Indirect Tax

• Classifying rendered services under the rules for determining the place of sale of services for VAT purposes
• Assisting with VAT matters arising during import and export transactions, including those with EAEU countries
• Assessing whether a reduced VAT rate of 10%/0% or a VAT exemption can be applied
• Analyzing the VAT treatment of intragroup services
• Preparing a defense file in case VAT treatment changes
• Preparing a company’s accounting policies concerning VAT
• Determining the methodology of separate accounting for VAT
• Implementing a policy of tax risk checks of counterparties, including automated (for details, see Automation of counterparty tax risk checks. B1 TaX-Ray solution) 
• Methodological support for other VAT matters

If a company’s ERP system does not enable returns to be downloaded in XML format, we can offer our own VAT tool.

This automated VAT tool has been developed by B1 based on MS Excel, using macros and Visual Basic tools. It enables data from an entity’s accounting system to be converted into XML format.

The VAT tool is updated for changes in the VAT return form, its completion procedure and format.
 

The VAT tool’s core functions are:

• Importing data from external sources (standard XML or XLS reports generated by a company’s accounting systems)
• Checking the completeness and format of input data
• Preparing returns in XML and PDF formats (sections 1-7 of VAT returns)
• Generating a purchase ledger and sales ledger in MS Excel format consistent with the forms established by the related decree of the Russian Government

We can help to obtain a VAT refund and provide an extensive range of services, including: 

• Designing strategies, including analysis of the recoverability of VAT in specific cases, negotiating the period when VAT will be refunded (submitting an adjusted return or claiming a deduction in current VAT returns) and determining the amount of VAT refundable (full or partial refund)
• Preparing a defense file substantiating the claim for a VAT refund
• Checking documents substantiating the claim for a VAT refund prior to the submission of VAT returns stating the amount of VAT receivable
• Assisting during a desk audit (for more details, see Assisting during tax audits)
• Supporting a company during meetings with tax officials
• Preparing for tax control procedures
• Supporting a company during litigation (if needed)

We support our clients in the course of tax audits. 
 

Our services:

• Drafting responses to the tax authorities’ requirements (analyzing requirements, developing a methodological position, preparing claims and lists of documents)
• Analyzing documents required by the tax authorities (prior to submission)
• Assistance in communication with the tax authorities during audits (preparation for questioning, support during meetings with tax officials)
• Preparing objections to a report/decision of the tax authorities following a tax audit
• Representing a company’s interests in litigation

Transactions performed in member countries of the Eurasian Economic Union (EAEU) are regulated by Appendix 18 to the EAEU Agreement. 
 

We have extensive experience in advising on matters related to the application of EAEU tax law and are ready to assist you with the following:

• Determining the place of sale of services (including e-services) for VAT purposes under EAEU legislation
• Clarifying VAT and excise tax payment procedures based on the specifics of EAEU legislation
• Analyzing imports/exports from a VAT perspective in accordance with EAEU legislation 
• Analyzing the VAT implications of various transactions from the perspective of the national laws of EAEU member countries

Services provided by the customs regulation and global trade group are listed here.

• Analyzing services to determine whether they qualify as electronic/non-electronic services for purposes of Russian VAT 
• Assisting with matters related to the VAT payment mechanism when e-services are purchased from foreign vendors 
• Assisting with the registration/deregistration of foreign e-service vendors for VAT reporting purposes in the Russian Federation
• Assisting with tax payments for a foreign company, should a foreign supplier of e-services be unable to pay VAT on its own behalf (for details, see Assisting with tax payments for a foreign company)

We can assist with a corporate tax health check. Such checks are performed to identify tax risks and find possible options to optimize current VAT and income tax approaches (this service draws on other expert teams as well).

• Analyzing whether a company can use IT benefits, including exemption from VAT (determining whether it qualifies, assessing the risk of a business split, etc.)
• Assessing a company’s risk of losing IT benefits (upon liquidation, expansion of services provided, etc.) 
   

IT maneuver projects are delivered by a dedicated team.

B1 assists companies facing difficulties in remitting funds to pay taxes in Russia. This service is particularly beneficial for foreign companies registered as VAT payers in Russia.

TaX-Ray is a web application for automated review of counterparties to determine tax risks and document the process of counterparty selection.
 

In designing this solution, we used our own methodology based on a comprehensive analysis of clarification letters of the Russian Federal Tax Service and the Russian Ministry of Finance on the application of Article 54.1 of the Russian Tax Code, and based on seven years of court practice.
 

Advantages of TaX-Ray:

• Identifying and assessing the tax risks involved in cooperation with counterparties; documenting the process of counterparty selection
• Assigning weights to all risk factors based on a comprehensive analysis of court practice and clarifications by regulators
• Monitoring changes experienced by a counterparty on a daily basis
• Reporting on check results in a form that can be tailored to corporate requirements
• Developing recommendations on cooperation with counterparties in line with the standard of due care in conducting civil (economic) transactions