Trade, dear!

The Arbitration Court prohibited tax authorities from refusing to register individual businesses to non-Russian citizens

To work in Russia legally and pay taxes or to be outside the legal framework is not a question for most foreigners engaged in small business. For the majority of non-Russians, leaving business in an illegal position is obviously preferable: it’s not even a matter of taxes, but a reluctance to deal with the authorities that issue permits for business activities. However, Russian courts sometimes side with foreigners. Recently, the Federal Arbitration Court of the Northwestern District declared illegal the decision of the tax inspectorate to refuse registration as an individual entrepreneur to a non-citizen of Russia.

The current legislation has formally long allowed foreigners and stateless persons to start their own private business in Russia. With the introduction in 2004 of a simplified procedure for registering individual entrepreneurs, which reduced the list of documents for registering a business to a minimum, theoretically, it should have been easy for foreigners to obtain the status of an entrepreneur without forming a legal entity. Including refugees and even children over the age of 14.

Registration under the new rules for individual entrepreneurs is simple to such an extent that even a child can literally cope with it. In addition to the application to the tax office, you must submit three photographs, a passport, a receipt of paid state duty, and for children - notarized parental consent. Formally, Russian laws allow an Azerbaijani teenager of fifteen years old trading at the market to register his own business, legalize his business and pay taxes. However, in practice, it is not so easy for foreign entrepreneurs to “come out of the shadows” even if they want to. Tax inspectors still refuse to deal with non-Russians.

Last year, a certain Murmansk entrepreneur tried to register as an individual, and at the same time submitted an application to switch to a simplified taxation system. All documents were in order: an application with a notarized copy, information about the type of activity that he intended to conduct, a copy of his passport, a certificate of registration, a receipt for payment of state duty. The tax inspectorate denied him state registration due to failure to provide a stateless identity certificate. Apparently, this meant a document issued to a foreign citizen or stateless person to confirm permission for permanent residence on the territory of the Russian Federation and free exit.

The case went through arbitration in the Murmansk region and the appeal court. Moreover, in both cases, the courts sided with the entrepreneur, and it was the tax authorities who showed persistence. Finally, the district arbitration court decided that the registering authority does not have the right to require any documents other than those established by law during registration.

For the Murmansk entrepreneur, the matter ended in victory. However, not all foreigners are ready to prove their right to work in Russian courts. And the stubbornness of the tax inspectorates does not at all increase the already small number of legal foreign entrepreneurs in the country.

Irina SKLYAROVA