17.09.08

In a letter dated July 18, 2008, the Ministry of Finance recently tried to clear up how taxes should be handled when an organization purchases services from a foreign entity and the transaction takes place on the territory of the Russian Federation, but the sum of the contract is written in foreign currency, and the date of payment does not correspond to the date the services are actually rendered.

The organization/tax agent is obligated to respond in the following manner: first, when purchasing services from a foreign entity that is not obligated to pay taxes in the Russian Federation, the organization becomes the tax agent and must pay the Value-Added Tax (VAT). The letter further states that the VAT tax base will be calculated on the date the foreign entity actually transfers the money. Second, the organization has the right to declare the VAT payment as a tax deduction, regardless of the date the services are rendered.

Moreover, there is no need recalculate VAT if the sum recorded on the date the services are rendered differs from that claimed previously as a result of fluctuating exchange rates.

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Source: Российский налоговый портал