Worried about your company incorporation in Russia?
Setting up your business overseas, especially in a dynamic country like Russia, can be quite overwhelming. There’s an endless list of requirements to be taken care of. The task can be streamlined and simplified with the help of accounting and other crucial service providers. Company incorporation in Russia is beneficial owing to its strategic geographical location and business opportunities.
Strong and reliable consultancy services in Russia can help you in the initial and later stages of business building. A firm providing consultancy, banking, and accounting services can smoothen the procedure of setting up a company in Russia.
Setting up your business overseas, especially in a dynamic country like Russia, can be quite overwhelming. There’s an endless list of requirements to be taken care of. The task can be streamlined and simplified with the help of accounting and other crucial service providers. Company incorporation in Russia is beneficial owing to its strategic geographical location and business opportunities.
Strong and reliable consultancy services in Russia can help you in the initial and later stages of business building. A firm providing consultancy, banking, and accounting services can smoothen the procedure of setting up a company in Russia.
Business landscape of Russia
Russia is home to 147.2 million people, making it the ninth-largest nation in the world as of the 2021 census). Russia saw a strong 4.7% economic growth in 2021, providing new companies with a promising and exploratory business opportunity in the country.
Given that Russia's GDP represents 1.31% of the global economy, many profitable business options exist for Indian Corporations. Indian corporations are increasingly entering the Russian market to diversify beyond traditional markets, tapping into Russia's resource-rich territories for energy, minerals, and metals. Strengthening diplomatic and trade relations, they pursue strategic partnerships in technology, infrastructure, pharmacy, automobile industry, and consumer commodities. Opportunities in infrastructure development, technology collaboration, and consumer goods expansion drive Indian firms to engage in joint ventures and investment initiatives.
Leveraging Russia's robust technology sector, India seeks collaborations to enhance technological capabilities. Geostrategic considerations also play a role, aligning India's interests with maintaining strong ties with Russia, fostering regional stability and enhancing economic cooperation while leveraging each other's strengths for mutual benefit.
Benefits of starting a business in Russia
Russia offers an excellent set of benefits to corporations set in the country. The top five benefits that attract corporations to Russia are as follows:
Low Tax Rates:
Russia offers one of the lowest tax rates to corporations on the continent. Thus, there is a considerable influx of direct investment in order to save money on taxes by functioning in Russia. This is one of the primary reasons for the establishment of multinationals in Russia.
Expansion:
Russia has 11 time zones across the entire continent. Establishing a company in Russia strengthens your plans for growth without too dispersing your offices throughout the country.
Level Of ownership:
Russia permits foreigners to acquire 100% of a firm. As a result, the business becomes a Russian legal entity, allowing you to eventually own your business there even though you are a foreign national. Most other countries do not offer this convenience.
Speed:
Russia has one of the quickest processes for LLC or company registration with individual entrepreneurs, making business there even more manageable.
Diversification:
Diversifying your business operations by entering the Russian market can help mitigate risks associated with relying solely on domestic markets or other regions, spreading your business's risk across multiple markets.
Important points to remember when registering and operating a Russian LLC Parent Company:
- 100% ownership of the Russian LLC by an entity, which itself has a single 100% shareholder, is not allowed (a second shareholder is required on either level) General Director
- The LLC must appoint a general director. A foreign citizen can be a general director, and a work permit is required in this case Legal address
- It is mandatory for every company in Russia to have a registered legal address
- The legal address is the primary address required to communicate with authorities
- An LLC cannot be registered when it has no or a fake legal address Statutory accounting.
- Each operation must be supported by a formal (set of) source document(s)
- These documents must be signed and stamped by the parties involved in the transaction
- Documentation, accounting, and reporting must be executed in the Russian language
- All standard reporting is also required if the company has no activities
Consultation services needed when starting a business in Russia
When deciding upon company incorporation in Russia, you need to seek the advice of a consultancy services provider who can assist you in navigating the complex maze of local regulations, tax laws, business strategies, etc. Here are some relevant consultancy services you can expect from a firm other than crucial banking and accounting services in Russia.
Legal Consultation:
You can expect reliable legal advice from the consultancy firms that guide you on the legal requirements for company incorporation, including the variety of company entities available and the related legal procedures:
- Payrolling/Outstaffing
- Representative office (RO)
- Branch Office (BO)
- Legal Entity (LLC)
Corporate Structure Advice:
Assistance in determining the optimal corporate structure based on your business objectives, ownership preferences, and the nature of your activities in Russia. Proper corporate structure is crucial to avoid complications in the future when the business goes up and running.
Tax Consultation:
Guidance on the Russian tax system, including corporate income tax, value-added tax (VAT), and other relevant taxes. Advising on tax planning strategies to optimize your company's financial position.
Financial Consultation:
Financial advice related to accounting practices, reporting requirements, and compliance with financial regulations in Russia.
Labor Law and Employment Consultation:
Guidance on Russian labor laws, employment contracts, and HR practices. This may include information on hiring procedures, employee benefits, and compliance with labor regulations.
Customs and Import / Export Consultation:
Assistance with understanding customs regulations, import/export procedures, and compliance with international trade laws. This is particularly relevant for companies involved in cross-border trade.
Intellectual Property Consultation:
Advice on protecting intellectual property rights in Russia, including trademark registration, patent protection, and strategies to safeguard your company's intellectual assets.
Real Estate and Location Consultation:
Guidance on selecting a suitable location for your business operations, understanding real estate regulations, and assistance with leasing or purchasing commercial property.
Final Thoughts:
Setting up a company incorporation in Russia takes up a lot of research and groundwork. Working with a consultation service provider by the side can help take a lot of things off your plate. Company incorporation in Russia can get a lot easier with the assistance of an accounting services provider that specializes in handling the aspects related to it.
