Income Tax in Russia

The corporate income tax or CIT applies to the worldwide incomes generated by Russian legal entities. According to the tax reviews and updates for 2025, the standard CIT rate is set at 25%. All you need to know about the Russia income tax rate can be discussed with our Russian lawyers with experience in the taxation field. The same team can help foreign entrepreneurs register for taxation in this country.

What is the corporate income tax in Russia?

As mentioned earlier, CIT or the corporate income tax is set at 25% and it applies to the total worldwide income generated by Russian legal entities, as stated by the Tax Law in Russia. According to the same set of laws, an 8% rate of CIT is distributed to the federal budget in Russia, while the rest of the 17% rate is directed to different regional budgets, between 2025 and 2030. Companies with permanent establishments in Russia must pay the 25% CIT on Russia-source income, plus the withholding tax that ranges from 10% to 20% rates.

The taxation on personal income in Russia

PIT is the personal income tax in Russia, and it is applicable to the total worldwide income in a year. Foreigners with incomes in Russia are levied on the incomes generated in this country, yet some tax exemptions might apply in accordance with the tax treaties signed by Russia. PIT applies to dividends received from legal entities in Russia, properties in Russia, and other activities developed in the country. Here are important details about PIT in Russia:

1. Annual incomes of up to RUB 2.4 million are subject to a 13% tax rate.
2. Income between RUB 2.4 million and RUB 5 million is taxed at 15%; 18%, 20% and 22% apply above RUB 5, 20 and 50 million.
3. A rate of 13% (15% above RUB 2.4 million) applies to property sales, pension, and insurance payments.
4. A flat PIT rate of 30% applies to non-residents in Russia for most of the incomes generated in this country, except dividends from Russian companies.
5. Highly qualified professionals in Russia are subject to a PIT of 13% or 15% rate respectively.

Persons interested in more details about Russia income tax rate can address their inquiries to our tax advisors in Russia.

Modifications on the tax legislation in Russia

The multilateral agreements for 27 double taxation treaties have been successfully implemented in Russia in 2020, entering into force in January 2021. There are other significant changes to the Russian tax regime:

1. The social contribution rates for small and medium companies in Russia were reduced to 15% (above the minimum wage) in 2020; since 2026 this reduced rate is kept mainly for manufacturing and other priority sectors.
2. IT companies in Russia are subject to a reduced CIT of 5% rate (since 2025) and, from 2026, a 15% rate for social contributions (7.6% above the cap) if special accreditations are obtained.
3. Starting with 2021, there is no VAT for software and database transfers and licensing.
4. The DTT amendments with Luxembourg and Cyprus were ratified, but Russia suspended key provisions of both treaties in August 2023 (Decree No. 585).
5. Tax exemption for 5-year ownership of shares and participation interest in Russian and foreign legal entities is available (since 2025 only to tax residents and capped at RUB 50 million of income per year).

If you need more details about Russia income tax, feel free to talk to our lawyers in Russia.

Special taxation for citizens from countries with visa-free regime 

Foreigners subject to the visa-free regime and working as home care assistance, gardeners, or having businesses based on work patents pay preferential tax at rates of 13% or 15% instead of 30%. This kind of taxation applies to citizens from countries like Belarus, Armenia, Kyrgyzstan, or nationals from Eurasian Economic Union. More about Russia income tax rate can be discussed with our Russian lawyers.

Making investments in Russia

Russia is a highly appreciated investment destination in the world and home to numerous companies established with foreign capital that enjoy the business benefits in this country. Those looking for investment advantages in Russia can discover the appealing environment that permits the fast registration of a company plus immediate development in sectors like oil & gas, tourism, agriculture, engineering, IT, energy, research, and development, in a risk-free climate. Russia is a leading oil and natural gas exporter, so investing in this field is extremely advantageous. We present you a few facts and figures that underline the business and economy of Russia:

1. Cyprus was the main investor in Russia in 2019, with more than 30% of the total FDIs being invested in the country.
2. Around USD 464 billion represented the total FDI of Russia in the same year.
3. The World Bank's last Doing Business report (2020, discontinued in 2021) ranked Russia 28th out of 190 worldwide economies in terms of ease of doing business.

Interested in more aspects of Russian income tax? You can contact our law firm in Russia and discuss further details.