Relevant changes on the form of notification about real estate by foreign legal entities

According to Article 374 of the Tax Code of the Russian Federation, those foreign entities that are legal entities and those foreign entities that have not registered a legal entity while being owners of immovable property that is taxed must send the following data to competent authorities in due form:

1. The first is a correctly completed tax declaration on relevant property of an enterprise.
2. The second is a list of documents that we will consider in detail later.

It is necessary for foreign companies and foreign organizations, that have not incorporated a legal entity and which own taxable real estate in accordance with regulations of RF, to inform about their beneficial owners, management and founders. Form, format, procedure for filling in this information electronically were normatively fixed by the Federal Tax Service of Russia in the Order №MMV-7-14/41 of January 28, 2016 regarding the structure of notification about the participants of the foreign enterprise, as well as its founders, beneficial owners, management, who owns the property, which, according to the norms of the Russian Federation, is subject to taxation. Moreover, this notification is filed electronically.

Being filled in electronic form, this notification must be provided as of the last day of a calendar year of specified tax period. It requires disclosure of certain procedure for indirect involvement of an individual, if any, or a public enterprise, if its direct or indirect involvement in a foreign organization is more than five percent of total percentage. The foregoing is normatively fixed by the third paragraph of Article 386 of the Tax Code of the Russian Federation, and this norm extends its legal validity to all transactions/deals that were concluded from January 1, 2015.

Proceeding from the foregoing, the first reports or notifications of foreign legal entities and persons without formation of a legal entity were filed along with declarations for the last year and reports on real estate of enterprises for relevant tax period.

TIN and TRC of a foreign legal entity, which have been assigned by a tax authority to which this information is provided, are indicated on the top of a sheet of the form of notification.

The first sheet should contain:

• revision number of a notification;
• reporting code;
• code of a tax authority at the location of a property.

The second sheet should contain:

• data on a foreign structure, which does not have a registered legal entity;
• organizational form of an enterprise, be it a trust, a fund, or, for example, a partnership;
• it is necessary to indicate full, not abbreviated, name of a foreign organization in Russian and Roman alphabetic form;
• state code;
• date of establishment of an enterprise and other necessary data.

A foreign organization must fill a certain sheet of new form about number of its participants. In the event that there is a need to provide information about a participant, you must proceed to the following:

• foreign company should fill in sheet A;
• Russian company - sheet B;
• an individual - sheet C;
• a foreign enterprise without formation of a legal entity - sheet D;
• in sheet E, it is necessary to indicate procedure for indirect involvement of an open type enterprise, participation of its individual in a foreign company;
• sheet F must be filled out by a foreign company without forming a legal entity, where it is necessary to provide information about its beneficial owners and managers, and therefore an individual, a subject of Russian or foreign company.