Starting from January 01, 2021, Russian residents, including legal entities and individuals, can benefit from tax exemption with respect to capital gains arising from the sale of shares and participatory interest in Russian and foreign companies held for more than five years. Changing of the tax residency/re-domiciliation of such companies would not interrupt the shareholding period.
However, the said incentive will apply to capital gains from the sale of shares and participatory interest in foreign companies, provided that such companies are not located in jurisdictions black-listed by the Russian Ministry of Finance. Furthermore, tax exemption will not be available if the subsidiary qualifies as a “property-rich” company in Russia (i.e. the immovable property located in Russia represents more than 50% of the company’s assets) subject to certain very limited exceptions (innovation companies listed on a stock exchange).
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NAZALI TAX & LEGAL |