Submitting the Personal Income Tax Return (3-NDFL form) is obligatory for Russian citizens and foreign nationals.

Companies and their employees should file PIT in the following cases:

The income is subject to income tax on individuals.

Senior managers receiving remuneration from the head office based abroad or Russian citizens renting apartments out must declare such income.
To avoid double taxation of income received from abroad, it is important to be familiar with the current legislation. Let’s take a case of a Russian citizen who is paid dividends in the Netherlands, and whose income tax is paid out to the Netherland tax authorities. According to the “Agreement between the Government of the Russian Federation and the Government of the Kingdom of the Netherlands for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income and capital”, the tax paid in the Netherlands can be reflected in the PIT declaration filed in Russia. In this case an individual needs to provide supporting documents from the foreign tax authorities.

Employee needs a tax deduction

The most frequently claimed tax deductions are social and property-related expenses (education and health care, purchase of an apartment, mortgage interest, etc.).

An individual needs to file a list of documents confirming the right to deduction together with the PIT return. When filing for a property-related tax deduction, one can add the interest on the mortgage loan (up to 3 000 000 rubles in 2014) to the amount of the purchase (up to 2 000 000 rubles).

In this case the supporting documents will include:
  • Application for deduction
  • PIT return (3-NDFL) with the recipient’s bank details
  • Annual PIT statement (2-NDFL) for the tax year for which the deduction is claimed
  • Apartment purchase contract
  • Commissioning and acceptance certificate
  • Certificate of ownership
  • Documents confirming the purchase: bank statements showing transfer of the funds from the buyer’s to the seller’s account, payment documents (receipts, checks, seller’s receipt on receiving the money)
  • Application for the allocation of the property tax deduction (in case the apartment is not under sole ownership)
  • Mortgage contract
  • Mortgage amortization schedule
  • Bank confirmation letter and statement showing the interest actually paid in 2014
  • Copy of passport (pages showing personal data and residence permit)

Preparing the PIT declaration:

  • Sber Solutions tax specialist requests a list of necessary documents after the initial meeting or conversation with the client
  • The consequences of not paying the tax within the period required by law are explained to the client
  • The tax specialist also explains the procedure of making tax payments and claiming for tax deductions
  • Sper Solutions prepares the PIT return, requesting additional information or documents from the client when needed
  • Sber Solutions submits the declaration to the tax authorities and interacts with them during the desk audit and process of tax return or after the receipt of the tax demand
  • We forward the PIT declaration and the tax demands to the client
  • We also provide Russian translation services when representing non-Russian speaking clients.