Taxation of a Latin American company in Russia: rates, outbound payments, treaties

What is happening

The Russian LLC of a Mexican group is paying dividends for the first time. The accountant is about to withhold at the standard rate, while the group expects the reduced treaty rate and does not know which documents are required before payment.

A Peruvian company will receive royalties for its trademark from a Russian distributor. Russia has no tax treaty with Peru, so before the licence is signed the tax the Russian side will withhold should be estimated and built into the price.

An Argentine company has sent an employee to Moscow who negotiates and signs contracts without any LLC or branch. It needs to assess whether this creates a permanent establishment in Russia.

What the law says

• An LLC receives its taxpayer number (INN) and registration code (KPP) on state registration; the specific rules for registering foreign organisations, including branches and representative offices, are set by the Federal Tax Service (Articles 83 and 84 of the Tax Code).
• Corporate profit tax is charged at the standard rate of 25% (Article 284(1) of the Tax Code); VAT at the standard rate of 22% from 1 January 2026 (Article 164(3) of the Tax Code as amended by Federal Law No. 425-FZ of 28 November 2025).
• On income of a foreign organisation not connected with a permanent establishment in Russia, the Russian tax agent withholds tax at the standard rate of 25% (Article 284(2)(1) and Articles 309 and 310 of the Tax Code); dividends paid to a foreign organisation are taxed at 15% unless otherwise provided (Article 284(3)(3)).
• A reduced treaty rate applies where the recipient has confirmed its permanent location in the treaty state and its beneficial ownership of the income (Article 310(2)(4) and Article 312 of the Tax Code).
• According to the Russian Ministry of Finance as of 14 July 2026, double tax treaties are in force with Argentina, Brazil, Venezuela, Cuba, Mexico, Chile and Ecuador; there are none with Colombia, Peru, Nicaragua or Bolivia. The treaties with Mexico and Chile are also covered by the Multilateral Instrument (MLI).
• Presidential Decree No. 585 of 8 August 2023 suspending certain provisions of Russia's international tax treaties affected treaties with states committing unfriendly acts; none of the treaties with Latin American countries has been suspended.

What we do

• We identify which taxes the LLC or branch pays and where the Russian side has tax agent obligations.
• We map payments to the parent company (dividends, royalties, interest, services) and calculate withholding tax on each under the Tax Code and under the treaty.
• We check whether there is a treaty with the recipient's country and whether its relief applies to the specific income; we quote a rate only after reading the treaty text.
• We prepare the package for the reduced rate: an apostilled and translated tax residence certificate, confirmation of beneficial ownership and a timetable for obtaining them before payment.
• For Mexico and Chile we factor in the MLI principal purpose test.
• We assess the risk of a permanent establishment where employees of the foreign company work in Russia without an LLC or branch.
• We respond to tax authority requests concerning payments to foreign persons.

What we will need from you

• A group chart and a list of payments from Russia to foreign persons.
• The contracts behind the payments: licences, loans, services, dividend resolutions.
• Details of the recipient: country of incorporation, tax residence and who actually controls the income.
• The recipient's tax residence certificate, if already available.
• Contact details of the accountant keeping the books of the LLC or branch.