Self-employment tax

Dec, 04 2018

According to International Monetary Fund research unofficial earnings in Russia make up more than 30% of country’s GDP. In order to get taxes on this amount of income, Russian authorities decided to introduce special tax regime for self-employed persons.

Tutors, housekeepers, babysitters, photographers and many others will be subjects to a new tax.

This tax will take force on January 1, 2019 only in 4 Russian regions, including Moscow. Tax rate will be 4% of income, if freelancer works only with individuals, and 6% of income, if services are provided to individual entrepreneurs and companies. In this case the self-employed are exempt from paying personal income tax and VAT.

New tax should be paid by persons whose income does not exceed 200 000 rubles per month. In case of getting incomes above indicated sum, person must register as individual entrepreneur

In order to pay this tax Federal Tax Service developed special mobile app “My Tax”, using which the self-employed can upload receipts for provided services, and at the end of the month tax authority will determine required payment by itself.

The following fines will be imposed for concealment of incomes: at the first violation – 20% of unaccounted income, in case of repeated violation – 100%. At the same time, there are no fines for self-employed persons if they refuse using this tax system.

Author of the article
Self-employment tax
Valentina Khlavich
Managing Partner
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