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Inclusion of a foreign company in the SME register: benefits for small and medium enterprises, conditions and procedures

Publication date/update: 27.02.2023
The SME register (full name – the unified register of small and medium enterprises) is a database that includes information about organizations and individual entrepreneurs that fall under the criteria of small and medium-sized businesses. The register is regularly updated by the Federal Tax Service of Russia. The data is available for viewing on the agency's website.

The status of the subject is established under the provisions of Art. 4 of Federal Law No. 209-FZ of July 24, 2007. According to the amendments dated December 1, 2018, companies with a share of foreign capital of more than 49% can apply for SME status on an equal basis with other Russian enterprises. Below is the information about what a foreign company needs to be included in the SME register and what benefits it can receive.

What are the requirements for foreign companies to be included in the SME register?

Enterprises with foreign capital may enter the SME register subject to certain conditions that impose restrictions on total income, number of employees, and location of foreign investors.


Total income: the income from economic activity cannot exceed two billion rubles. The information is provided for the previous calendar year.


The number of employees: the average number of employees for the reporting period should not exceed two hundred and fifty people.


Location of foreign investors: foreign investors who have a share in the equity capital of the company must be registered outside the offshore zones. The list of such zones is established by the Order of the Ministry of Finance No. 108n dated November 13, 2007, as amended on October 2, 2014.

If the share of foreign capital does not exceed 49%, the last requirement is no longer valid, and the organization can get into the SME register on general terms.

Why does a foreign company need to confirm the status of a small or medium enterprise?

Inclusion in the SME register gives a foreign company many advantages that can significantly simplify accounting, reduce the tax burden, and receive support from government agencies. In particular, small and medium-sized businesses are allowed to:


apply special tax regimes;


maintain simplified accounting, tax, and statistical records;


use concessions when paying for privatized properties;


reduce insurance contributions to the Pension Fund, Social Insurance Fund, and Medical Insurance Fund;


receive a deferment on tax payments and insurance premiums (when operating in areas affected by the pandemic).

This is not a complete list of privileges that small and medium enterprises with foreign capital can expect if operating in Russia. Municipal authorities also provide consulting, legal, and financial assistance to small and medium-sized businesses with additional benefits in some regions.

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How to get into the Unified Register of SMEs?

The Federal Tax Service updates the information in the SME register every year from 1 to 5 July. The database is compiled using data for the past year. According to Article 4.1 (Clause 6.2) of Federal Law No. 209-FZ, audit organizations included in the register of auditors provide information about foreign legal entities for compiling the Unified Register of SMEs.

Thus, to get into the Unified Register of SMEs, a foreign company must initiate an external audit, which can be conducted by independent audit organizations. The audit regulations are explained in the information letter of the Ministry of Finance of the Russian Federation No. IS-audit-26 dated January 15, 2019.

After agreeing with an audit company, its employees check the reporting of a foreign company for compliance with the SME criteria. Based on the results of the audit, the auditors draw up a conclusion and provide information to the Federal Tax Service, which includes the enterprise in the Unified Register of SMEs.

Please note that the register is formed from July 1 to July 5. Therefore, it is necessary to initiate an audit immediately after the formation of the annual financial statements so that the auditors have time to draw up a conclusion and send the data to the Federal Tax Service.

Answers to frequently asked questions

What information is reflected in the Unified Register of SMEs?

The Unified Register of Small and Medium Enterprises includes information not only on the category of the enterprise but also on the types of activities, products manufactured, valid licenses, participation in public procurement, and other data. Complete information is available in Part 3 of Article 4.1 of Federal Law No. 209-FZ of July 24, 2007.

How often do you need to confirm the SME status of a foreign company?

Information in the SME register is updated every year, so it is necessary to annually provide data to the Federal Tax Service. If a company ceases to meet at least one of the stated criteria, it will lose its SME status.

Does the FTS verify the accuracy of the information provided?

There is no specific verification procedure. Small and medium-sized businesses are solely responsible for providing false information. To eliminate the possibility of errors in tax reporting and avoid penalties, it is better to entrust the verification and transmission of information to qualified auditors.

How to check if a company is included in the SME Register?

All information on the SME Register is publicly available. You can check whether an organization is included in the register in the appropriate section on the website of the Federal Tax Service.

Can a company add information about itself to the Unified Register of SMEs?

Yes, a company can register the information that it thinks is needed to develop business, for example, specify an e-mail, website, phone number, place information about goods and services, experience in contractual obligations, and participation in affiliate programs.

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