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05/12/2025
Friday
THIS DAY IN HISTORY:
5 December 
1936 The Stalinist Constitution of the USSR was adopted.
1936 the Stalinist constitution of the USSR was adopted.
1484 Pope Innocent VII initiated the "witch hunt".
1456 An earthquake that destroyed Naples occurred - 35 thousand people died.
1456 occurred an earthquake that destroyed Naples - 35 thousand people died.
5 December
1936 The Stalinist Constitution of the USSR was adopted.
1936 the Stalinist constitution of the USSR was adopted.
1484 Pope Innocent VII initiated the "witch hunt".
1456 An earthquake that destroyed Naples occurred - 35 thousand people died.
1456 occurred an earthquake that destroyed Naples - 35 thousand people died.
THE SUPREME COURT SUPPORTED THE FEDERAL TAX SERVICE IN A DISPUTE WITH YANDEX OVER INCOME TAX
Yandex Corporation has lost a legal dispute with the Federal Tax Service (FTS) regarding the accounting procedure for the construction of a new office center in Moscow. The country's highest court, the Supreme Court of the Russian Federation, refused to transfer the company's cassation appeal for consideration, thereby upholding the decisions of the lower courts (case no.A40-63845/2024).
The reason for the proceedings was the demolition of the former Korston Hotel, acquired by the company along with the land plot in 2018. Having vacated the territory in 2020 for the construction of a new complex, Yandex reflected in the updated tax return for 2021 the residual value of the dismantled structures as non-operating expenses. This operation would allow the organization to reduce its income tax payment by approximately 1.7 billion rubles.
However, the Federal Tax Service did not agree with this approach. The tax authorities considered that the liquidation of old buildings is not an independent economic action, but represents an integral stage of a single investment project for the construction of a new office. Therefore, all related costs, in the opinion of the service, should be capitalized, that is, included in the initial cost of the new facility and transferred to expenses through the depreciation mechanism.
Initially, the Moscow Arbitration Court confirmed the correctness of the Federal Tax Service, and later the appellate and cassation instances. The judges unanimously supported the position of the tax authorities, pointing out that the costs of demolition are part of the construction investment and cannot be written off at one time.
As for the new complex on Vorobyovy Gory, it will consist of three buildings of different heights (a maximum of 15 floors), which will combine a common atrium with a glass roof. The planned total area of the premises will be about 162 thousand square meters.
Photo: Freepik
The reason for the proceedings was the demolition of the former Korston Hotel, acquired by the company along with the land plot in 2018. Having vacated the territory in 2020 for the construction of a new complex, Yandex reflected in the updated tax return for 2021 the residual value of the dismantled structures as non-operating expenses. This operation would allow the organization to reduce its income tax payment by approximately 1.7 billion rubles.
However, the Federal Tax Service did not agree with this approach. The tax authorities considered that the liquidation of old buildings is not an independent economic action, but represents an integral stage of a single investment project for the construction of a new office. Therefore, all related costs, in the opinion of the service, should be capitalized, that is, included in the initial cost of the new facility and transferred to expenses through the depreciation mechanism.
Initially, the Moscow Arbitration Court confirmed the correctness of the Federal Tax Service, and later the appellate and cassation instances. The judges unanimously supported the position of the tax authorities, pointing out that the costs of demolition are part of the construction investment and cannot be written off at one time.
As for the new complex on Vorobyovy Gory, it will consist of three buildings of different heights (a maximum of 15 floors), which will combine a common atrium with a glass roof. The planned total area of the premises will be about 162 thousand square meters.
Photo: Freepik
23.10.2025
