The KPMG experts acknowledge that Russian tax and civil legislation is constantly developing, so potential investors have to monitor both new legislative acts and court rulings. In the beginning of the report, the authors introduce measures for encouraging innovation and modernization in Russia’s economy, such as Special Investment Contracts (SPIC) and Regional Investment Projects (RIP), stressing their benefits for investors as well as required obligations.

Asserting that investors often face the problem of deciding which legal structure to choose for their business in Russia, the authors describe the most common legal structures, namely businesses conducting direct sales, distributorship contract businesses, representative offices or branches, Russian subsidiaries. Then, the authors outline procedures for registration of a legal entity, liquidation, and reorganization, and give an overview of labor regulations in Russia.

After that, the KPMG experts proceed to describe the principles and the current state of Russia’s tax system. The issues touched upon include a new approach to identifying unjustified tax benefit, current rules for imposing profits tax, property tax, withholding income tax, etc. The authors remind that the Tax Code provides special tax regimes under which a taxpayer is entitled to pay one single tax instead of numerous different taxes, and go on to explain the simplified taxation system, unified agricultural tax, unified tax on imputed income, etc.

In the last sections of the publication, the authors give a brief description of the principles of financial reporting and accounting in Russia, and clarify other financial aspects that might be interesting to potential investors.