On Personal Property Tax",

(hereinafter referred to as "Russian taxes").

4. This Convention shall also apply to any similar or substantially similar taxes imposed after the date of signature of the Convention in addition to or in lieu of existing taxes. The competent authorities of the Contracting States shall notify each other of significant changes in their respective taxation laws.

Article 3. General definitions

Article 3
General definitions

1. For the purposes of this Convention, unless the context otherwise requires:

a) the term "Contracting State" means, as the context requires, Russia or France;

b) the term "France" means the European and overseas departments of the French Republic, including territorial waters, and beyond them, the areas where, in accordance with international law, the French Republic has sovereign rights with regard to exploration and exploitation natural resources the seabed, its bowels and waters covering it;

c) the term "Russia" means the territory of the Russian Federation and includes its exclusive economic zone and the continental shelf, as defined in accordance with the 1982 United Nations Convention on the Law of the Sea;

d) the term "public institution of a Contracting State" means, in relation to Russia, the bodies of state power established in Russia in accordance with the terms of the Constitution of Russia, and in relation to France, the State itself, its territorial bodies, as well as their legal entities public law;

f) the term "person" includes natural persons, companies and any other body of persons;

f) the term "company" means any legal person or any entity which is treated as a legal person for tax purposes;

g) the term "enterprise of a State" means any form of business carried on by a resident of that State;

h) the term "international traffic" means any transport by a ship or aircraft operated by a resident of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State;

i) the term "competent authority" means:

(i) in the case of France, the Minister responsible for the budget or his authorized representative;

(ii) in the case of Russia, the Ministry of Finance of the Russian Federation or its authorized representative, and, in the application of the provisions of Article 26, the State tax service Russian Federation or its authorized representative.

2. When the Convention is applied at any time by a Contracting State, any term or expression not defined therein shall have the meaning given to it by the law of that State, unless the context otherwise requires. The meaning given to a term or expression by the taxation laws of that State in relation to the taxes to which the Convention applies shall prevail over the meaning given to that term or expression by other branches of the laws of that State.

Article 4. Resident

Article 4
Resident

1. For the purposes of this Convention, the expression "resident of a Contracting State" means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of incorporation, place of management or any other criterion of a similar nature. However, this expression does not include persons liable to tax in that State only in respect of income from sources in that State or in respect of property situated therein.

2. Where, by virtue of the provisions of paragraph 1, an individual is a resident of both Contracting States, his position shall be determined as follows:

a) he shall be deemed to be a resident of the State in which he has his permanent home; if he has a permanent home in both States, he shall be deemed to be a resident of the State in which he has the closest personal and economic ties (centre of vital interests);

b) if the State in which that person has his center of vital interests cannot be determined, or if he has no permanent home in either State, he shall be deemed to be a resident of the State in which he has his habitual residence;

c) if he has his habitual residence in both States, or if he has his habitual residence in neither of them, he shall be deemed to be a resident of the State of which he is a national;

d) if both States consider that person to be their national or if he is not a national of either of them, then the competent authorities of the Contracting States shall settle the matter by mutual agreement.

3. If, by virtue of the provisions of paragraph 1, a person other than an individual is a resident of both Contracting States, then he shall be deemed to be a resident of the State in which his place of effective management is situated.

4. The expression "resident of a Contracting State" includes companies or groups of persons the effective management of which is in that State and whose shareholders, associate members or other members personally are liable to tax on their share of the profits in accordance with the internal laws of that State.

Article 5. Permanent establishment

Article 5
permanent mission

1. For the purposes of this Convention, the term "permanent establishment" means a fixed place of business through which an enterprise of a Contracting State wholly or partly carries on entrepreneurial activity in the other Contracting State.

2. The term "permanent establishment" includes in particular:

a) place of management;

b) branch;

c) an office;

d) factory;

e) workshop and

f) a mine, an oil or gas well, a quarry or any other place where natural resources are extracted.

3. Construction site or the installation site form a permanent establishment only if the duration of such work exceeds 12 months.

4. Regardless of previous provisions this article The term "permanent establishment" is not considered to include:

a) the use of facilities solely for the purpose of storing, displaying or supplying goods belonging to the enterprise;

5. Notwithstanding the provisions of paragraphs and , if a person, other than an agent of an independent status referred to in paragraph 6, is acting on behalf of the enterprise and has and habitually exercises in a Contracting State the power to conclude contracts on behalf of the enterprise, it shall be deemed that that enterprise has a permanent establishment in that State in respect of any business which that person carries on for the enterprise, except to the extent that such person's activities are limited to the activities referred to in paragraph 4 which, even if carried on through a fixed place of business, would not permit treat this fixed place of business as a permanent establishment.

6. An enterprise shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting in the ordinary course of their business.

7. The fact that a company which is a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other State (whether through a permanent establishment or otherwise), shall itself does not by itself make one of these companies a permanent establishment of the other.

Article 6. Income from real estate

Article 6
Income from real estate

1. Income derived from immovable property (including income from agriculture and forestry) situated in a Contracting State shall be taxed in that State.

2. The term "immovable property" has the meaning given to it by the laws of the Contracting State in which the property is situated. This term in any case includes property ancillary to real property, livestock and equipment used in agriculture and forestry, rights to which the provisions of private law apply in relation to land ownership, rights known as usufruct of immovable property, and rights to variable or fixed payments in compensation for exploitation or the right to develop mineral reserves, springs and other natural resources; sea, river and aircraft are not considered as immovable property.

3. The provisions of paragraph 1 apply to income derived from direct use, leasing or any other form of use of immovable property.

4. The provisions of paragraphs 1 and 1 also apply to income from the real estate of an undertaking and to income from real estate used for the performance of independent personal services.

5. Where shares, shares or other rights in a company or body corporate entitle the use of immovable property situated in a Contracting State and owned by that company or body corporate, income derived from the direct use, leasing or use in any other form of such rights of use may be taxed in that State notwithstanding the provisions of Articles 7 and .

Article 7. Profit from entrepreneurial activity

Article 7
Business profit

1. The profits of an enterprise of a Contracting State shall be taxable only in that State, unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If an enterprise carries on business in this way, the profits of the enterprise may be taxed in the other State, but only so much as is attributable to that permanent establishment.

2. Subject to the provisions of paragraph 3, if an enterprise of a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, then in each Contracting State that permanent establishment shall include the profit which it would have received had it been a separate and a separate enterprise engaged in the same or similar activities under the same or similar conditions, and operated entirely independently of the enterprise of which it is a permanent establishment.

3. In determining the profits of a permanent establishment, deductions must be made for expenses incurred for the purposes of that permanent establishment, including management and general administrative expenses, whether such expenses are incurred in the State in which the permanent establishment is situated or outside it.

4. No profit is attributable to a permanent establishment based solely on its purchase of goods for the enterprise.

5. For the purposes of the preceding paragraphs, the profit attributable to a permanent establishment is determined annually by the same method, unless there is good and sufficient reason for changing it.

6. Where profits include types of income referred to separately in other Articles of the Convention, the provisions of those Articles shall not be affected by the provisions of this Article.

Article 8. Profit from international transport

Article 8
Profit from international transportation

1. Profits which an enterprise of a Contracting State derives from the operation of ships or aircraft in international traffic shall be taxable only in that State.

2. The profit referred to in paragraph 1 includes the profit that the undertaking derives from other activities and in particular from the use, maintenance or rental of containers for the carriage of goods in international transport, provided that this activity is ancillary operation referred to in the same paragraph.

3. The provisions of paragraphs 1 and also apply to profits from participation in a pool, joint venture or international motor vehicle organization.

Article 9 Profit adjustment

Article 9
Profit Adjustment

a) an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or

b) the same persons participate directly or indirectly in the management, control or capital of an enterprise of one Contracting State and an enterprise of the other Contracting State, and in each case the two enterprises are bound in their commercial or financial relations by mutually agreed or prescribed terms and conditions other than those that would take place between two independent enterprises, then any profit that, without these conditions, could be credited to one of them, but due to the presence of these conditions was not credited to him, may be included in the profit of this enterprise and, accordingly, taxed tax.

2. Where a Contracting State includes in the profits of an enterprise of that State (and taxes accordingly) profits in respect of which an enterprise of the other Contracting State has been taxed in that other State, and if the profit so included is profit which would have been credited to an enterprise of the first-mentioned State, if the relations between the two enterprises were the same as between independent enterprises, then that other State shall make an appropriate adjustment in its taxation on those profits, if that other State considers such an adjustment justified. In determining such adjustment, due regard shall be had to the other provisions of this Convention, and the competent authorities of the Contracting States shall, if necessary, consult each other.

Article 10. Dividends

Article 10
Dividends

1. Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State.

2. However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident and according to the laws of that State, but if the beneficial owner is a resident of the other Contracting State, the tax so charged may not exceed:

a) 5 percent of the gross amount of dividends:

(i) if that beneficial owner is a company that has made an investment in the company paying the dividend, regardless of the form or type of that investment, with a total value of at least 500,000 French francs or its equivalent in another currency, each investment being valued at the date of its implementation; And

(ii) where that beneficial owner is a company which is liable to tax on profits under the common law regime provided for by the taxation laws of the Contracting State of which it is a resident and which is exempt from such tax in respect of those dividends;

b) 10 percent of the gross amount of the dividend if only conditions (i) of subparagraph a) or only conditions (ii) of subparagraph a) are met;

c) 15 per cent of the gross amount of dividends in all other cases.

The provisions of this paragraph do not affect the taxation of the company in respect of the profits out of which dividends are paid.

3. The term "dividends" as used in this Article means income from shares or other shares, other than debt claims, and income which is subject to the taxation of any participation income under the taxation laws of the State of which the company paying the dividend is a resident. dividends. This term does not include the income referred to in Article 16.

4. The provisions of paragraphs 1 and 1 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, carries on, in the other Contracting State of which the company paying the dividends is a resident, an industrial or commercial activity, through a permanent establishment situated therein, or exercises in that other State independent personal services from a fixed base located there, and the participation in respect of which the dividend is paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14 shall apply.

5. Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not levy any tax on dividends paid by that company, unless such dividends are paid to a resident of that other State, or if the participation in respect of which the dividends are paid is effectively connected with a permanent establishment or fixed base situated in that other State and no withholding tax is charged on the retained earnings of the company, even if the dividends paid or retained earnings consist wholly or partly of profits or income arising in that other State.

Article 11. Interest

Article 11
Interest

1. Interest arising in a Contracting State and paid to a resident of the other Contracting State shall be taxable only in that other State if such resident is the beneficial owner.

2. The term "interest" as used in this article means income from debt-claims of any kind, regardless of mortgage security and regardless of ownership of the right to participate in the profits of the debtor, and in particular, income from government securities and bonds loans, including premiums and winnings on these securities. For the purposes of this article, penalties for late payments shall not be treated as interest. The term "interest" does not include elements of income that are treated as dividends under the provisions of Article 10.

3. The provisions of paragraph 1 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, carries on in the other Contracting State in which the interest arises, an industrial or commercial activity through a permanent establishment situated therein, or provides independent personal services from a fixed base situated therein, and the debt claim on which the interest is paid is actually attributable to such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14 shall apply, as the case may be.

4. Interest shall be deemed to arise in a Contracting State if the payer is a resident of that State. However, if the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in respect of which an obligation to pay the interest has arisen and which incurs the cost of the interest, such income shall be deemed to be arises in the State in which the permanent establishment or fixed base is situated.

5. If, due to a special relationship between the payer and the beneficial owner of the interest, or between both of them and any third parties, the amount of interest relating to debt claim, on the basis of which it is paid, exceeds the amount that would be agreed between the payer and the actual recipient of the interest, in the absence of such a relationship, the provisions of this Article shall apply only to the last mentioned amount. In such case, the excess of the payment shall remain taxable in accordance with the laws of each Contracting State and subject to the other provisions of this Convention.

Article 12. Income from copyrights and licenses

1. Income from copyrights and licenses arising in a Contracting State and paid to a resident of the other Contracting State shall be taxable only in that other State if such resident is the beneficial owner.

2. The term "royalties and licenses" as used in this Article means royalties of any kind paid for the use or for the right to use the copyright in a work of literature, art or science, including motion pictures, any recording of sound and images, a computer program , any patent, trade mark, design or model, plan, secret formula or process, or for information relating to industrial, commercial or scientific experience.

3. The provisions of paragraph 1 shall not apply if the beneficial owner of the royalties, being a resident of a Contracting State, carries on in the other Contracting State in which the royalties arise, an industrial or commercial activity through a permanent establishment situated therein, or provides independent services from a fixed base located there, and the right or property in respect of which royalties and licenses are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 14 shall apply, as the case may be.

4. Copyright and license proceeds shall be deemed to arise in a Contracting State if the payer is a resident of that State. If, however, the person paying the royalties from copyrights and licenses, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the obligation to pay royalties from copyrights and licenses arises, and the costs of paying such royalties or licenses shall be borne by the permanent establishment or fixed base, then such royalties and licenses shall be deemed to arise in the Contracting State in which the permanent establishment or fixed base is situated.

5. If, by reason of a special relationship between the payer and the actual recipient of the proceeds, or between both of them and any third parties, the amount of proceeds from copyrights and licenses, taking into account the use, right of use or information for which they are paid, exceeds the amount that would be agreed between the payer and the actual payee in the absence of such a relationship, the provisions of this Article shall apply only to the last mentioned amount. In such case, the excess of the payment shall remain taxable in accordance with the laws of each Contracting State and subject to the other provisions of this Convention.

Article 13. Income from alienation of property

Article 13
Income from alienation of property

1. Income derived from the alienation of immovable property referred to in Article 6 and situated in a Contracting State may be taxed in that State.

2. Income derived from the alienation of shares, shares or other participation rights in a company or legal entity, the assets of which are directly or through the intermediary of one or more companies or legal entities consist principally of immovable property situated in a Contracting State, or rights in such property, may be taxed in that State.

3. Gains from the alienation of movable property forming part of the assets of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State, or of movable property relating to a fixed base which is at the disposal of a resident of a Contracting State in the other Contracting State for the purposes of exercising independent personal services, including such income from the disposal of such a permanent establishment (whether alone or together with an enterprise) or such fixed base, shall be taxable in that other State.

4. Income derived by a resident of a Contracting State from the alienation of ships or aircraft operated by that resident in international traffic, or movable property connected with the operation of such ships or aircraft, including containers referred to in paragraph 2 of Article 8, shall be taxable only in this State.

5. Gains from the alienation of any property other than that referred to in paragraphs 1, , and , shall be taxable only in the Contracting State of which the alienator is a resident.

Article 14. Income from independent personal services

Article 14
Income from independent personal services

1. Income derived by a resident of a Contracting State in respect of professional services or other activities of an independent character shall be taxable only in that State, unless that resident has a fixed base regularly used by him in the other Contracting State for the purpose of carrying on his business. If he has such a fixed base, the income shall be taxed in the other Contracting State, but only so much as is attributable to that fixed base.

2. The term "professional services" includes, in particular, the independent scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, lawyers, engineers, architects, dentists and accountants.

Article 15. Income from employment

Article 15
Income from employment

1. Subject to the provisions of Articles 16, , and wage wages and other similar remuneration derived by a resident of a Contracting State in respect of employment shall be taxable only in that State, unless the employment is carried on in the other Contracting State. If the employment is so carried on, the remuneration received in connection therewith may be taxed in that other State.

2. Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State in respect of employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if:

a) the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in any continuous period of twelve months falling within one or two consecutive financial years financial years tax deductible, and

b) the remuneration is paid by or on behalf of an employer who is not a resident of the other State, and

c) the cost of remuneration is not borne by a permanent establishment or fixed base which the employer has in the other State.

3. Notwithstanding the foregoing provisions of this Article, remuneration derived in respect of employment performed on board a ship or aircraft operated in international traffic may be taxed in the Contracting State of which the person operating the ship or aircraft is a resident.

Article 16. Income of members of administrative and supervisory boards

Article 16
The income of members of the administrative and
supervisory boards

Meeting fees and other similar remuneration derived by a resident of a Contracting State in his capacity as a member of the administrative or supervisory board of a company which is a resident of the other Contracting State may be taxed in that other State.

Article 17. Income of artists and athletes

Article 17
Income of artists and athletes

1. Notwithstanding the provisions of Articles 14 and income deriving by a resident of a Contracting State from his personal activities carried on in the other Contracting State as an artist such as a theatre, film, radio or television artist or musician, or as an athlete, may be taxed taxes in that other State.

2. Where income from personal activities carried on by an artist or athlete in that capacity is credited not to the artist or athlete himself but to another person, whether he is a resident of one of the Contracting States or not, such income, whether or not the provisions of Articles 7, and may be taxed in that Contracting State in which the activities of the artist or athlete are carried on.

3. However, if more than 50 per cent of the income from activities carried on by residents of a Contracting State as an entertainer or sportsman in the other Contracting State derives from the public funds of the first State, such income may be taxed only in the first State.

Article 18. Pensions

Article 18
Pensions

1. Subject to the provisions of paragraph 2 and above, pensions and other similar remunerations paid to a resident of a Contracting State in connection with past employment may be taxed only in that State.

2. Pensions paid under the social security laws of a Contracting State may be taxed in that State.

3. Pensions paid by public institutions of a Contracting State, directly or from funds created by them, to an individual in respect of services rendered other than those rendered in the course of an industrial or commercial activity to one of those institutions may be taxed only in that State. However, these pensions may be taxed only in the other Contracting State if the individual is a resident of that State and is a citizen of that State.

Article 19. Remuneration for public service

Article 19
Public Service Reward

1. Remuneration, other than pensions, paid by the public institutions of a Contracting State to an individual in respect of service rendered to those institutions shall be taxable only in that State. However, these remunerations shall be taxable only in the other Contracting State if the service was performed in that State and if the individual is a resident of that State and is a citizen of that State.

2. The provisions of Articles 15 and shall apply to remuneration payable in respect of service in connection with an activity of an industrial or commercial nature performed by a public agency of a Contracting State.

Article 20. Amounts received by students and trainees

Article 20
Amounts received by students and interns

Amounts which a student or trainee who is, or immediately before arrival in a Contracting State, was a resident of the other Contracting State and is present in the former State solely for the purpose of education or practice, receives for the purposes of his maintenance, education or practice, shall not be taxable in that State, provided that the sources of those sums are outside that State.

Article 21. Other income

Article 21
Other income

1. Elements of income of a resident of a Contracting State, wherever they arise, not covered by the preceding Articles of this Convention, if that resident is the beneficial owner of the income, shall be taxable only in that State.

2. The provisions of paragraph 1 shall not apply to income other than income from immovable property as defined in paragraph 2 of Article 6 if the recipient of such income, being a resident of a Contracting State, carries on an industrial or commercial activity in the other Contracting State through a permanent establishment situated therein. or performs in that other State independent personal services from a fixed base situated therein and the right and property in respect of which the income is paid are effectively connected with them. In such a case, the provisions of Article 7 or Article 14 shall apply, as the case may be.

Article 22. Property

Article 22
Property

1. Property, represented by immovable property referred to in Article 6, which is owned by a resident of a Contracting State and which is situated in the other Contracting State, shall be taxed in that other State.

2. Property represented by shares, shares or other interests in a company or legal entity, the assets of which are principally created directly or through the intermediary of one or more other companies or legal entities, from immovable property situated in a Contracting State, or from rights in such property taxable in that State.

3. Property represented by movable property forming part of the assets of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State, or movable property relating to a fixed base which a resident of a Contracting State has in the other Contracting State for the purpose of performing independent personal services taxable in that other State.

4. Property of a resident of a Contracting State, represented by ships or aircraft operated by that resident in international traffic, and movable property connected with the operation of such ships or aircraft, shall be taxable only in that State.

5. All other items of property of a resident of a Contracting State shall be taxable only in that State.

Article 23. Elimination of double taxation

Article 23
Elimination of double taxation

1. In the case of France, double taxation is eliminated as follows:

a) Income derived from Russia which may be taxed or which is taxable only in that State in accordance with the provisions of the Convention shall be taken into account for the calculation of French tax when the recipient is resident in France and the income is not exempt from tax on companies under domestic French law. In this case, the Russian tax is not deducted from these incomes, and the recipient is entitled to a credit of this tax against the French tax. The amount of the offset is:

(i) on all income not listed in subparagraph (ii), the amount of the French tax corresponding to that income;

(ii) on income referred to in paragraph 5 of Article 6, Article 10, paragraphs 1 and 2 of Article 13, paragraph 3 of Article 15, Article 16, paragraphs 1 and 2 of Article 17 and paragraph 2 of Article 18, the amount of tax paid in Russia in in accordance with the provisions of these articles; this credit may not, however, exceed the amount of the French tax corresponding to these incomes.

b) A French resident who owns property that is taxed in Russia in accordance with the provisions of paragraphs 1 or 3 of Article 22 may also be taxed in France on that property. The French tax is calculated by deducting an amount of credit equal to the amount of tax paid in Russia on this property. This credit may not, however, exceed the amount of the French tax corresponding to this property.

c) It is understood that the expression "the amount of the French tax corresponding to these incomes" used in paragraph a) means:

(i) if the tax payable on those incomes is calculated at a proportional rate, the product, equal to the sum the net income in question multiplied by the rate actually applied to them;

(ii) if the tax payable on those incomes is calculated on a progressive scale, a product equal to the sum of the net income in question multiplied by the rate derived from the ratio between the tax actually payable on the total net income, which is taxable under French law, and the amount of this total net income.

This interpretation by analogy applies to the expression used in subparagraph (b) "the amount of tax corresponding to this property".

d) It is understood that the expression "amount of tax paid in Russia", used in subparagraphs a) and ), means the amount Russian tax finally and actually paid on the income or elements of property in question, in accordance with the provisions of this Convention, by a resident of France who receives these incomes or has at his disposal elements of this property.

2. With regard to Russia, double taxation is eliminated as follows.

Where a resident of Russia derives income or owns property which, in accordance with the provisions of this Convention, is taxable in France, the amount of tax on such income or such property payable in France shall be deducted from the Russian tax levied on the income or property of that resident. Such deduction, however, may not exceed the amount of the relevant taxes on income or property calculated before the deduction in accordance with the laws of Russia.

Article 24. Non-discrimination

Article 24
Non-discrimination

1. Natural persons having the nationality of a Contracting State shall not be subject in the other Contracting State to any taxation or corresponding obligation which is different or more burdensome than those to which natural persons having the nationality of that other State are or may be subject and who are in the same position, in particular with regard to residency.

This provision also applies, notwithstanding the provisions of Article 1, to natural persons who are not residents of one or both of the Contracting States.

2. a) Exemptions and other tax advantages provided by the laws of a Contracting State in favor of that Contracting State or its territorial authorities shall apply under the same conditions to the other Contracting State or its territorial bodies authority over identical or similar activities.

b) The competent authorities of both Contracting States shall agree on a case-by-case basis for the purpose of applying the provisions of subparagraph a) to other public institutions established in one Contracting State which are identical or similar to public institutions established in the other Contracting State.

3. The taxation of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favorable in that other State than the taxation of enterprises of that other State carrying on similar activities.

4. Except as provided in paragraph 1 of Article 9, paragraph 5 of Article 11 or paragraph 5 of Article 12, interest, royalties and other payments made by an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purposes of determining the taxable profits of such enterprise be deductible under the same conditions as if they were paid to a resident of the first-mentioned State. Similarly, the debts of an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purposes of determining the taxable property of such an enterprise, be deductible under the same conditions as debts to a resident of the first-mentioned State.

5. Enterprises of a Contracting State, the capital of which is wholly or partly, directly or indirectly, owned or controlled by one or more residents of the other Contracting State, shall not be subject in the first-mentioned State to any taxation or obligation connected therewith, other or more onerous than taxation and the obligations connected with it to which other similar enterprises of that first-mentioned State are or may be subject.

6. The provisions of this Article shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State personal deductions, reliefs and reductions in tax, by virtue of their marital status or dependants, which it grants to its own residents.

7. If, in addition to this Convention, a treaty, agreement or convention to which the Contracting States are parties contains non-discrimination or most-favored nation provisions, it is understood that such tax provisions do not apply.

8. The provisions of this article shall apply, notwithstanding the provisions of article 2, to taxes of any kind and denomination.

Article 25. Mutual agreement procedure

Article 25
mutual agreement procedure

1. If a person considers that the acts of one or both of the Contracting States result or will result in him being taxed not in accordance with the provisions of this Convention, he may, notwithstanding the remedies available under the domestic laws of those States, submit his declaration to the competent authority of that Contracting State, in which he is a resident or, if his case falls under paragraph 1 of Article 24, to the competent authority of the Contracting State of which he is a national. The application must be submitted within three years from the date of the first notification of acts leading to taxation not in accordance with the provisions of the Convention.

2. The competent authority shall endeavor, if it considers the application to be well founded and if it cannot itself reach a satisfactory solution, to resolve the matter by mutual agreement with the competent authority of the other Contracting State with a view to avoiding taxation inconsistent with the Convention. This agreement shall be carried out irrespective of the time limits provided for by the internal laws of the Contracting States.

3. The competent authorities of the Contracting States shall endeavor to resolve by mutual agreement any difficulties or doubts arising in the interpretation or application of the Convention. They may also come to an agreement in order to overcome difficulties in cases not covered by the Convention.

4. The competent authorities of the Contracting States may enter into direct contact with each other for the purpose of reaching an agreement in the manner indicated in the preceding paragraphs.

Article 26 Exchange of information

Article 26
Information exchange

1. The competent authorities of the Contracting States shall exchange information necessary for the implementation of the provisions of this Convention or the national laws of the Contracting States relating to taxes to which the Convention applies, insofar as the taxation provided for by these laws is not inconsistent with the Convention. The exchange of information is not limited to Article 1. Any information received by a Contracting State shall be treated as confidential, in the same manner as information obtained under the national laws of that State, and shall be disclosed only to persons or authorities (including courts and administrative bodies) engaged in the assessment or collection of taxes referred to in the Convention, enforcement or prosecution in respect of those taxes or adjudication of claims in respect of these taxes. Such persons or bodies use the information only for these purposes. They may disclose this information in open court or in court decisions.

2. In no event shall the provisions of paragraph 1 be construed as imposing on either of the Contracting States an obligation:

a) to carry out administrative measures contrary to the laws and administrative practice of that or of the other Contracting State;

b) to supply information which is not obtainable under the laws or in the normal course of the administration of that or of the other Contracting State;

c) provide information that would reveal any trade, industrial or professional secret or trade process, or information the disclosure of which would be contrary to his vital interests.

Article 27. Employees of diplomatic missions and consular offices

Article 27
Employees of diplomatic missions
and consular offices

The provisions of this Convention shall not affect the tax privileges of members of diplomatic missions and consular posts granted in accordance with the general rules of international law or the provisions of special agreements.

Article 28 Entry into force

Article 28
Entry into force

1. The Contracting States shall notify each other in writing through diplomatic channels of the completion of the procedures necessary for the entry into force of this Convention.

2. This Convention shall enter into force on the date of receipt of the last of the notifications provided for in paragraph 1, and its provisions shall apply:

(a) in respect of taxes withheld at source, to amounts assessed on or after the first day of January of the year next following the year in which the Convention enters into force;

b) in respect of other taxes on income, on income for taxable periods beginning on or after the first day of January of the year next following the year in which the Convention enters into force;

(c) in respect of other taxes, to taxation, on the basis of taxable facts which will take place from the first day of January of the year following the year in which the Convention enters into force.

3. The provisions of the Convention between the Government of the Union of Soviet Socialist Republics and the Government of the French Republic for the avoidance of double taxation of income of October 4, 1985, as well as the provisions of the letters of exchange of March 14, 1967 in relation to the tax regime on income from copyrights and licenses and the Agreement of 4 March 1970 between the Government of the Union of Soviet Socialist Republics and the Government of the French Republic on the avoidance of double taxation in the field of air and sea transport and all tax provisions included in treaties or agreements between the Governments of the Union of Soviet Socialist Republics and the French Republic will cease to have effect in relations between Russia and France in respect of any Russian or French tax in respect of which this Convention will enter into force in accordance with paragraph 2.

Article 29 Termination

Article 29
Termination

This Convention shall remain in force until denounced by one of the Contracting States. Each Contracting State may denounce the Convention through diplomatic channels at least six months before the end of any calendar year. In such a case, the Convention shall cease to have effect:

(a) in respect of taxes withheld at source, to amounts assessed on or after the first day of January of the year next following the year in which the Convention is denounced;

(b) in respect of other taxes on income to income for taxable periods beginning on or after the first day of January of the year following the year in which the Convention is denounced;

c) in respect of other taxes subject to taxation on the basis of taxable facts, which will take place from the first day of January of the year following the year in which the Convention is denounced.

IN WITNESS WHEREOF, the undersigned, being duly authorized thereto, have signed this Convention.

Done in Paris on November 26, 1996 in duplicate in Russian and French, both texts being equally authentic.

Protocol

Upon signing the Convention between the Government of the Russian Federation and the Government of the French Republic for the Avoidance of Double Taxation and the Prevention of Tax Evasion and Violation of Tax Laws in Respect of Taxes on Income and Property, the undersigned agreed that the following provisions form an integral part of the Convention.

1. For the purposes of Article 4, the expression "resident of a Contracting State" includes government agencies of that State as defined in subparagraph (d) of paragraph 1 of Article 3.

2. For the purposes of Article 10, it is understood that a resident of Russia who receives dividends paid by a company that is resident of France may receive a refund of provisional tax on those dividends in the amount of that tax that the company actually paid on those dividends. . The full amount of tax withheld and refunded is treated as a dividend for the purposes of the Convention. It is taxed in Russia in accordance with the provisions of paragraph 1 of this article and in France in accordance with the provisions of paragraph 2 of the same article.

3. It is understood that the provisions of Article 21 shall not apply, in particular, to dividends, interest and income from copyrights and licenses as defined in , and , respectively. The provisions of Article 21 also do not apply to winnings that an individual receives from casino games.

4. a) In calculating the taxable income and profits of a permanent establishment of an enterprise which is a resident of a Contracting State, the following shall be deductible:

(i) interest and income from copyrights and licenses on which it incurs expenses for the purposes of its industrial or commercial activities, paid to a bank or other person and regardless of the term of the loan, but this deduction may not exceed the amount that would be established in the absence of special relations between the payer and the actual recipient of these incomes;

(ii) wages, salaries, social contributions provided for by the laws of the other Contracting State, and other payments at which it incurs expenses payable for services rendered and other expenses at which it incurs expenses for the purposes of its industrial or commercial activities.

b) The provisions of subparagraph "a" shall apply to the taxable income and profits of a company or other taxable entity which is a resident of a Contracting State if:

(i) not less than 30 per cent of its capital is owned by one or more residents of the other Contracting State; And

(ii) total amount its authorized capital is not less than 500,000 French francs or the equivalent of this amount in another currency. Authorized capital consists of joint participation of shareholders, participants and other members, including residents of Russia.

5. Where, under the internal laws of a Contracting State, companies which are residents of that State are permitted to determine their taxable profits by consoli- dation which, in particular, includes the results of branches which are residents of the other Contracting State or permanent other State, the provisions of the Convention shall not prevent the application of that law.

6. The provisions of paragraphs 2 and 7 of Article 24 apply to cultural centers established in accordance with the Agreement of November 12, 1992 between the Government of the Russian Federation and the Government of the French Republic on the establishment and types of activities of cultural centers.

7. Nothing in this Convention shall prevent or restrict France from applying to its residents the provisions of articles 209 B and 212 of its general tax code with regard to the prevention of tax evasion and violation of tax laws or the application of sanctions for tax evasion and violation of tax laws or other similar provisions that could amend or replace the provisions of these articles.

8. In respect of income which is taxable under the provisions of the Convention only in the State of which the recipient is a resident, the other Contracting State shall make every effort to establish procedures to enable such income to be received without any taxation in that other State.

Where the Convention provides for taxation in the Contracting State in which the income arises, that State shall make every effort to establish procedures to enable residents of the other Contracting State to derive such income, net of the tax provided for in the Convention.

However, in the event that the tax has not been collected in accordance with the Convention, the request for reimbursement must be submitted before the end of the third calendar year following that in which the income was received. The tax administration of the Contracting State in which the revenues arise shall express its opinion on the admissibility of the request within two months following its presentation, and the tax collected in that State in excess of the tax prescribed by the Convention shall be refunded to the taxpayer in the month following that in which the request was received.

9. The competent authorities of the Contracting States may regulate the conditions for the application of the Convention, in particular with regard to the formalities for the enjoyment of the benefits provided for by the provisions of the Convention.

In witness whereof the undersigned, being duly authorized thereto, have signed the present minutes.

Done in Paris on November 26, 1996, in duplicate, each in Russian and French, both texts being equally authentic.

Ratified by the Federal Assembly (Federal Law of February 8, 1998 N 18-FZ - Collection of Legislation of the Russian Federation, 1998, N 7, Art. 789).

The Convention entered into force on 9 February 1999.

Electronic text of the document
prepared by CJSC "Kodeks" and checked against:
Collection of legislation
Russian Federation,
No. 21, May 24, 1999

Convention between the Government of the Russian Federation and the Government of the French Republic for the Avoidance of Double Taxation and the Prevention of Tax Evasion and Violation of Tax Laws with Respect to Taxes on Income and Property

Double taxation (DT) is a specific way of taxing assets. In this case, the payer has to pay taxes twice. This option is highly undesirable. Various international agreements have been adopted to avoid double taxation.

What is double taxation

Double taxation is the taxation of assets twice. The doubling arises from the fact that taxes are collected by two states at the same time. This situation happens, as a rule, if the company receives income both in one and in another state. In this case, it is very difficult to determine the taxable base. To avoid DV, organizations are divided into residents and legal entities that were not residents.

There is a Federal Law "On Taxation". According to its points, income acquired in other states is included in the taxable base in the home country. Foreign funds are counted in the amount that is used in the calculation of taxes. In this case, you need to follow some rules. In particular, the amounts that are taken into account for taxation should not exceed the amount of the mandatory tax transferred in the Russian Federation.

Why is DN so undesirable? In fact, it discriminates against the payer. Companies have to pay double the tax. This interferes with the normal conduct of business.

When does double taxation occur?

DN occurs in the following cases:

1. The company pays taxes in two states. The way out is either following the conventions, according to which the tax is levied only in one state, or following the national laws.
2. Companies have to pay tax in various places. The order in question is mixed.
3. Only a portion of the company's profits is taxed. In this case, double taxation also occurs: first, when tax is charged on income, and then when it is charged on dividends. In this case, as a rule, different rates are used for distributable and undistributed income.

Methods for avoiding double taxation are fixed in regulations.

Varieties of double taxation

There are two types of double taxation:

1. Internal. Assets are taxed domestically. Tax collection is carried out at various administrative levels. This form of taxation can be vertical. In this case, the collection is carried out at the local and state level. The vertical form is relevant for Sweden. There is also a horizontal form. In this case, the tax collection is carried out at the same level. This form is relevant for the United States. In some states, only income received in the same state is taxed, in others - income in other states.
2. External. External double taxation arises from the difficulty of establishing either the taxpayer or the tax base.

IMPORTANT! The external form involves taxation outside the state.

What are the reasons for double taxation?

Double taxation occurs in the following cases:

1. The company has dual residency. That is, she is recognized as a resident in two countries.
2. The same income is a taxable base in two states. For example, in one country, income is recognized as a taxable base due to the residence of the company, and in the second - on the basis of the rule on the source of income.
3. The company's expenses are counted in different ways. different states.
4. The source of income is located in several states.

The main reason for the formation of double taxation is various regulations in different states, different regulation of the taxable base. In addition, the normative act can be interpreted in several ways.

Consider an example. In the US, inaccuracies in the return can result in fines of $10,000. In Switzerland, incorrect information in the declaration, if the violations are minor, are treated more loyally. Inaccuracies will not be considered violations. In this case, an international agreement is needed. It is required to harmonize interpretations of regulations.

Tools to Eliminate Double Taxation

Two methods are used to eliminate DN:

1. Unilateral. Assumes measures from one state. This changes the tax regulations in one country. The first method of unilateral elimination of VAT is a tax credit. It involves offsetting taxes paid in another country against the payer's obligations within the state. The second method is a tax credit. It involves deducting from the amount of taxes within the state the amount of taxes paid in another country.
2. Multilateral. It involves the conclusion of international agreements and conventions. That is, to implement this method, the efforts of two states are needed. The most relevant method is distribution. At the same time, assets in one state are no longer taxed in favor of another country.

FOR YOUR INFORMATION! As a rule, both of these methods are used to eliminate double taxation.

Interstate agreements

The first interstate agreement was signed between France and Belgium in 1843. On the given time there are more than 400 such agreements. However, almost all of these regulations are based on the principles of the Pareto optimum. The main criterion: the best option is one that benefits one side, but does not harm the other side. Based on this, we can say that interstate agreements should not worsen the position of the participating country. It is on the basis of the agreement that tax jurisdiction is established.

Based on various international conventions, these methods of eliminating double taxation are distinguished:

• Formation of precise concepts that are used in the framework of regulations. Interpretation of terms.
• Development of a scheme for the elimination of NV, in which each country chooses a separate tax base. The tax is levied on specific income.
• Formation of a mechanism for the elimination of NAM in cases where both states tax all income.
• Elimination of taxation that discriminates against the payer in another country.
• Sharing up-to-date information to prevent mandatory fee evasion or abuse of the law.
• Establishment best ways liquidation of VAT in relation to the income of residents.

States must assist each other in taxation.

Features of determining the maximum amount of payments

The maximum credit amount is calculated as follows:

1. It is determined whether taxes paid in another country are subject to offset when paying tax within the country.
2. The maximum amount is set. In this case, the offset limitation is calculated.
3. The smaller amount is found from the amount of taxes paid in another state and subject to offset, and from maximum amount offset. If a company pays tax in excess of the established maximum amount, it will not be accepted for foreign credit.

Double taxation is a big problem, but it is solved through a number of tools. They can be used by a single country or two states. The interaction of states with each other is considered more effective.

International agreements on the avoidance of double taxation applicable in the territory of the Russian Federation are included in the system of law of the Russian Federation and have priority over the provisions of national tax legislation.

Article 15 of the Constitution of the Russian Federation establishes that international treaties of the Russian Federation are integral part its legal system and if an international treaty establishes rules other than those provided for by law, then the rules of the international treaty shall apply.

Similar rules are established by the Tax Code of the Russian Federation.

For this reason, when taxing foreign persons it is necessary to proceed primarily from the provisions of international treaties in the field of taxation.

The international treaty referred to in the Tax Code of the Russian Federation may have various names in international law: treaty, agreement, convention, and others.

The purpose of concluding an international treaty is to reach an agreement between states or other subjects of international law that establishes their mutual rights and obligations in tax relations to avoid double taxation.

Issues of taxation of persons - residents of one state in relation to their income paid in another state, are regulated by the legislation of these two countries. At the same time, any state has the exclusive right to levy taxes on its territory in accordance with national tax legislation, which also applies to foreign organizations.

It is for this reason that double taxation of foreign organizations arises when a person - a resident of one country receives income from sources located in another country, owns property (usually immovable) in another country or carries out activities that result in income or other income in another country. country. For these situations, it is typical that the same person is considered by the tax legislation as a taxpayer or the same object is considered as an object of taxation simultaneously in two or more countries.

For example, income received by a foreign organization from sources in the Russian Federation is subject to taxation in the Russian Federation in accordance with the provisions of the RF Tax Code. At the same time, these incomes received on the territory of the Russian Federation are also subject to taxation in accordance with the legislation of the foreign state of the recipient of income. Accordingly, the tax in this case is paid twice: for the first time - in accordance with the norms of the tax legislation of the state - the source of income, the second - in accordance with the norms of the internal legislation of the state - the recipient of income.

The provisions of an international treaty determine the rules for delimiting the rights of each of the states to tax organizations of one state that have an object of taxation in another state.

In addition, amounts of tax paid in the source State in accordance with the domestic tax laws of that State may be credited against the payment of tax by a foreign entity abroad. The procedure for offsetting taxes paid abroad is regulated by the tax legislation of a foreign state. In Russia, a similar procedure is applied, provided for in Article 232 of the Tax Code of the Russian Federation.

As a general rule, the amount of creditable taxes paid in the source state cannot exceed the amount of tax payable by this organization abroad on the relevant income, calculated in accordance with the tax laws and regulations of the foreign state. The offset is made subject to the presentation by the taxpayer of a document confirming the withholding of tax in the state - the source of income.

It should be borne in mind that the current international tax agreements (on the avoidance of double taxation) determine only the rules for delimiting the rights of each of the states to tax organizations of one state that have an object of taxation in another state, however, the methods for implementing these provisions: the procedure for calculating, paying taxes, collecting tax amounts not paid in deadlines, and bringing to responsibility for violations committed by the taxpayer - establish domestic norms of tax law.

In addition to eliminating double taxation, international agreements aim to develop mechanisms to prevent tax evasion and reduce the possibility of abuse of the rules of agreements in order to avoid tax through the exchange of information between the competent authorities of the respective states.

Agreements for the avoidance of double taxation (treaties, conventions) are multilateral and bilateral agreements that establish the rules in accordance with which the avoidance of double taxation is achieved:

1) income received by individuals and legal entities;

2) property and income from the sale of property;

3) income and property in the field of international transportation;

Accordingly, double taxation in international economic relations may arise in relation to the following taxes:

1) income tax from individuals;

2) corporate income tax;

3) (both individuals and legal entities, and other laws).

Double tax treaties generally contain:

1) listing the types of taxes regulated by the agreement (article "Taxes covered by the agreement");

2) determination of the circle of persons to whom the agreement applies;

3) determining and establishing the conditions of taxation (taxation restrictions) in the state - the source of income of such types of income as:

Profits from commercial activities;

Dividends;

Interest;

Income from dependent personal activities (income from employment);

Income from independent personal activities (compensations and fees);

other income;

4) determination of ways to avoid double taxation (tax exemption or application of a foreign tax credit);

5) establishment of the procedure for the implementation of the agreement by the parties (entry into force, duration, procedure for terminating the agreement, application of mutual agreement procedures).

Separate provisions of these Agreements differ from each other, since the Agreements are bilateral in nature and are concluded based on the nature of relations between Russia and a particular country. However, many agreements are based on the Organization for Economic Co-operation and Development (OECD) Model Convention on Taxes on Income and Capital and contain similar provisions.

In this regard, it is possible to generalize the principles of income taxation in accordance with international agreements.

For the purpose of applying double tax treaties concluded by the Russian Federation ( former USSR), revenues are subdivided:

1) on income (profit) from commercial activities;

2) for special types of income, for which special taxation regimes, exemption from taxation, tax credits are provided.

Profits from commercial activities in the context of double tax treaties are incomes of foreign organizations operating through a permanent establishment in the Russian Federation.

For this type of income, the norms of agreements on the avoidance of double taxation, as well as the norms of the national tax legislation of a number of countries, establish the main taxation regime and standard forms elimination of double taxation.

TO os Common types of income for which special taxation regimes and tax exemptions are provided include:

a) income from international transportation, dividends, interest;

b) income from real estate, from the sale of real and movable property, from copyrights and licenses (intellectual property);

c) income from employment;

d) income from independent personal activities ( professional services), fees of directors of enterprises, remuneration or other income from public service, pensions;

e) income of artists and athletes, teachers, scientists, students and trainees;

e) other income.

Differences in approaches to taxation of income from certain types activities are determined by the specifics of these incomes, the conditions and nature of the activity, as well as the characteristic features of the activity certain categories subjects of taxation.

The article of agreements “Profit from commercial activities” affects all types of income, with the exception of those types, the taxation procedure for which is determined in special articles.

The corresponding article of the agreement determines in which state this or that income or this or that part of it will be taxed. The very order of the taxation procedure, conditions and mandatory requirements are always established in accordance with the national legislation of the state that carries out taxation.

In the article of the agreement “Profit from commercial activities”, the parties that entered into the agreement consider profit as an object of taxation, that is, the difference between the income received and the expenses incurred to extract these incomes, and in the articles related to special types activities, we are talking about income.

Subject to agreement, profits from commercial activities derived in one contracting state by a person with a permanent residence in the other contracting state may be taxed in the first state only if it is received through its permanent establishment located there (permanent establishment of a foreign organization) and only to the extent , which can be attributed to the activities of this permanent establishment. In this approach, the principle of territoriality finds its application, according to which in the territory of one state only profits received from sources located in the territory of this state are taxed. Application this principle international treaties is usually specified as follows: “If a resident of one contracting state carries out a commercial or other economic activity in the other contracting State through a permanent establishment situated therein, then in each contracting State such permanent establishment shall include the profits which it would have received had it been a separate and separate person carrying on the same or similar activities under the same or similar conditions, and acting completely independently." Thus, on the one hand, those types of profit that a person receives from sources in a given country, regardless of the activities of the specified representative office, do not belong to the profit of the representative office, and on the other hand, a possible underestimation of the amount of profit received by the person from the activities of his permanent representative office is prevented.

Typically, agreements general characteristics the procedure for calculating the profit of a permanent establishment and indicate those types of expenses that are allowed to be deducted from taxable income to determine the object of taxation - profit received through a permanent establishment. This is stated in the model Agreement as follows: “In determining the profits of a permanent establishment, a deduction may be made for expenses incurred for the purposes of the activities of this permanent establishment. However, a reasonable redistribution of documented expenses between a resident of a Contracting State and his permanent establishment in the other Contracting State is permitted. Such expenses shall include management and general administrative expenses, research and development expenses, interest and fees for management, advice and technical assistance, whether incurred in the State in which the permanent establishment is situated or elsewhere.”

The profit attributable to a permanent establishment must be determined annually by the same method, unless there is good and sufficient reason to change it.

If the profit includes types of income that are specifically mentioned in other articles of the agreement, then the provisions of these articles are not affected by the provisions of the article “Profits from commercial activities”.

The Russian Federation has concluded double taxation avoidance agreements with many states.

More than 70 international agreements (conventions, treaties) are currently in force. Along with the agreements concluded by the Government of the Russian Federation, the agreements concluded by the Government of the USSR continue to operate.

The current international agreements of Russia on the avoidance of double taxation of income and property differ significantly on a number of issues, including in individual agreements they often use special concepts and terms.

In addition to general international agreements on the elimination of double taxation, there are a number of special bilateral agreements, mainly on the elimination of double taxation in the field of international (sea and air) transportation, concluded by the government of the USSR. Such agreements have been concluded with the People's Democratic Republic of Algeria (dated 11.06.88), the Argentine Republic (dated 30.03.1979), the Hellenic Republic (dated 27.01.76), the Republic of Iraq (dated 26.09.74), Ireland (dated 12/17/1986), the French Republic (dated 03/04/70).

Russia is a member of the Geneva Diplomatic and Consular Conventions, as well as the multilateral Convention for the Avoidance of Double Taxation of Royalties (Madrid, December 13, 1979).

In relations with individual countries in the 1990s, agreements between the countries of the Council for Mutual Economic Assistance continued to operate on the elimination of double taxation of income and property of individuals (concluded on May 27, 1977 in relation to Mongolia, Slovakia and the Czech Republic), as well as on the elimination of double taxation of income and property of legal entities (signed on May 19, 1978; continued to be valid for the same countries).

An independent group consists of bilateral agreements on the avoidance of double taxation of income and property of the Russian Federation with the CIS member countries: Agreement with the Republic of Azerbaijan (dated 03.07.97), Agreement with the Republic of Belarus (dated 21.04.95), Agreement with the Republic of Uzbekistan (dated March 2, 1994; ratified on April 24, 1995), with Ukraine (dated February 8, 1995).

Learn more about accounting and tax accounting in foreign organizations on the territory of the Russian Federation, you can get acquainted in the book of CJSC "BKR Intercom-Audit" " Foreign organizations and their representations.