The Federal Tax Service's 2025 Black and White Lists: 5 Key Changes

Contents:

• FTS Black and White Lists: Key Aspects
• Updates to the FTS Black List: Changes from 2025
• The Impact of the Black List on International Companies and Offshores
• Updates to the FTS White List: Key Changes in 2025
• The Impact of the White List of Countries on Foreign Bank Accounts
• The Impact of Changes to the FTS Lists on Controlled Foreign Companies (CFCs)
• How to Minimize Risks and Avoid Fines When Working with Offshore Accounts and CFCs in 2025

Black and White Lists of the Federal Tax Service: Key Aspects

The black and white lists of the Federal Tax Service (FTS) of Russia play a key role in international tax and currency control. These lists help identify jurisdictions with which Russia can establish effective cooperation in the exchange of financial information. Black lists include countries with high tax risks, while white lists contain countries that meet transparency and integrity criteria. The use of these lists helps improve tax administration and minimize the risks of tax evasion.

The blacklist includes countries that do not provide the Federal Tax Service with the requested information on tax residents. This may be due to the absence of tax information exchange agreements or a low level of transparency in their tax systems. In contrast, the whitelist consists of jurisdictions that have established automatic exchange of taxpayer data. This significantly facilitates the process of monitoring compliance with tax obligations and promotes greater transparency in international financial transactions.

The Federal Tax Service (FTS) updates the lists annually, based on current data from international information exchange. This update allows Russian tax authorities to adjust their strategies and approaches in line with changes occurring on the global stage. Such measures contribute to the effectiveness of tax control and ensure compliance with international standards.

Controlling persons of controlled foreign companies (CFCs) and account holders outside of Russia should closely monitor changes in the blacklists and whitelists. The presence of a country on these lists can significantly impact tax liabilities, reporting requirements, and the use of offshore accounts. Timely updating of information is key to avoid negative consequences and ensure compliance with the law.

For a deeper understanding of the issues related to controlled foreign companies (CFCs), as well as the obligations of their owners to the Russian tax authorities, I have prepared a detailed article. It covers in detail the key aspects of CFC taxation, as well as tax payment deadlines, which will help company owners avoid mistakes and optimize their tax liabilities. The article contains up-to-date information necessary for compliance with the law and effective tax risk management.

Updates in the FTS blacklist: changes from 2025

On December 31, 2024, the Order of the Federal Tax Service dated October 30, 2024 No. ED-7-17/914@ came into force, which significantly changed the composition of the blacklist of countries. These changes have a significant impact on the tax policy of the Russian Federation and create new conditions for interaction with foreign jurisdictions. The updated blacklist of countries may affect many aspects of international business and taxation, making it important for companies and entrepreneurs to monitor current changes in tax legislation.

The updated blacklist now includes not only traditional offshore zones and developing countries, but also economically developed countries. The list includes all countries of the European Union, as well as countries such as Australia, Monaco, Liechtenstein, and New Zealand. This change emphasizes a global approach to combating financial fraud and tax evasion, making the issue of transparency and tax compliance relevant in international practice.

The reason for this decision was the cessation or restriction of the exchange of financial information between these countries and Russia. As a result, Russian tax authorities are losing the ability to obtain data on taxpayers registered in these jurisdictions. This could lead to a reduction in tax revenues and complicate tax compliance.

The appendix to the order provides a complete list of countries and territories blacklisted by the Federal Tax Service (FTS) of Russia. This list includes jurisdictions that do not exchange information with the Russian Federation for tax purposes. This blacklist is important for taxpayers and entrepreneurs, as it can significantly affect taxation and financial transactions with these countries.

The presence of bilateral or multilateral cooperation agreements with Russia does not automatically remove the country from the blacklist. The Federal Tax Service (FTS) emphasizes the actual exchange of information between states, not just the existence of formal agreements. This means that for successful cooperation, not only a legal framework is important, but also real-world practices of interaction in the area of ​​data exchange and tax control.

Given recent changes, Russian companies and taxpayers need to closely monitor legislative and tax initiatives to avoid negative consequences. For up-to-date information, it is recommended to consult official sources, such as the Federal Tax Service of Russia and the Official Internet Portal of Legal Information. These resources offer timely updates and clarifications on current tax legislation, which will help companies remain legally compliant and effectively manage their tax obligations.

The Impact of the Blacklist on International Companies and Offshores

Being blacklisted by the Federal Tax Service (FTS) of Russia significantly complicates tax planning and reporting for controlled foreign companies (CFCs) registered in such jurisdictions. In this article, we will analyze in detail the key consequences of this status, including changes in taxation, reporting requirements, and potential risks for businesses. We will also consider how companies can adapt to the new conditions and minimize the negative effects of being blacklisted.

Limiting tax benefits for controlled foreign companies (CFCs) on the FTS blacklist results in their loss of the opportunity to enjoy tax benefits established by the Tax Code of the Russian Federation. This primarily affects the exemption from corporate income tax, as well as the abolition of benefits for licensed banks, insurance companies, and bond issuers registered in these jurisdictions. These restrictions may significantly impact the financial activities of such companies and their tax burden. Mandatory audits are becoming mandatory for companies included on blacklists. Such organizations must submit an audit report along with their financial statements when submitting documents to the Federal Tax Service (FTS). This requirement serves to confirm the accuracy of financial indicators, particularly profit amounts, even if the statements are prepared in accordance with the current legislation of the country of registration. An audit provides an additional level of transparency and trust in a company's financial data. The issue of double taxation is relevant for investors receiving dividends from Russian companies registered in blacklisted countries. In cases where companies distribute dividends to Russian individuals, a complication arises: taxpayers cannot reduce their personal income tax (PIT) by the amount of profit tax already withheld in Russia. This increases the overall tax burden on investors and reduces the attractiveness of investing in such companies. Resolving this issue requires careful tax planning and studying international double taxation treaties.

Updates to the Federal Tax Service White List: Key Changes in 2025

The new Federal Tax Service White List, approved by Order of the Federal Tax Service of Russia dated October 30, 2024, No. ED-7-17/916@, will come into force on December 31, 2024. This document represents a significant step towards simplifying tax interactions with foreign countries, which may lead to an improved business climate and increased investment. The new white list will simplify the tax accounting process for companies operating internationally and create a more transparent environment for cooperation between countries.

The updated white list of countries with which Russia conducts automatic exchange of financial information has reduced the number of partners. The list now includes Armenia, Cameroon, Rwanda, Jamaica, and the territory of Niue. At the same time, 26 member states of the European Union have been excluded from this list. These changes may impact international financial transactions and tax cooperation, which is important to consider when planning business activities and investments in these countries.

For a complete list of countries and territories included in the Federal Tax Service (FTS) white list, we strongly recommend that you read the appendix to the relevant order. This will help you obtain up-to-date information on countries that meet the FTS criteria and may be useful for your tax calculations and planning.

Automatic exchange of financial information is carried out through standardized protocols and systems that ensure data security and confidentiality. This process involves the collection, processing, and transfer of information between government agencies and financial institutions. The main goal is to simplify tax administration and combat tax evasion.

Modern technologies, such as blockchain and data encryption, play a key role in ensuring the reliability of exchange. Participants in the process, including banks and tax authorities, use specialized software solutions to automate the collection and transfer of information. This reduces data processing time and minimizes the risk of errors.

It is important to note that the automatic exchange of financial information is regulated by international standards, such as CRS and FATCA, which are aimed at increasing the transparency of financial flows and preventing tax violations. These measures contribute to strengthening international cooperation in the field of tax information and ensure compliance with legislation in different countries.

Thus, the automatic exchange of financial information is an effective tool for enhancing tax compliance and ensuring financial transparency at the global level.

The automatic exchange of financial data is carried out within the framework of the Multilateral Competent Authority Agreement (MCAA) and the Common Reporting Standard (CRS), developed by the Organisation for Economic Co-operation and Development (OECD). These mechanisms are aimed at increasing the transparency of financial transactions and combating tax evasion. Participation of countries in the automatic exchange of data allows for the effective tracking of financial assets and accounts, minimizing the risk of tax violations and ensuring compliance with international standards.

During the information exchange, tax authorities of participating countries annually provide standardized data on taxpayer accounts. This information includes data on the account holder, bank, account number, as well as the account balance and income, including interest. This exchange helps increase the transparency of tax systems and combat tax evasion.

The automatic exchange of information includes account data for both individuals and legal entities, as well as information on controlling persons of foreign companies. This process ensures the transparency of financial transactions and helps combat tax evasion. Automated exchange allows tax authorities in various countries to obtain the information they need to effectively monitor compliance with tax legislation.

The Impact of the White List of Countries on Foreign Bank Accounts

The White List of the Federal Tax Service (FTS) is an important tool for Russian residents planning to open foreign bank accounts. Using accounts in banks not included in this list may have serious legal and financial consequences. It is recommended to familiarize yourself with the current list of banks in advance to avoid the risks associated with tax audits and possible sanctions. Choosing the right bank outside of Russia, one included in the Federal Tax Service's white list, will help minimize problems and ensure compliance with the law.

According to Article 12 of Federal Law No. 173-FZ of 10.12.2003 "On Currency Regulation and Currency Control," Russian residents have the right to deposit funds without restrictions into accounts in foreign banks located in countries included in the white list. This provision offers significant advantages for both business and personal finances. The ability to freely deposit funds contributes to improved financial planning and the optimization of foreign exchange transactions, which, in turn, contributes to increased international competitiveness and expanded investment opportunities.

If a resident has a bank account in a country that is not included in the white list, they may face certain restrictions on receiving funds from non-residents. These restrictions may include difficulties with transfers, increased payment processing times, and the need to provide additional documents to confirm the source of funds. As a result, residents risk facing a slowdown in financial transactions and possible financial losses.

• income from the sale of property;
• payment for work performed or services rendered;
• dividends, coupons and income from securities transactions;
• loans and other receipts prohibited by currency legislation.

If funds are received into an account from a country that is not on the white list, it is possible to avoid liability for violating currency legislation. To do this, it is important to transfer the funds to an account in a Russian bank within 45 calendar days of their receipt. Compliance with this deadline will minimize risks and ensure compliance with legal requirements.

In the current environment, when many banks restrict financial transactions with Russia or are subject to enhanced scrutiny, this method may be ineffective. Transfers can often be delayed in foreign banks, and there is no guarantee that the funds will reach the Russian bank within the established time frame. This creates additional risks for clients and may impact financial planning. It's important to consider these factors when choosing money transfer methods to minimize the likelihood of delays and inconvenience.

Failure to comply with currency regulation rules can result in significant fines, ranging from 20% to 40% of the amount of the illegal currency transaction. Using bank accounts in countries not on the white list is associated with high risks and requires careful monitoring. To avoid financial losses and legal consequences, it is important to carefully analyze and evaluate all aspects of currency transactions, as well as consult with professionals in the field of financial and tax law.

The Impact of Changes in the Federal Tax Service Lists on Controlled Foreign Companies (CFCs)

Recent changes to the black and white lists of the Federal Tax Service (FTS) have a significant impact on the operations of controlled foreign companies (CFCs). It is important to understand how these changes may affect business processes and the financial results of companies.

For example, an increase in the number of companies on the black list may limit access to tax benefits and lead to additional tax audits. On the other hand, being whitelisted may open up new opportunities for businesses, such as simplified reporting procedures and reduced tax risks.

By analyzing these changes, companies should adapt their tax management and compliance strategies to minimize potential negative consequences and seize new opportunities.

A Russian businessman owns a controlled foreign company registered in Austria. Due to Austria's recent blacklisting by the Federal Tax Service, the businessman lost the right to apply the effective tax exemption for controlled foreign companies. This highlights the need to regularly monitor the status of tax jurisdictions to prevent financial losses and optimize tax liabilities.

An individual resident of Russia controls a company in Germany, which participates in a Russian company. When paying dividends according to the scheme "Russian company → German company → individual in the Russian Federation," the last element of the chain will not be able to account for the tax previously withheld in Russia, which effectively leads to a situation of double taxation. This creates additional tax risks for residents who control foreign companies and requires careful tax strategy planning to minimize financial losses.

A Russian resident has a bank account in Switzerland. After Switzerland was removed from the Federal Tax Service's whitelist, transfers to this account from non-residents may result in fines for violating Russian currency legislation. This situation highlights the importance of carefully selecting jurisdictions to optimize financial transactions and minimize risks. Residents should be aware of legislative changes and monitor current requirements to prevent undesirable consequences.

A Russian resident has a registered company in the United States. Due to the fact that the United States is on the Federal Tax Service's blacklist, starting in 2025, notifications of controlled foreign companies (CFCs) will need to include not only financial statements prepared in accordance with local standards, but also an auditor's report. The introduction of this requirement obliges entrepreneurs to more carefully prepare documents and take into account new tax control conditions. Keeping up with changes in the Federal Tax Service (FTS) lists is crucial for successful business. Adapting business processes to new rules helps minimize the risk of tax consequences and penalties. Timely measures to update information and revise internal procedures will help maintain financial stability and avoid unpleasant situations with regulatory authorities. Regularly monitoring changes in legislation and their impact on your activities will significantly improve the effectiveness of tax risk management. How to minimize risks and avoid fines when working with offshore accounts and CFCs in 2025 Managing offshore accounts and controlled foreign companies (CFCs) is associated with a number of risks. To minimize fines and legal consequences, it is important to adhere to the following recommendations. First, ensure full compliance with your country's laws and international regulations. Regularly update your tax obligations and reporting information. Second, choose reliable partners and consultants experienced in offshore management. This will help avoid mistakes and misunderstandings. Additionally, monitor changes in tax legislation to adapt your management strategies. It's also helpful to regularly audit your offshore assets and companies to identify potential risks early. A systematic approach to managing offshore accounts and CFCs will minimize risks and ensure the legality of your actions. Check current Federal Tax Service lists. Before opening a new offshore account or registering a CFC, ensure that the chosen jurisdiction is not blacklisted by the Federal Tax Service. Having an account in a whitelisted country allows you to legally receive funds from non-residents of Russia. Comply with currency laws. It's important to monitor authorized transactions and avoid illegal transfers to foreign accounts, which can result in significant fines. Transfer funds to Russia promptly. If your account is blacklisted by the Federal Tax Service, transfer receipts to a Russian account within 45 days to avoid sanctions for illegal currency transactions. Monitor your tax residency status. Restrictions on the use of foreign accounts do not apply to individuals who are outside the Russian Federation for more than 183 days a year, which may be relevant for frequent travelers. Monitor changes in legislation. Regulations and Federal Tax Service lists are subject to change, so regularly check for up-to-date information and adjust your actions if necessary. Consult with professionals. Given the complexity of legislative changes, it is recommended to consult with experts in international tax planning before conducting important transactions with CFCs or offshore accounts. By following these recommendations, you can successfully manage your international business while complying with Russian legislation. For more detailed information on tax matters and current legislative changes, we recommend visiting official websites, such as the Federal Tax Service and the Checkpoint. These resources provide up-to-date information and helpful tips for entrepreneurs to help them avoid legal issues and optimize their tax obligations.