All about innovations in the Russian Federation from 1 January 2024

On 1 January 2024, some changes will come into force in Russia that will affect various areas of citizens' lives.

Changes in the tax system

From 1 January 2024, two personal income tax notices will need to be provided on a regular basis. The reporting deadlines are as follows:

• A notification in respect of personal income tax withheld from the 1st to the 22nd day of the current month must be submitted by the 25th day. Tax must be paid by the 28th of the month.

• A report on personal income tax withheld from the 23rd day to the last day of the previous month must be submitted by the 3rd day of the following month. Tax must be paid by the 5th of the month.

The changes do not affect personal income tax amounts withheld from 23 to 31 December. Employers still need to pay these amounts by the last working day of the year.

The second innovation concerns remote workers. From the beginning of 2024, the income of such employees working abroad will be treated as income received from sources in the Russian Federation.

It is important to note that we are talking about employees with whom an employment contract has been concluded which also states that the place of work is outside Russia. Consequently, from next year, tax on the income of remote employees living abroad will be calculated at the standard rate of 13% or at 15% if the income exceeds 5 million per year.

Holidays according to the production calendar 2024

• On 23 February, Russians will rest for 3 days (from Friday to Sunday);

• On International Women's Day, 8 March, the holiday will also last 3 days (Friday to Sunday);

• "May Holidays" will last 8 days: from 28 April to 1 May, and from 9 to 12 May;

• Wednesday, 12 June, will be a day off in honour of Russia Day;

• Russians are also waiting for a holiday from 3 to 4 November in honour of the Day of National Unity;

• The New Year holidays will start on 29 December.

Matkapital (Mother's capital)

From 1 January 2024, maternity capital will be paid only for children who have obtained Russian citizenship at birth. Previously, parents who came from abroad and received a Russian passport also received money.

Driving licence

From 1 January, the rules for driving schools and for drivers who have obtained a licence in another country will become stricter. Driving licences of Russians issued in another country will be invalidated (except for citizens of the Republic of Belarus who have a residence permit in Russia). The same measure will be applied to foreigners who obtained a residence permit or Russian citizenship more than a year ago. They will be forced to take the exams again.

Increase in the minimum wage

From 1 January 2024, the minimum wage will be indexed by 18.5%. The indexation rate will exceed the inflation rate for 2023.

Raising the minimum wage has an impact on wages in the country, but it only affects workers in low-wage jobs. Employers cannot pay employees less than the minimum wage, so those who receive less than this amount will receive a pay increase from 1 January. Currently, about 2.5 per cent of workers are paid minimum wage or less.

Chairman of the State Duma Vyacheslav Volodin, commenting on the law, noted that the increase in the minimum wage by 18.5% from 1 January 2024 was ordered by President Vladimir Putin. "An important decision that will protect people, raise real incomes. As a result of the implementation of this order, wages will increase for 4.8 million people," Volodin said

Compensation for sick leave is calculated as a certain percentage of the employee's average salary for two years, and its amount depends on the length of service:

• Up to five years' service: 60 per cent of average earnings;

• 5 to 8 years of experience: 80%;

• Experience of more than eight years: 100%.

If the length of service of the insured person is less than six months, the sick leave benefit is calculated on the basis of the minimum wage. Therefore, the minimum amount of sick leave benefit for one day will be:

• RUB 641.4 if the employee is sick in a month with 30 days;

• RUB 620.7 in a 31-day month.

First mortgage instalment

From 1 January, the minimum down payment on mortgages will be 30%. This amount must be paid by the borrower in order not to apply surcharges on mortgages granted to citizens with a debt load of 60 per cent or less.