21.10.08

Foreign exchange differences (whether positive or negative) that affect the repayment of debt and interest on debts issued in a foreign currency must be accounted for tax purposes. This is according to Letter # 20-12/063544 of Moscow Department of the Federal Tax Service (FTS) from July 4, 2008.

These must be accounted for as profits (expenses) on the debt or interest is paid according to the credit agreement, and/or on the last day of the accounting (fiscal) period, whichever comes first.

At the same time, it is important to remember that expenses incurred as interest on credit received in a foreign currency must be accounted for within profit tax calculations. This is according to Article 269 of the Tax Code. Moreover, expenses recorded in foreign currencies must be recalculated according to the official exchange rate established by Russia’s Central Bank for the day of the expense. 

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Source: Российский налоговый портал