According to Russian legislation, both foreign legal entities and individuals can create limited liability companies on the territory of the Russian Federation. At the same time, an LLC may be established by a foreign citizen independently or jointly with citizens of the Russian Federation.
The procedure for registering an LLC for foreign citizens almost completely coincides with a similar procedure for Russian citizens. The only difference in this case is the need for a foreigner to have a notarized translation of the passport into Russian.
Opening of LLC by a foreign citizen in Russia: procedure of actions
The issues of establishing an LLC are regulated by the provisions of the Federal Law “On State Registration of Legal Entities and Individual Entrepreneurs”. Foreign citizens planning to open an LLC in Russia do not need to have a work permit, a residence permit, as well as other permits. In addition, foreign owners of companies do not have to reside in Russia.
Before proceeding to the registration of documents for the registration of an LLC, a foreign citizen must:
A. Determine the address (location) of the company being created
This can be done both by independently concluding a lease agreement for non-residential premises, and by contacting a specialized firm that provides legal addresses for postal communication with the company.
B. Select a candidate for the position of head of the LLC being created
The head of the company, unlike the founder, is an employee: he is subject to the norms of Russian labor law.
It is important to consider that a foreign citizen can be appointed to the position of the head of an LLC in the same way as for any other position, regardless of whether he is the founder of this LLC. If a foreigner wants to become the CEO of an LLC on his own, he needs to have a work permit or a patent.
At the same time, according to the legislation of the Russian Federation, for the following categories of foreigners there is no need to obtain a patent or work permit in the Russian Federation when applying for employment in a Russian company:
- for foreigners who have a residence permit in Russia or a temporary residence permit in the territory of the Russian Federation.
- for foreigners who are citizens of the EAEU countries (Republic of Belarus, Kyrgyzstan, Armenia, Kazakhstan).
C. Choose the applicable tax system
An organization using the general taxation regime is obliged to:
- Keep accounting records.
- Submit accounting and tax reports to the inspectorate.
- Pay taxes – on value added (VAT) and on profit.
Special tax regimes are designed to make life as easy as possible for small businesses. And the simplified taxation system (STS) is the most common of the special regimes, since it replaces income tax, corporate property tax, and value added tax (VAT).
To apply the STS, the LLC being created should meet the following criteria:
- The share of participation of other organizations (including foreign ones) – no more than 25%.
- The income level should be no more than 200 million rubles. (3,371 mln EUR) per year.
- The average number of employees – no more than 130 people.
- The residual value of fixed assets – no more than 150 million rubles. (2.53 mln EUR).
- Does not engage in the types of activities listed in paragraph 3 of Article 346.12 of the Tax Code of the Russian Federation.
The next step in creating an LLC is to fill out the application form No. P13014. This form should contain information about the name of the company being created, its address, passport details of the founder, the head, as well as the intended activities.
Thus, the basic package of documents for opening an LLC by a foreigner is as follows:
- a copy of the passport of a foreign citizen.
- translation of the passport into Russian, certified by a notary.
- completed application form N P13014.
- charter of LLC.
- the decision to create a company.
- letter of guarantee with the address of the company’s location.
- receipt of payment of state duty.
- notification of the transition to a simplified taxation system (if necessary).
The registration period of the company will be 3 working days after the submission of documents to the authorized registration authority.
Registration of LLC by a non-resident of the Russian Federation without personal presence in Russia
LLC in Russia can be established by a foreigner remotely, without his direct presence. To register a company for a foreign citizen, it is necessary to sign an application in the form N P13014, as well as a power of attorney to represent interests in Russia.
These documents must be signed in the presence of an employee of the Russian consulate or a foreign notary. If the documents are certified by a foreign notary, an apostille must also be affixed.
It should be noted that documents made on the territory of a foreign state and drawn up in the language of the relevant foreign state must be accompanied by a translation into Russian certified by a Russian notary.
Our company specializes in advising foreign citizens interested in doing business in the territory of the Russian Federation. We offer comprehensive support for legal entities and individuals who want to register an LLC, help with the preparation of documents and their submission to the tax authority.
Contact us and we will advise you in detail at every stage of the LLC creation. We will prepare a package of documents; help you fill out the papers and submit them to the state authorities. We will also resolve any non-standard situations that may arise at the initial stage of creating a business in the Russian Federation, as well as in the future.