Towards the end of 2017, a number of exciting developments unfolded in our field. In December the Russian tax authorities have published a long-awaited list of countries with which automatic exchange of information would start in 2019 for the reporting year 2018, for example, Switzerland. Importantly, with some countries, for example, Lichtenstein, Singapore and the UK, this exchange of information will start in 2018 for the reporting year 2017.

A number of further amendments to the Russian Controlled Foreign Company (“CFC”) legislation were introduced. The aim of the amendments is to regulate practical issues which became apparent recently including calculation of profits from operations with financial assets and utilization of losses of CFCs.

Deduction of cost of assets received by Russian tax residents in the course of tax-free liquidation of CFCs is now ensured for a number of cases such as inheritance, donation, redemption of securities etc. Together with expected prolongations of tax-free liquidations such amendments make tax-free liquidation of CFCs even more attractive.

Starting from the 1^st January 2018 the definition of Russian currency control residency is amended. The starting point is that everyone who holds Russian citizenship is a currency control resident. However, the persons who are not the Russian tax residents in a calendar year are free from the key currency control obligations: notification of the Russian tax authorities of opening accounts in foreign banks, limitations on allowed transactions on such accounts and also annual reporting on operations on such accounts. Although there is a number of practical questions on the new rules, the changes are definitely positive for Russian citizens living abroad. For persons which are covered by the above obligations, the list of allowed transactions is extended to income from disposal of foreign listed securities (subject to particular limitations) starting from the 1^st January 2018.