Russia-Changes to B2B supplies of e-services
Since January 2017, supplies of e-services made to customers in Russia by non-established businesses have been subject to Russian VAT. However, until now, a distinction has been made between B2C and B2B supplies, with B2C supplies being subject to Russian VAT collected by the supplier, and B2B supplies being subject to the reverse charge, with the Russian customer accounting for VAT.
However, the Russian authorities have now amended their VAT legislation so that with effect from 1 January 2019, the reverse charge will not apply to B2B supplies of e-services, and the non-established supplier will need to charge Russian VAT on all supplies.
Affected businesses should take now action to ensure they are fully compliant from 2019.