In 2025, a tax amnesty will start for companies that have used a split. Alexey Stanchin, Head of Tax Compliance practice, in the material of Pravo.ru analysed the forthcoming changes and highlighted the key points that businesses will need to take into account. 

Tax amnesty for business splitting is a mechanism of termination of tax liability arising for tax periods 2022-2024, related penalties and fines in terms of offences related to the fact of business splitting. 

The TC expert notes that the introduction of the term ‘business splitting’ even for the purpose of applying the amnesty again forced to return to the discussion of this concept. It is not worth talking about the existence of an exhaustive list of criteria at the moment. It is important to remember that even their presence does not automatically indicate abuse of the taxpayer, because when considering this category of disputes are investigated the business purpose of the creation or use of companies. 

At the same time, after the adoption of the tax reform, the Federal Tax Service considered it necessary to generalise court practice on business splitting. In the letter, the agency indicated the signs, in the presence of which the courts take the side of the regulator in a dispute about the unlawful division of business. 

In the review, Alexei highlights a number of key issues in which tax experts can help: 

• Assessing the need for and compliance with amnesty conditions. 
• Choosing the right regime from 2025. 
• Changing the structure and internal business processes. 
• Structuring transactions involving the transfer of fixed assets and inventory. 

The TC lawyer also warns that among tax inspections there is sometimes a controversial interpretation of the provisions of the amnesty application. Some inspectors suggest that the beneficiary of a group should submit revised declarations from one person with the amounts of revenue of the entire group for 2022-2024. This is not recommended. The actions of inspectors are explained, presumably, by the desire to show performance, which affects the performance of a particular inspectorate in assessing the performance at the end of the year, but has nothing to do with the legislative regulation of the provisions of the amnesty for business splitting. 

Our experts have previously written more about the tax amnesty for business splitting.