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A law has been signed providing for the possibility of keeping the personal income tax benefit for the transfer of assets of a CFC to a controlling person.

Clause 60.2 of Article 217 of the Tax Code of the Russian Federation establishes a tax benefit for personal income tax, allowing individuals who are tax residents of the Russian Federation to transfer Russian assets that they own through their CFCs to themselves free of tax.

By the adopted law:

  • the above benefits have been extended until 2024;
  • for the purposes of exemption from personal income tax, it is possible to offset the assets ownership period in a CFC against the ownership period of such assets after transfer in the manner prescribed by cl 60.2 of Article 217 of the Tax Code of the Russian Federation.

Changes have also been made to the provisions establishing the conditions for applying the specified personal income tax benefit, and the specifics of applying the 0% rate to the tax base for income tax on transactions with shares (participatory interests in the authorized capital), taking into account the period of ownership of such assets.

Document: Federal Law No. 121-FZ of May 29, 2024 “On Amendments to Articles 217 and 284.2 of Part Two of the Tax Code of the Russian Federation.”