Controlled foreign company (CFC). What you need to know about kick What is kick in VK

On November 24, 2014, a law was passed (Federal Law "On Amendments to Parts One and Two tax code Russian Federation(in terms of taxation of profits of controlled foreign companies and income of foreign organizations)" No. 376-FZ of November 24, 2014) aimed at deoffshorization, incl. containing the so-called CFC rules (Controlled Foreign Company rules). The innovation is aimed at preventing the use of low-tax jurisdictions in order to obtain tax benefits, a similar legal structure has been used by tax authorities for many years different countries. The document entered into force on January 1, 2015.


What is a kick? A controlled foreign company is an organization that is a resident of a foreign state and controlled by residents of the Russian Federation (both individuals and legal entities). The scope of the rules includes not only offshore companies from the so-called "black" list, but any foreign companies controlled by Russian residents. A controlling person is a person whose share of participation in the organization is more than 25% (before January 1, 2016 -50%); or a person whose share of participation is more than 10%, if the share of participation of all persons recognized tax residents RF in this organization is more than 50%. Note that when determining the share of participation in accordance with Art. 105.2 of the Tax Code of the Russian Federation consider not only direct participation, but also indirect. At the same time, when determining the share of an individual, his participation together with his spouse and minor children is taken into account. It is important that a person who does not meet the above criteria for participation, but exercises control over foreign organization(having influence or having the ability to influence decisions on the distribution of profits after tax).


CFC taxation. By general rule CFC profits are subject to taxation in the territory of the Russian Federation, while taxes paid in foreign country, will be taken into account when determining tax liabilities in Russia. The taxpayer is obliged to include CFC profits in tax base. Together with the declaration to the Federal Tax Service, it is also necessary to submit reports of a controlled company and, if any, audit report. Minimum size profit subject to declaration will amount to 50 million rubles in 2015, 30 million rubles in 2016, and 10 million rubles after 2017. Non-payment or incomplete payment by the controlling person of tax amounts as a result of non-inclusion in the tax base of a share of CFC profits, entails a fine in the amount of 20% of the amount of unpaid tax, but not less than 100,000 rubles. Note that if the criteria established by the Criminal Code of the Russian Federation are met, non-payment of CFC tax may result in criminal liability.
Released in 2017 guidelines on how to account for CFC profits, how to recognize income of a controlled foreign company, how to carry forward CFC losses to future periods (letter of the Russian Ministry of Finance dated February 17, 2017 No 03-12-11/2/9197 and letter of the Russian Ministry of Finance dated February 10, 2017 No. 03-12-11/2/7395)


Exceptions. The profit of a CFC is exempt from taxation in the territory of the Russian Federation if the controlled foreign company is a resident of a country with which the Russian Federation has concluded a Double Tax Treaties (DTT), this state ensures the exchange of information with the Russian Federation for tax purposes and the effective tax rate is at least 75% of the weighted average tax rate. The weighted average rate also takes into account income from current activities, and dividend income ( The weighted average tax rate is determined by the formula: CTavzash = (St1*P1 + St2*P2) / (P1 + P2), where P1 is the entire profit of a foreign company, excluding dividends; St1 - income tax rate in the Russian Federation (20%); P2 - dividends received by a foreign organization; St2 - Russian rate tax applicable to dividends (9%, 15%). The effective rate of taxation of income (profit) of a foreign organization is determined as follows: STeff = N / A, where N is the amount of tax, and P is the amount of income (profit) of a foreign organization).

Also, CFC profits are exempt from taxation in the territory of the Russian Federation, provided that the share passive income(dividends, interest, royalties, sale of assets) does not exceed 20% in the structure of their income, again, when information is exchanged between countries and there is an agreement on the avoidance of double taxation. We believe that in accordance with the latest trend in law enforcement, even if the above conditions are met, it may be necessary to prove tax office and the court that the CFC is a resident of a country with which a double taxation treaty has been concluded, is not a transit company between an organization from the Russian Federation and an offshore company, and exists not only on paper.


The obligation to notify the FTS. Residents of the Russian Federation must notify tax authority on their participation in foreign organizations (within one month from the date of the emergence/change of the participation interest in a foreign company) and on the presence of CFCs (notifications are submitted no later than March 20 of the year following the tax period in which the CFC profit is subject to accounting with the Russian resident taxpayer). We emphasize that it is necessary to notify if the organization is a CFC, regardless of whether it falls under the exclusion criteria for taxation of its profits. Note that the taxpayer needs to disclose not only information about the CFC, but also the entire ownership structure - all organizations through which participation in the CFC is realized. If the Federal Tax Service has information, including information indicating that the taxpayer is a controlling person of a foreign organization, but such a person has not sent a notification to the tax authority, the Federal Tax Service sends a request to this taxpayer to provide the necessary explanations or submit a notification within twenty days.
On January 10, 2017, the order of the Federal Tax Service approved the notification form for controlled foreign companies
and how to complete it. Thus, in 2017 it is necessary to report on your own taxable income for 2016, including income from CFC for 2015. be sent to the tax authorities. In addition, in the updated income tax return it is necessary to reflect the tax calculated on the share in the profit of the CFC, and in the declaration 3-NDFL5 - income in the form of profits of the CFC. In case of termination of participation in foreign organizations, the taxpayer also informs the tax authority about this no later than one month from the date of termination of participation.
Violation of the obligation to notify the tax authority, or the submission of false information threatens with a fine: for failure to notify about participation in a foreign organization - in the amount of 50,000 rubles; for failure to notify about a CFC - in the amount of 100,000 rubles.


What does this mean for you? New rules of the rule aimed at deoffshorization Russian economy and in many cases make it impossible to set up offshore companies. However, the innovations apply not only to those who use tax havens for tax minimization purposes, but also to those who use companies in "white" jurisdictions to conduct business and invest. Controlled foreign company legislation will affect almost everyone who uses non-resident companies.

Taxpayers need to analyze their participation in foreign organizations, as well as their ability to influence the decisions of such organizations, based on grounds other than participation in the capital. The analysis should take into account:

It is necessary to identify the risks and calculate the financial feasibility of the current ownership structure. Develop a scheme for restructuring activities. It should be borne in mind that legal procedures related to the transfer of business to other jurisdictions can take a significant amount of time.


P.S.: If you have any questions on this topic, you can use our consulting services. Business Development Specialists can carry out a review of the current ownership structure and draw up a restructuring scheme for .


Call! Tel.: 8-921-786-43-15 We will answer all your questions or arrange a meeting.
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This article has been updated in accordance with regulations on taxation of CFCs in 2017

12.10.2016

Most likely due to the adoption federal law on amendments to parts one and two of the Tax Code of the Russian Federation (in terms of taxation of profits of controlled foreign companies and income of foreign organizations) No. 376-FZ (hereinafter - "FZ - 376" or "CFC Law") you have a number of questions.

We hope that the following information letter will help clarify some of them, and also, in principle, will provide an opportunity to adjust the work of your business in the context of the deoffshorization of Russian legislation.

1. What do I need to notify the Tax Service?

The taxpayer is obliged to notify the tax authority at the place of its registration:

1) on its participation in foreign organizations (if the share of such participation exceeds 10 percent).

2) on the establishment of foreign structures without education legal entity, as well as on control over them or the actual right to income received by such a structure (including cases when the taxpayer acts as the founder of such a structure or a person having the actual right to income (profit) of such a structure in the event of its distribution, that is, is the beneficiary of such a structure );

3) on controlled foreign companies, of which they are controlling persons.

2. By what date is it necessary to notify the tax authority?

In accordance with Part 3 of Art. 4 FZ - 376 The tax authority had to be notified before June 15, 2015. (If the controlled foreign company was registered before the specified date).

From the moment of participation in a foreign controlled company, it is necessary to notify the tax service within 3 months.

3. What is a controlled foreign company (CFC)?

A CFC is recognized as a company that meets two conditions:

1) the organization is not recognized as a tax resident of the Russian Federation;

2) the controlling persons of the organization are organizations and/or individuals recognized as tax residents of the Russian Federation.

In particular, a CFC is recognized as a foreign structure without the formation of a legal entity, the controlling persons of which are organizations and/or individuals recognized as tax residents of the Russian Federation

4. Am I a controlling person of a CFC?

The following will be recognized as a controlling person in relation to a CFC:

1) an individual or legal entity whose share in the organization is more than 25 percent;

2) an individual or legal entity whose share of participation in the organization (for individuals- together with spouses and minor children) is more than 10 percent, if the share of participation of all persons recognized as tax residents of the Russian Federation in this organization (for individuals - including spouses and minor children) is more than 50 percent.

5. I am neither a director nor a shareholder of the company, and the only documents that have my name and the name of the company on the same page are the Power of Attorney and Declaration of Trust. Can I be recognized as a controlling person?

Yes, you can. You can be recognized as a controlling person if you are the beneficiary of the company, that is, you have or are able to exercise a decisive influence on the decisions taken by such an organization regarding the distribution of profit (income) received by the organization after tax due to direct or indirect participation in such an organization, participation in the contract (agreement), the subject of which is the management of this organization, or other features of the relationship between the person and the organization and (or) other persons.

That is, if you directly or indirectly influence decision-making in an organization, and also directly or indirectly bear the risks for the decisions made by the organization, from the point of view of the tax authorities of the Russian Federation, you exercise control over a foreign company, and, therefore, you are a controlling person. Accordingly, you need to declare that you have a CFC.

6. I used to have a foreign company that I controlled, but I haven't used it for a long time. What's more, I don't even pay to renew it. state fees. I do not need this company, I "threw" it. Do I have to notify the Tax Service that I have a CFC?

Yes, they should. If your case is similar to the situation described above, then you have an obligation to notify the tax authorities.

You may not report companies in which you were a controlling person in the following cases:

1) The company was properly liquidated before 06/14/2015. This means that you have a certificate of liquidation of the company. In all other cases, the company is not considered to be properly liquidated.

2) The company has been completely transferred to another person, and the transfer procedure has been properly legalized and completed. Depending on how the transfer of the company was made, you must have on hand the relevant documents that confirm such a transfer.

7. Can someone notify the IRS for me?

You can fill out the CFC declaration only on your own behalf and submit it once a year, entering all the data on your companies into it. You can submit the declaration to the Tax Office yourself or your authorized representative under a power of attorney issued by you. The power of attorney must be notarized. The power of attorney must contain the authority to represent your interests in state bodies. authorities, it is desirable to indicate a specific tax authority.

8. How to file a notice with the Internal Revenue Service? Is there any form?

9. What information should the notification contain?

The law determines what information must be included in a CFC notice. Thus, the notice must contain:

1) the period for which the notification is submitted;

2) the name of the foreign organization (foreign structure without the formation of a legal entity), the notification of participation in which (of the establishment of which) is submitted by the taxpayer;

3) registration number (numbers) assigned to a foreign organization in the state (on the territory) of its registration (incorporation), code (codes) of the foreign organization as a taxpayer in the state (on the territory) of its registration (incorporation) (or their equivalents), address in the state (territory) of registration (incorporation) of a foreign organization, if any;

4) the organizational form of the foreign structure without the formation of a legal entity, the name and details of the document on the establishment of the foreign structure without the formation of a legal entity, the date of establishment (registration) of the foreign structure without the formation of a legal entity, the registration number (other identifier) ​​in the state of establishment (registration) of the foreign structure without forming a legal entity, if any (or their equivalents);

5) the date that is the last day of the period for which the financial statements of the organization (foreign structure without formation of a legal entity) are prepared for the financial year in accordance with its personal law;

6) date of compilation financial reporting organization (foreign structure without forming a legal entity) for the financial year in accordance with its personal law;

7) the date of drawing up the audit report on the financial statements of a foreign organization (foreign structure without forming a legal entity) for the financial year (if, in accordance with the personal law or the constituent (corporate) documents of this foreign organization (foreign structure without forming a legal entity), a mandatory audit is established such financial statements or such audit is carried out by a foreign organization (foreign structure without forming a legal entity) voluntarily);

8) the taxpayer's share in a foreign organization, disclosure of the procedure for the taxpayer's participation in a foreign organization in the presence of indirect participation, including through a Russian organization and (or) using a foreign structure without forming a legal entity, if the taxpayer is recognized as the controlling person of such a foreign structures without forming a legal entity, indicating the following information:

Information provided for in subparagraphs 2, 3 and 4 of this paragraph - in relation to each subsequent organization (foreign structure without forming a legal entity), through which (using which) indirect participation in a foreign organization is realized;

Name, main state registration number, an identification number taxpayer, code of the reason for registration of a taxpayer - a Russian organization through which indirect participation in a foreign organization is realized;

Interest in each subsequent organization through which indirect participation in a foreign organization is realized;

10) a description of the grounds for exempting the profits of a controlled foreign company from taxation in accordance with this Code.

Financial statements refer to the unconsolidated financial statements of an organization.

10. Is the profit of a CFC subject to taxation in accordance with the Tax Code of the Russian Federation?

The profit of a controlled foreign company is taken into account when determining the tax base for the tax period for the relevant tax, if its value is more than 10,000,000 rubles.

However, as we see from paragraph 10 of the previous question, profits can be exempt from taxation in Russia. The legislator has identified 8 grounds on which CFC profits may not be taxed in the territory of the Russian Federation:

1) she is non-profit organization which, in accordance with its personal law, does not distribute the received profit (income) between shareholders (participants, founders) or other persons;
2) it is formed in accordance with the legislation of the state - a member of the Eurasian Economic Union and has a permanent location in this state (Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia);

3) effective rate taxation of income (profit) for this foreign organization, determined in accordance with this article on the basis of the results of the period for which, in accordance with the personal law of such an organization, financial statements for the financial year are prepared, is not less than 75 percent of the weighted average tax rate for corporate income tax;

4) it is one of the following controlled foreign companies:

an active foreign company;

an active foreign holding company;

an active foreign sub-holding company;

5) it is a bank or an insurance organization operating in accordance with its personal law on the basis of a license or other special permit for banking or insurance activities;

6) it is one of the following foreign organizations:

issuer of outstanding bonds;

an organization to which the rights and obligations under issued tradable bonds were assigned, the issuer of which is another foreign organization;

7) it participates in mining projects carried out on the basis of production sharing agreements, concession agreements, license agreements or service agreements (contracts) concluded with the state (territory) or with organizations authorized by the government of such state (territory), similar to agreements on production sharing, or on the basis of other similar agreements concluded on the terms of risk sharing.

Profits of controlled foreign companies referred to in this subparagraph shall be exempt from taxation if all of the following requirements are met:

a foreign organization participates in mining projects as a party to the agreement (contract) specified in the first paragraph of this subparagraph;

the share of income received from participation in the agreements (contracts) specified in the first paragraph of this subparagraph for the period for which, in accordance with the personal law of a foreign organization, financial statements for the financial year are prepared, is at least 90 percent in total amount income of such an organization according to its financial statements for the specified period, or such organization has no income for the specified period;

8) it is the operator of a new offshore hydrocarbon deposit or a direct shareholder (participant) of the operator of a new offshore hydrocarbon deposit.

11. What documents are used to calculate CFC profit?

Confirmation of the company's profitability indicators are financial statements prepared in accordance with the laws of the country of incorporation (registration) of the company. Financial statements are the unconsolidated financial statements of a company.

The taxpayer - the controlling person represents tax return on tax, when determining the tax base for which the profit of a foreign company controlled by this person is taken into account, with the following documents attached:

1) financial statements of a controlled foreign company or, in the absence of financial statements, other documents;

2) an auditor's report on the financial statements of a controlled foreign company, if, in accordance with the personal law of this controlled foreign company, a mandatory audit of such financial statements is established.

12. Under the law of my company's country of incorporation, I am not required to file financial statements. Do I need to submit financial statements in this case? In accordance with which law to submit reports in this case?

Yes, it is necessary, because only financial statements can confirm the performance of your company. These indicators will be important if you want to claim the exemption of CFC profits from taxation on grounds 3 and 5 of the ninth question. If there is no mandatory financial reporting requirement in the jurisdiction where the company is registered, you must file reports in accordance with international standards accounting and audit.

13. Is failure to provide notice tax service about CFC tax offense?

Failure to submit a notice of participation in foreign organizations on the grounds and within the established time limits is recognized as a tax offense, liability for which is provided for in Section 129.6 of the first part of the Tax Code of the Russian Federation.

We would like to draw your attention to the fact that if the tax authority has information, including information received from the competent authorities of foreign states as part of the exchange of information for tax purposes in accordance with international treaties of the Russian Federation, indicating that the taxpayer is a controlling person of a foreign organization ( a foreign structure without forming a legal entity), but such a person has not sent a notification to the tax authority, the tax authority sends a request to this taxpayer to provide the necessary explanations within twenty days or to submit a notification within the period established by the tax authority.

Wrongful non-representation in set time by the controlling person to the tax authority notifications of controlled foreign companies for a calendar year or submission by the controlling person to the tax authority of a notice of controlled foreign companies containing false information, entails a fine in the amount of 100,000 rubles for each controlled foreign company, information about which is not provided or about which false information has been provided.

Unlawful failure by a taxpayer to submit a notice of participation in foreign organizations to the tax authority within the prescribed period or submission of a notice of participation in foreign organizations containing false information shall result in a fine in the amount of 50,000 rubles in respect of each foreign organization, information about which is not provided or in respect of which provided false information.

Non-payment or incomplete payment by a controlling person who is a taxpayer - an individual or organization, of the amounts of tax as a result of not including a share of the profit of a controlled foreign company in the tax base entails a fine in the amount of 20 percent of the amount of unpaid tax in respect of the profit of a controlled foreign company that is subject to inclusion in the tax base. the base for personal income tax for controlling persons who are taxpayers - individuals, the tax base for corporate income tax for controlling persons who are taxpayers - organizations, but not less than 100,000 rubles.

14. How to properly adjust the work of the business in the light of all the above issues?

In the light recent changes, we would like to draw your attention to the fact that, first of all, it is necessary to collect all the information on business structures and your participation in them. Also, it is necessary to prepare at least a draft version of the financial statements in order to clearly understand whether it is possible to claim grounds for exempting the company's profits from taxation.

Adjustment of the work of the business structure in the light of the deoffshorization of the Russian tax legislation possible, but requires an individual approach in each case.

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Controlled foreign company- a foreign company, a certain part of the shares of which is owned by tax residents of this country.

In the Russian Federation, for the purposes of taxation of profit, it is considered controlled, which is not recognized as a tax resident of the Russian Federation and whose controlling person is a legal entity and (or) an individual recognized as tax residents of the Russian Federation.

The exercise of control over an organization is considered to be the provision or the ability to exert a decisive influence on the decisions taken by this organization regarding the distribution of the profit (income) received by the organization after taxation by virtue of direct or indirect participation in such an organization, participation in an agreement (agreement), the subject of which is the management of this organization. organization, or other features of the relationship between a person and this organization and (or) other persons

Also considered a controlled foreign company (a fund, partnership, partnership, trust, other form of collective investment or trust management), the controlling person of which is an organization or individual recognized as tax residents of the Russian Federation.

Control over a foreign structure without forming a legal entity means exerting or the ability to exert a decisive influence on the decisions made by the person managing the assets of such a structure in relation to the distribution of the profit (income) received after taxation in accordance with the personal law and (or) constituent documents of this structure .

At the same time, the law of the country where it is established is considered the personal law of a legal entity.

Controlling person of a foreign company

Criteria under which a person is recognized as a controlling person of a foreign company:

CFC notice

Taxpayers are required to notify the tax authority of the CFC.

Organizations and citizens who:

are the controlling persons of the CFC;

are required to pay corporate income tax (personal income tax) on CFC profits (in part of their share).

A notification of a CFC shall be submitted no later than March 20 of the year following the year in which the share of the CFC's profit is to be accounted for by the controlling person.

In this case, the taxpayer may be fined 100 thousand rubles. (for each CFC):

for failure to provide notice;

belated presentation;

providing incorrect information in the notice.

When you need to pay income tax / personal income tax on CFC profits

Controlling entities must declare CFC profits (in part of their share) and pay income tax (or personal income tax, if we are talking about citizens) on it in cases where the amount of CFC profit is:

for 2015 - 50 million rubles. and more;

for 2016 - 30 million rubles. and more;

for 2017 and subsequent - more than 10 million rubles.

The profit of a CFC is determined based on the data of its financial statements with the features specially established by the Tax Code of the Russian Federation.

When calculating income tax/personal income tax in respect of CFC income, the amount of tax paid in a foreign country can be set off if supporting documents are available.

The following penalties apply to the controller:

if the CFC profit tax is underpaid - 20% of its amount, but not less than 100 thousand rubles;

if CFC documents are not attached to the declaration (or unreliable ones are attached) - 100 thousand rubles.

At the same time, there will be no penalty for underpayment in relation to tax periods 2015 - 2017).

But that doesn't mean you can't pay taxes. The fine will be released only if the damage to the budget is fully compensated. That is, arrears and penalties will still be collected.

Still have questions about accounting and taxes? Ask them on the accounting forum.

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