- 10 July 2019
- Posted by: badamowicz
- Category: News
Opening a company and operating in Russia
Russia is a country open to foreign investment. Therefore, every foreigner can open and register a company in Russia. Below we present what features of the Russian economy and legislation should be taken into account when opening a company, and what are its advantages and limitations.
The benefits include:
– Recently, due to the current economic situation, there has been an outflow of foreign capital from the country. This significantly reduced competition on the market.
– A large base of raw materials
– A large target group. The population of Russia is huge and is approaching 150 million inhabitants.
– Quite low level of professionalism of Russian entrepreneurs. A foreign company can offer a better product / service, better service at a reasonable price and will be out of competition
– Low labor costs, especially in regions. Large varied remuneration
What is needed to open a company in Russia
To open a company in Russia, a foreigner must meet several conditions:
– Legally reside in the country
– Obtain registration documents at your place of residence or residence
– Get a work permit or patent if you plan to occupy a certain position in the company and do not have a temporary residence permit
– It is necessary to issue an identification code by tax authorities
– The Apostil and all notarial documents must be translated into Russian
Russian legislation provides foreigners with many forms of ownership. We suggest you consider the three most important of them:
- Individual activity. An individual person running a business without starting a business. This scheme is for running small businesses. The entrepreneur is personally responsible for all liabilities.
- A limited liability company. The company has a minimum share capital (paid in cash, the minimum share capital is 10,000 rubles). Limited liability, the founders are responsible only for the cost of shares in the share capital. After registration, such a company obtains the status of a legal entity with foreign capital, which extends to it all legal provisions (including security guarantees) regarding foreign investments.
- Joint Stock Company. The specificity of this company is that authorized capital becomes shares belonging to shareholders. Shareholders are responsible for the value of their shares and do not answer personally. This is usually intended for medium and large enterprises. This structural unit will not be an independent legal entity, but a separate department of a foreign company authorized to perform representative and business functions. At the same time, the opportunity to work in a branch / representative office appears only after accreditation.
Company registration in Russia
The company’s registration procedure will include the following steps:
– Choosing the name of the organization or company. The name must be unique, reflect the company’s operations and not contain the name of the federal authorities.
– Choosing a legal address. It may be in the company’s registered office, in the place of mass registration (for a fee) or in the place of residence of the founder.
– Selection of activities according to OKVED (All-Russian Classification of Activities).
– Determination of the share capital.
– Preparation of the founder’s decision or protocol from the founders’ meeting regarding the creation of the company.
– Preparation of the memorandum of the association, the statutory card and other founding documents.
– Preparation and submission of application P11001 for sending to the registrar, signed and authenticated by a notary.
– Payment of the state duty in the amount of 4000 rubles.
– Choice of the tax system.
– Verification, submission, signing and submission of documents to the office. The registration deadline is at least 3 days. In the case of a positive decision, the tax authority sends to the email address the applicant documents regarding registration in the USRLE (uniform register of legal persons) and proof of delivery to the tax authority and the statute together with the note.
– Opening an organization’s bank account, registering a legal entity in PFR (pension fund) and FSS (social insurance fund).
The process of creating and registering a company in Russia can last from 3 to 7 days. Mediation services for the help and establishment of a company in Russia cost from 400 EUR, depending on the form of ownership of the organization and the package of documents submitted for registration.
Taxes in Russia
Despite the statements of officials, the main part of the income from business in the Russian Federation goes to pay taxes. At the same time, many foreigners wonder how a non-resident can operate in Russia. In fact, the status of a non-resident founder only affects the receipt of a dividend. The company itself, despite foreign capital, will have a Russian residence. As a rule, such an enterprise pays:
- VAT -20% (in exceptional cases 10%)
- Corporate income tax – 20% rate
- Income tax on individuals – 13%
- Deductions for social and medical insurance – 302% of the wage fund
- Real estate tax – 2.2%
- Dividend tax – 15%