Russia Issues Clarification on Taxation of Contractual Penalties Paid from Russia to Cyprus
The Russian Ministry of Finance published guidance on the application of the Russia-Cyprus tax treaty for the tax treatment of contractual penalties when paid by a Russian company to and Cypriot company.
Under Russian tax law, penalties for violation of contractual terms paid by a Russian company to a foreign company are considered Russian-sourced income and subject to taxation at source. How…
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