Under the law: a legal way to work in Russia

When you start working in a foreign country, it's important to make sure that you are not breaking its laws. In Russia, you just need to get the status of a self-employed person to work legally. In this article, we'll explain what this means and why foreign citizens need this status.

Citizens of Belarus, Kazakhstan, Armenia, and Kyrgyzstan can register as self-employed. When a person acquires this status, they become a taxpayer, have official income, and can use a large number of financial products.

Benefits of self-employed persons:

1. Legal work
2. Quick registration
3. Official confirmation of income
4. No reports
5. Low tax rates
6. RUB 10,000 tax deduction
7. It is possible to combine self-employment with regular employment.

To register as a self-employed person, one needs to:

• Earn no more than RUB 2.4 million per year
• Work alone, without hired employees
• Engage in the activities permitted for self-employed.

The law doesn't provide a specific catalogue of permitted activities, while the list of these activities is quite extensive.

Below is a list of some areas in which people can provide their services using the self-employed status:

Self-employed persons can't:

1. Sell excise goods and goods subject to mandatory labeling. These include alcohol, tobacco, gasoline, passenger cars, some types of apparel, footwear, perfume, jewelry, etc.
2. Resell any items that they didn't make themselves. For example, a self-employed person can't buy a ready-made toy and resell it, but they can sew it and sell it as a handmade item.
3. Extract and/or sell minerals, such as coal, oil, gas, sand, and lime.
4. Work under a mandate, commission, or agency agreement, that is, act as an intermediary and perform any actions for the benefit of another person for remuneration.
5. Rent out commercial real estate, sell real estate and vehicles.
6. Work as a courier and accept money from customers for the benefit of the seller of the goods. However, the courier can be self-employed if the seller of the goods provided them with an online cash register for settlements with customers, or if the customer paid for the goods in advance, and the courier just needs to deliver them.

In addition, notaries, bankruptcy commissioners, lawyers, and mediators can't be self-employed.

What do I need to get the self-employed status through the bank?

• Have a Russian taxpayer identification number, INN.
• Register as a self-employed person.

You can register using the My Business service in the Sberbank Online mobile app – it's easy:

1. Open the Sberbank Online mobile app on your phone.
2. Swipe down to the Services section on the main screen.
3. Sеlеct My Business and go through a simple registration process.

It will take a few minutes. After registration, you'll receive a text message from the bank from number or a push notification in the Sberbank Online app.

Taxes

Self-employed persons can work both with individual customers and corporate clients – legal entities and individual entrepreneurs. The tax rate varies and amounts to 6% for services provided to corporate clients and 4% for services rendered to individual customers.

Self-employed persons only pay taxes on income generated by their professional activity. If there was no income, there's no need to pay anything.

Self-employed persons are entitled to a RUB 10,000 tax deduction. This tax deduction is granted automatically and is spent gradually: the self-employed pay taxes at the rate of 3% (instead of 4%) or 4% (instead of 6%) until they've used up the deduction amount. You can't just get RUB 10,000 as a lump sum.

If you fail to pay the tax in due time, you'll be charged a penalty for each day in arrears. Foreign taxpayers don't need to file reports and tax returns to the tax authorities.

You can read more about this tax regime at http://www.sberbank.ru/ru/svoedelo/nonresident (this is a new page created especially for non-residents from EEU countries) http://www.sberbank.ru/ru/svoedelo/nalog.

Sberbank. General banking license No. 1481 issued by the Bank of Russia on 11.08.2015.

Online banking and the SberBank Online mobile app are available to holders of SberBank bank cards (except corporate cards) connected to the Mobile Bank text messaging service. Internet access is required to use online banking and the SberBank Online mobile app. No age limit applies to any information products. The SberBank Online mobile app is available for installation on iOS or Android mobile devices of Program Participants. Visit the Bank’s website www.sberbank.ru, contact a branch or call 900 for more information on online banking and the SberBank Online mobile app. Not for use by children (18+).