Tax Service of the Russian Federation wants to know about foreign bank accounts

Opening a bank account abroad is not simple (a foreign bank may refuse a non-resident for fear of being a participant in money laundering operations obtained illegally), but that is not all. All taxpayers are obliged to inform representatives of the Federal Tax Service of Russia about the availability of accounts abroad. This obligation is based on federal legislation (in particular, part 7 of article 12 of Federal law No. 173-ФЗ dated 10.12.2003) and Special Government Decree No. 1365, adopted in 2015.  

The state is engaged in currency regulation and wants to know, what funds and on which accounts are kept by Russian citizens and companies. Therefore, if the account is registered in a branch, opened by any Russian bank in another country, there is no need to report to the Federal Tax Service, this will be done by the bank itself.

What are the most important points in the legal regulation of this issue that you need to know and remember? First, it should be understood clearly that such an obligation is established for all residents. Moreover, the concept of "resident" in the law on currency regulation is somewhat different from the same concept in tax legislation. From 01/01/2018, all citizens are currency residents. They should inform the tax authorities, except the cases when a citizen of the Russian Federation spends less than 183 days for a year in his homeland. To inform about the availability of accounts abroad is a duty not only for Russian citizens, but also for foreigners, as well as stateless persons. According to the Tax Code of the Russian Federation, the payment of taxes is the duty of everyone who is in the country for more than 182 calendar days for one year (paragraph 2.Article 207). Second, the period for notification is one month, starting from the moment (date) of opening (or closing) of an account with a foreign bank. The similar situation is for the cases of changes in the details of such accounts. Citizens (and all persons who have a permanent residence or property), as a rule, submit such information at the place of residence (registration). All other persons may contact any representative office of the Federal Tax Service of their choice.

Third, the notification must be submitted in accordance with a special form (TDN 1120107). Since last year, it has become possible to submit notification in a simplified form. It means that there are several methods and formats for such a notification. You can come to the tax office in person and bring a signed document, you can send it through the post office with a notification, then to prove the date the letter was sent, if it is necessary. You can do it through the nalog.ru website - find the section “Life Situations” and send a notification, using an electronic signature. The last option is the best and the fastest.

The most important is that you need to notify not only about the opening, closing or changing the details, but also about the movement of funds. It is easier for individuals, they must do it before beginning of the summer. Individual entrepreneurs and legal entities have to do it quarterly. That will not be easy to forget about it because of the penalties. If individuals forget to report on time, they are to pay the fine of 1500 rubles, but the company will be fined for 100 000 rubles. If the individual will be consistently forgetting to pay, then he or she will pay a fine of 5000 rubles, and the company will pay a fine of 1 million rubles. Interest on the account (if any) in this case can be lost at all. So before opening a foreign account, you should carefully study the law or at least have an expert’s consultation.