New draft law concerning foreign clients of Russian banks
Article 1 minute read

New draft law concerning foreign clients of Russian banks

13 June 2016

Russian tax authorities have prepared a new draft law concerning the automatic exchange of data obligations for foreign clients of Russian banks.

According to public information the Federal Tax Authorities (FNS) have prepared a new draft law impacting banks, management and insurance companies and depositories. Under it, they would be obliged to supply to Russian tax authorities data on accounts opened by foreign clients. Failure to meet this obligation would lead to the imposition of fines of up to RUB 500,000.

Banks and financial institutions will be required to report to the FNS under the OECD’s documentations on the automatic exchange of data. Russia is due to sign it during the next OECD forum. One of the requirements is to collect data on the accounts of non-residents according to Common Reporting Standards (CRS) which is the analogy of FATCA.

Data should be collected for the first time in 2017, and transferred to Russian Tax Authorities in 2018. According to the draft law, banks and financial institutions are to report on the investment income of clients, sales of shares, account balances, percentage on deposit and bonds and so on. Ultimate beneficial owners of accounts should also be determined and this data will also be transferred to the FNS. The transfer of data is due once annually. The exhaustive list of data, terms and procedures for the transfer to the FNS will be determined by the by-laws of the Russian Government.

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Written by

Ulyana Holovenko

Former Managing Director, TMF Cyprus and Malta

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