• Service: Tax, Global Mobility Services, International Tax
  • Type: Regulatory update
  • Date: 7/14/2014

Russia - FATCA guidance from the central bank 

July 14: Russia’s central bank issued Bulletin No. 64 (1542) on 10 July 2014 concerning the rules for implementing the FATCA legislation.

Legislation to implement the FATCA regime in Russia was signed into law on 30 June 2014. Read TaxNewsFlash-Europe.

The bulletin from the central bank provides guidance with respect to the FATCA-implementing legislation.

Central bank’s guidance

According to a central bank’s release (Russian):

  • “Punitive withholding” within the Russian territory is not regulated.
  • The transfer of money collected under a withholding regime is not regulated and is not allowed.
  • The FATCA implementing law restricts the collection of information and reporting with respect to investment FFIs (foreign financial institutions).
  • The Russian “FATCA authorized body” can, within its discretion, restrict the reporting on certain banking clients. Financial institutions first must submit reports to the FATCA authorizing body and only then, if not prevented from doing so, may transmit these reports to the IRS.
  • The Russian FATCA authorized body can, at its discretion, limit application of the rules requiring a bank to end certain client or entity relationships. Financial institutions will have to submit any plans to end client or entity relationships in advance, before proceeding with such plans (assuming that the relationship-ending plans are not rejected).
  • The law restricts the collection and reporting of information with respect to certain U.S. taxpayers that are long-term residents of Russia.
  • The law does not provide for an account closure in order to maintain certain FATCA-related status (for example, a domestic FFI).

For more information, contact a KPMG tax professional in Russia:

Dmitry Chistov

+7 495 937 4428

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