Tax resident: the concept and criteria for determining

A tax resident is a subject of taxation. Its status is determined by the principle of residence (permanent residence), under which all taxpayers are divided into individuals who are residents and non-residents of the country. The assignment of a payer to one of the named categories determines its tax status and corresponding responsibilities (full or partial responsibility), as well as other differences in taxation (the procedure for making funds, declaring income, etc.)

The rules for determining residency are different for individuals and legal entities.

A tax resident is an individual who permanently resides in the Russian Federation. This applies equally to both foreigners and stateless persons who are actually in its territory no less than 183 days during the year (this can be either one or several periods).

The status of the residence in the Russian Federation is established annually. There are cases when for its definition only the criterion of temporary stay in the country is not enough. Then some additional signs are used, such as the location of the permanent home, personal and economic ties, citizenship, etc. As a result of applying these criteria, which are established by the legislation of the Russian Federation and international agreements, the state is determined where the person lives more. Then the tax and financial authorities put it on record as a resident of their country.

A legal entity as a tax resident is determined on the basis of tests such as the incorporation test (depending on the country in which it is based), the legal address, the location of the central control and management, the location of the current management of the company, the business purpose.

Tax residents must make payments to the budget of the country to which they relate according to the status defined by legislation (ND) for them. For each person (individual) this question is of principle, because he depends on him, what tax should be paid - 13% (for a resident) or 30% (for a non-resident), since the difference in the amount is quite substantial.

To determine the status of citizenship does not matter. This takes into account the 12-month period, which can begin in one calendar year, end in another. The 183-day period is calculated by adding the calendar days (including the day of arrival and departure from the RF) within 12 consecutive months. Determine the final status of the taxpayer can only be at the end of the calendar year.

The status of an individual "tax resident" has its own characteristics. Those who do not pay them personal income tax only on income that they received only from Russian sources. The determination of their status is made anew on each payment date. Return of overpaid money on personal income tax (if any) can be made only after the end of the period (calendar year) and only through the tax authorities (inspection). This category of payers is not subject to the rules of standard, property and social tax deductions.

The term "tax resident" of the year has changed somewhat since 2007. If before that a resident of the Russian Federation was recognized as a person who is at least 183 days in a calendar year, now they are recognized only by persons who have been this amount of time for 12 consecutive months. Such changes were made to close the "hole" in the legislation, because virtually all individuals on January 1 of each subsequent year lost their resident status

You can confirm the status of a resident with the help of any document certifying the fact of being on the territory of the Russian Federation for more than 183 days. This can be documents (passport) with a mark on entry to the territory of the Russian Federation, tickets, visas with marks, documents of registration at the place of temporary residence.