Ministry of Finance explains new tax on deposits

The new tax on income earned from bank deposits and securities will affect only those Russians whose assets exceed RUR 1 mio ($12,670), the Ministry of Finance clarified quoted by TASS.

On April 1, Russian President Vladimir Putin signed a federal law introducing the new tax. Earlier, the head of state proposed this idea in his address to the nation on the coronavirus pandemic. The bill was submitted to the State Duma in 24 hours and adopted in three readings at once.

The Ministry explained that such taxes are levied in most countries. Russia will now levy a 13% tax on the aggregate interest earned on deposits with Russian banks minus the non-taxable income.

This non-taxable income is RUR 60K ($760). That is, if the income is RUR 80K ($1K), the 13% tax will apply to RUR20K, explained tax expert Nikolai Yepikhin, director of the Uproshchyonka (‘simplified taxation system’) website. This tax will not apply to payroll accounts.

 “The deposit itself will not be taxed, as before,” the expert emphasized.

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