Russia: Clarification on new withholding tax rate applicable to some corporate bonds

18.08.2016

Further to our Taxflash T16028, dated 5 August 2016, Clearstream Banking1 would like to inform customers that further clarification has been received regarding the impacts of new Law No.242-FZ. Effective

1 January 2017

the withholding tax rate applicable to Russian corporate bonds will decrease from 20% to 15%, provided that the following conditions are met:

  • The bond must be issued by a Russian organisation;
  • The bond must be denominated in Russian Rubles (RUB);
  • The bond must be issued between 1 January 2017 and 31 December 2021 (both inclusive);
  • The bond is traded on an established securities market at the date when interest income on such bonds is recognised for tax purposes; and
  • The beneficial owner is a foreign or Russian legal entity.

Further information

For further information, please contact the Clearstream Banking Tax Help Desk or Clearstream Banking Client Services or your Relationship Officer.

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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking Frankfurt customers using CreationOnline), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.