In connection with regularly received inquiries concerning the procedure for taxation of money received by individuals from individuals, the Federal Tax Service of Russia in Letter No. BS-16-11/33@ dated 11.02.2025 provided official clarifications.

Under Article 209 of the Tax Code of the Russian Federation (hereinafter – the “TC RF”), the object of personal income taxation is income received by a taxpayer.

In accordance with paragraph 1 of Article 41 of the Tax Code of the Russian Federation, income is an economic benefit in cash or in kind, taken into account if it can be assessed and to the extent that such benefit can be assessed, and determined, in particular, in accordance with Chapter 23 “Personal Income Tax” of the Tax Code of the Russian Federation.

The list of income not subject to personal income tax is set out in Article 217 of the Tax Code.

Letter No. BS-16-11/33@ dated 11.02.2025 states that, in particular, according to paragraph 18.1 of Article 217 of the Tax Code of the Russian Federation is not subject to personal income tax income in cash and in kind, received from individuals as a gift, except in cases of gift of immovable property, vehicles, shares, digital financial assets, digital rights, including simultaneously digital financial assets and utilitarian digital rights, digital currency, shares, units, unless otherwise provided by this paragraph.

According to the norms of current legislation, monetary funds received by individuals from individuals free of charge, including by bank transfer, are not subject to personal income tax.

As noted by a representative of the Federal Tax Service of Russia, “the mere fact of a bank transfer of funds between individuals is not an object of taxation”.

This position confirms the previous approach of the Federal Tax Service set out in Letters of the Federal Tax Service of Russia N 03-04-07/41782 dated May 31, 2021 and N 03-04-05/12443 dated 10.12.2024.

It should also be noted that there is a closed list of income received from individuals which is exempt from personal income tax under certain conditions.

These include, in particular, the following (according to paras. 5, 13, 15, 15, 17, 17.1, 18.1 of Art. 217 of the Tax Code of the Russian Federation; Letter of the Ministry of Finance of Russia dated 31.05.2021 N 03-04-07/41782, sent by Letter of the Federal Tax Service of Russia dated 02.06.2021 N BS-4-11/7663@):

  • alimony received;
  • income from the sale of livestock and crop products grown in private subsidiary farms on the territory of the Russian Federation;
  • income from the sale of harvested wild fruits, berries, nuts, mushrooms and other edible forest resources (edible forest resources), non-timber forest
  • resources for own needs;
  • income from the sale of furs, meat of wild animals and other products obtained in the course of recreational and sport hunting;
  • from the sale of immovable property, as well as shares in such property, subject to the specifics established by Article 217.1 of the Tax Code of the Russian Federation;
  • from the sale of other property owned by the taxpayer for three years or more;
  • income in the form of cash received as a gift.

Thus, the emergence of the object of taxation for personal income tax on the receipt of a money transfer from an individual to an individual depends on the purpose of the payment.

At the same time, under certain conditions, as noted in Letter No. BS-16-11/33@ dated 11.02.2025, monetary funds received on the account of a taxpayer who is an individual, for example, as payment for property sold or, for example, as remuneration for services rendered, are recognized as income of such an individual subject to personal income tax in accordance with the statutory procedure.

It should be recalled that as of 01.01.2026, amendments to Articles 86, 132, 135.1 and 135.2 of the Tax Code of the RUB, which relate to the digital ruble and oblige the operator of a digital ruble platform to report to the Federal Tax Service information on the opening and closing of digital ruble accounts, will come into force as provided for by Federal Law N 610-FZ dated 19.12.2023. Penalties are provided for violation of the obligations. Thus, the digital ruble is effectively subject to the same rules as ordinary bank accounts.

One of the advantages of the digital RUB will be the ability to track the entire chain of transactions in which each digital RUB was used.

Reference: Letter of the Federal Tax Service No. BS-16-11/33@ of 11.02.2025 On personal income tax on transfers of money between individuals

Personal income tax PIT