Russia Clarifies Taxation of Interest Paid by a Permanent Establishment to a Non-Resident Company

The Russian Ministry of Finance recently published guidance letter 03-08-13/62064 regarding the taxation of interest income paid by a Russian permanent establishment (PE) of a foreign company in favor of another foreign company, without a PE in Russia, that provided loans to the PE for the purpose of carrying out activities in Russia. The letter provides that in accordance with the current provisions of the Tax Code, interest payments in such cases are not subject to tax (withholding). Howeve…