Russia Employee Food Allowances Subject to Payroll Tax

The Russian tax agency issued new mandatory guidance to warn employers that the employee food allowance is subject to payroll tax and mandatory social levies.

The requirement is to affect employers making food allowance payments to employees. In Letter No. BS-4-11/9257, released May 22, the Russian Federal Tax Service (FTS) clarified how employers should withhold and pay the applicable taxes and levies on behalf of employees. If employers make food allowance payments to employees, these payments are fully subject to the payroll tax as stipulated by Articles 41, 210, and 217 of the Russian Tax Code and the Russian Finance ...