What changed in 2026
Russia’s Federal Tax Service identifies several significant 2026 changes affecting individual entrepreneurs and companies. The standard VAT rate increased from 20% to 22% for transactions subject to the new rate. Corresponding settlement rates also changed, including the rate calculated as 22/122% for VAT-inclusive amounts.
A second major change affects taxpayers using the simplified taxation system (USN). The revenue threshold for VAT exemption fell from RUB 60 million to RUB 20 million for 2026–2029. A taxpayer whose 2025 revenue exceeded RUB 20 million generally enters the VAT regime from 2026. If revenue exceeds RUB 20 million during 2026, VAT begins from the first day of the month following the month in which the threshold was exceeded.
Practical example
Assume an LLC using USN earned RUB 24 million during 2025. Under the 2026 rules, it should plan for VAT obligations from January 1, 2026. If the business instead earned RUB 18 million in 2025 but reaches RUB 21 million in August 2026, VAT obligations generally begin on September 1, 2026.
The company must consider whether to use a reduced VAT rate available under the applicable USN rules or move to the 22% rate with input-VAT deductions. The correct choice depends on the company’s customers, supplier base, cost structure, and ability to pass VAT through in prices.
Planning checklist
- Reconcile 2025 revenue before determining 2026 VAT status.
- Monitor cumulative 2026 revenue monthly rather than waiting for year-end.
- Review contracts that state prices as VAT-inclusive or VAT-exclusive.
- Update invoices, accounting software, price lists, and cash-flow forecasts.
- Model the effect of reduced VAT rates against the 22% rate with input deductions.
- Confirm the month in which VAT registration or VAT accounting begins after a threshold breach.
Strategic implications
Businesses selling mainly to VAT-registered customers may benefit from the ability to claim input VAT under the standard regime. Businesses selling to consumers or VAT-exempt customers may face greater price pressure because customers cannot recover VAT. A detailed margin analysis should therefore precede any election or pricing change.
The safest approach is to create a monthly tax dashboard showing revenue, taxable sales, input VAT, output VAT, and customer type. This allows management to identify a threshold breach quickly and avoid late registration, incorrect invoices, or underpaid VAT.