Industries

• Employees involved

  Mikhail Begunov, Nikita Zharov

• Process description

  The client planned to restructure intragroup indebtedness totalling more than RUB 42bn. The transaction was complicated by tax risks, as well as restrictions imposed by currency and sanctions regulations.

• Result

  The Tax Compliance team analysed currency and tax legislation as well as their application, including issues related to repatriation of funds under loan agreements, tax consequences of assignment of rights, transfer of debt, thin capitalisation rules for leasing companies and application of provisions of double taxation avoidance agreements.
  
  As a result of the project, Tax Compliance team managed to offer the client a way of carrying out a business transaction which would meet the requirements of currency legislation as well as be the least exposed to the risks of tax legislation violation (including debt transfer between the Group companies / forgiveness of debt in the framework of economic relations between the "parent" - "subsidiary" companies).
  
  In addition, the Tax Compliance team was able to identify areas of tax efficiency improvement in relation to the proposed transaction, in particular, it proposed a method of transaction that allowed avoiding tax payments under thin capitalisation rules.

• Employee involved

  Alexey Stanchin

• Process description

  The tax authority in the framework of an on-site tax audit came to the conclusion that the taxpayer used technical links for the purposes of obtaining tax profits on VAT and income tax. In particular, the tax authority believed that: (1) in fact the provision of services took place directly from organizations that apply special tax regimes (without VAT); (2) the taxpayer and the counterparty are related business entities. In view of the above, the taxpayer was invited to dispute the technical nature of the disputed counterparties. The Tax Compliance team helped the client to elaborate a legal position which confirmed: (1) lack of controllability between the participants of the contractual relations chain; (2) economic feasibility of the transaction; (3) the reality of financial and economic activities of the disputed counterparties.

• Result

  The tax authority accepted the arguments of the taxpayer

• Employees involved

  Mikhail Begunov, Ivan Tsvetkov, Nikita Zharov

• Process description

  The Tax Compliance team was given the task of analyzing the tax risks associated with the procedure for taxing the income of individuals working outside of Russia.

• Result

  The Tax Compliance team has identified the areas most exposed to tax risks and prepared recommendations for improving document management (in terms of processing the client's labor relations with employees working outside of Russia) based on the results of the analysis.

• Process description

  The client requested to analyze the current structure of interaction within the framework of aircraft charter contracts. The consultant was assigned the task to analyze tax risks and identify ways to minimize them. (The project was implemented by the employee before joining Tax Compliance)

• Result

  As a result of the work done by the consultant was able to change the contractual structure, which allowed to minimize the risks of the client associated with the application of 0% VAT rate and others.

The client was rendered support services in the frame of on site tax audit, objections to the act of tax audit, additional materials of tax control were prepared, the basis for the recovery of taxes was the assumption of the tax authority of the technical links for the purpose of obtaining deductions for VAT and income tax.

• Purpose

  Confirm the actual provision of transport and freight forwarding services rendered to the client, to apply the reconstruction of transportation services, to confirm the absence of a scheme to obtain an unjustified tax benefit

• Employee involved

  Alexey Stanchin

• Process description

  An on-site inspection was carried out in respect of the client, as a result of which additional VAT and income tax were charged on relations with controlled transit counterparties. According to the tax authority, the purchase of goods was actually carried out directly from organizations that apply special tax regimes (without VAT). As part of the legal defense developed a legal position to challenge the technical nature of the activities of the disputed counterparties, for part of the episodes was applied to the reconstruction of the income tax.

• Result

  According to the results of the developed legal position it was possible to prove the lack of controllability between the participants in the chain of contractual relations, to confirm the economic feasibility of the transaction, as well as the reality of the financial and economic activities of the disputed counterparties.

A transportation company sought advice on assessing tax risks in a transaction involving the sale of interest-bearing bonds.

• Purpose

  Structuring of tax risks and minimization of possible tax claims

• Employee involved

  Mikhail Begunov

• Process description

  A client engaged in helicopter transportation rendered consulting services for the analysis of tax risks in a transaction involving the sale of interest-bearing bonds, which resulted in a loss. Due to the fact that the securities are not traded on the organized securities market and were sold to a related party, there was a risk of additional profit tax charges when accounting for expenses on the purchase of securities.

• Result

  Implementation of the project made it possible to eliminate the probability of tax claims

The airline sought advice on the assessment of tax risks in the restructuring of debt on purchased discounted borrowings.

• Purpose

  Exclusion of tax claims from the tax authorities, structuring the transaction according to the model of issuing preferred shares by the company and the possibility of applying Article 277 of the Tax Code when offsetting obligations.

• Employee involved

  Mikhail Begunov

• Process description

  A client of a major airline company was advised on analyzing tax risks associated with the purchase of discounted debt from credit institutions and the offsetting of debt obligations against securities.

• Result

  Legal position aimed at justification and structuring of the transaction allowed the client to exclude the possibility of tax claims on income tax, as well as to take into account the losses of previous tax periods in the expenses.

The tax authority's position on the application of price adjustments between parties to a financial and economic transaction has been appealed as part of the tax audit of transfer pricing.

• Employee involved

  Mikhail Begunov

• Process description

  Price adjustment would have entailed an additional charge of income tax on the formed tax base based on the market prices of the transaction. The project developed a legal position indicating that the formed pricing corresponds to the market level, because the calculation of the cost of the taxpayer's goods contains production costs, economically justified in terms of the type of activity.

• Result

  As a result of the successful legal defense, additional tax assessments in the amount of 280 million ₽ were avoided.