Russia moves to monitor peer-to-peer bank transfers for undeclared income
Russia’s Finance Ministry has proposed requiring the Central Bank to give the Federal Tax Service information about individuals “whose account transactions show signs that they regularly receive income from other individuals.”
The ministry proposed the amendment ahead of the second reading of a bill in the budget package, Interfax reported. The relevant State Duma committee plans to consider it on November 15.
Under the proposal, the Bank of Russia would analyze transactions in individuals’ accounts and pass information to the Federal Tax Service if it found signs of “receiving income from other individuals.” The tax service could then request statements for those accounts from banks.
The criteria for identifying signs of “regularly receiving income from other individuals” would be set separately, along with the format and frequency of the Central Bank’s reports to tax authorities.
Tax inspectors can currently request bank statements for individuals who are not registered as sole proprietors only if authorities have issued a decision to collect a tax debt or a tax audit authorized by a higher tax authority is underway. The Finance Ministry’s proposed amendment would add a new basis for such requests: information from the Central Bank.
In March, Vedomosti reported that the Finance Ministry was drafting amendments to tighten scrutiny of transfers between individuals. Under the ministry’s plan as reported at the time, the Federal Tax Service would obtain information from banks about individuals’ account openings and closures, their bank cards, and their income categories, then pass it to the Central Bank. The Bank of Russia would compare that information with the individuals’ transactions to identify anomalies.
The Finance Ministry said the change was needed because transfers between individuals are often treated as “gifts” and go untaxed, even though some may in fact be payments for real transactions, such as services or apartment rentals.
Russian taxes and bank accounts
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