Exporting services from Russia? New procedure for VAT payment

As of July 1, 2019, the procedure for payment of incoming VAT for Russian companies selling services abroad will change. This will particularly affect the sale of marketing, advertising, and consulting services. This amendment was made to the Russian Tax Code regarding VAT on services where the place of sale is not the Russian Federation. Services provided by a Russian company to foreign companies are still not subject to VAT.

What has changed?

The changes occurred in terms of accounting for incoming VAT on services rendered outside of Russia. Starting from the 3rd quarter, instead of taking into account the amounts of input VAT in the profit tax expenses, it will be possible to accept them for deduction. In cases with large volumes of input VAT on these services, it can be profitable and worth the additional attention to the documentation.

How will this affect your company?

These changes are likely to lead to more thorough checks of Russian companies from the tax authorities. They will scrutinize the application of the provisions of Article 148 of the Tax Code regarding the availability and quality of contracts and documents confirming the provision of services. An example of these documents are acts and reports on rendered services.

In this regard, we recommend Russian taxpayers analyzing the sufficiency of documentation, as well as preparing for desk audits, which are almost a certainty for VAT refunds in practice.


In case you have any doubts regarding the sufficiency of the documentation of VAT-exempt services, you can contact SCHNEIDER GROUP specialists for advice and analysis of the supporting documents. SCHNEIDER GROUP also can support you during tax audits and represent your interests to the tax authorities.

US Tax Form 1040
Our experts
Alex Stolarsky
Partner, Rechtsanwalt, Legal & Compliance, Moscow
+7 / 495 / 956 55 57
Ekaterina Lakatosh
Senior Tax Expert
+7 / 495 / 956 55 57
Olga Lux
Senior Tax Expert
+7 / 812 / 458 58 00