Long-term ownership relief: paying no tax without arranging anything in advance
beginner
Automated material · TradeAlmanac editorial deskPrepared by a language model from our stored data and checked by an editor.
The most underrated tax relief in Russia: it requires no special account, no application in advance, and places no restriction on withdrawals.
The condition
Continuous ownership of a security for at least 3 years. The security must trade on an organised market; the relief also covers units of open-ended funds run by Russian management companies.
The size
Gains are exempt up to RUB 3m for each full year of ownership. Five years of holding means five times the cap.
For a private investor with an ordinary portfolio that usually amounts to full exemption.
What the relief does not tolerate
Selling. The period counts continuously; sell a security and buy it back and the clock resets. That is exactly why frequent portfolio churn costs more than the commissions suggest: it also forfeits the relief.
How to claim it
Notifying the broker at the point of sale is usually enough — it applies the deduction as withholding agent. If the securities were transferred between brokers, the acquisition date has to be evidenced with documents from the previous one.
Compared with an IIA
An IIA gives more and demands a term plus a restriction on withdrawals. Ownership relief gives less and demands nothing but patience. They combine — on different accounts and for different money. See The third-generation IIA: what it gives and what it restricts and Investor income tax: what is taxed and when it is withheld.
Sources
- https://www.consultant.ru/document/cons_doc_LAW_28165/
Prepared by a language model from our stored data and checked by an editor.
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