How is dividend income taxed?
Individuals who are Russian residents pay
- NDFL personal income tax worth 13% of dividend income
- NDFL personal income tax worth 13% when selling shares. Income tax base is calculated as income from the sale of shares minus their purchase price.
Entities that are Russian residents and foreign companies operating in Russia through a permanent rep office pay
- income tax worth 13% of dividend income
- income tax worth 20% when selling the shares. Entities shall calculate and pay taxes on their own pursuant to Article 280 of the Tax Code of the Russian Federation.
Individuals that are non-residents in Russia pay
- dividend tax worth 15% of the dividend amount
- 30% tax on the sale of shares held by an individual.
Entities that are non-residents in Russia pay
- income tax on dividends, standing at 15% of the dividend amount. Reduced tax rates might apply when intergovernmental agreements to avoid double taxation are in place.
Legal entities that are non-residents in Russia do not pay income taxes when selling the bank’s shares.