From July 01, 2010 the procedure for employing highly qualified foreign specialists in Russia will be considerably simplified. Previously, foreign nationals could obtain a work permit for a year regardless of their qualifications. Now, highly qualified foreign specialists may obtain a work permit and a work visa for up to 3 years. Moreover, companies will no longer need to apply for permits to hire and quotas to employ highly qualified foreign specialists. This will significantly reduce the time required to obtain work permits for highly qualified specialists and will do away with prior filing of applications for quotas for such persons for the following year. Previously, to employ foreign nationals, companies had to apply for quotas regardless of the foreign nationals’ qualifications before May 01 of the year prior to the foreign nationals’ employment and had to specify the position of the specialists to be employed, as well as their country of origin. To employ foreign nationals, companies also had to advertise job vacancies at the Employment Center, apply for permits to hire foreign employees and provide authorities with documents confirming that foreign nationals’ qualifications were in line with the position advertised. Now, to employ highly qualified specialists, companies only have to obtain a work permit and a work visa, while companies themselves determine whether the specialists’ qualifications suit the positions to be filled.

The law provides for only one criterion defining foreign nationals as highly qualified specialists. This criterion is the annual salary paid by a Russian employer, which should amount to at least 2 million rubles per annum (approximately EUR 50,000).

Companies employing highly qualified specialists must report quarterly to the Federal Migration Service their salaries, granted leave/vacation and termination of employment agreements. Companies must also obtain voluntary medical insurance policies for such specialists.

Residence Permit

After obtaining a work permit, highly qualified foreign specialists may apply for a residence permit in Russia for the whole duration of their employment agreement. A residence permit allows foreign nationals to travel to and from Russia without a visa and to have a permanent registration in Russia. This means that the companies employing foreign nationals with a residence permit do not need to register and de-register such foreign nationals every time they leave or come to Russia.

Tax status

Highly qualified specialists will pay income tax at a rate of 13 % on the income derived from working as highly qualified specialists as soon as they receive their work permit. Previously, regardless of their qualifications, such foreign specialists had to pay income tax at a rate of 30% up to when they obtained their status of tax resident in Russia, i.e. after a stay of at least 183 days in Russia over 12 consecutive months. Companies employing a highly qualified foreign specialist must also provide information on the tax registration of the specialist in Russia. For this purpose, the specialist is therefore required to file a registration application with a tax office in Russia.

Employees of representative offices of foreign companies

From July 01, 2010 foreign nationals employed by accredited representative offices of foreign companies in Russia will not need to obtain work permits and work visas. The body registering foreign companies’ representative offices in Russia should, however, approve the number of such foreign nationals. It is important to note that foreign nationals employed by branches of foreign companies may not work in Russia without a work permit.

Should you require any further details, please let us know. We are looking forward to assisting you in obtaining work permits, registering with tax authorities, as well as with any other matters.

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