Russia’s geographical location contributed to the country’s vast riches and high economic standing. They are a leading producer of oil and natural gas, owning about 27.5% of the world's natural resources. They are the 5th largest economy in Europe and the 11th largest globally. The country’s citizens are some of the most successful in the world due to their economic stability and well-developed education system.

Major Economic Hubs:

Moscow, St. Petersburg And Yekaterinburg

Skills in Demand:

Risk Managers, Computer Programmers/I.T. Staff, Medical And Pharmaceutical

Resident Tax Information

The Russian government taxes its citizens on their worldwide income. Non-residents and temporary residents are taxed only in the country where they live or work, making it possible for them to reside anywhere without paying higher rates than locals do.

In Russia, the tax rate for individuals is 13% on their annual income up to a maximum of RUB 5 million (about USD 100K) and 15%. If you have more than that each year then it's taxed at 35%. There are also some benefits which get taxed flat - these include prizes or interests from bank deposits as well as insurance plans.

Non-resident individuals in Russia are taxed at 30% on Russian-source income. Dividend income is taxed at 15%.

Additionally, non-resident individuals with an income from professional activities are taxed at 13%.

Material benefits, benefits-in-kind, or monetary benefits are taxable in Russia.

Social Security

The Russian Social security covers the following benefits for its employees —

• Medical insurance fund

• Pension fund

• Social insurance fund

• Accident insurance

The employers of Russia make contributions to the social security fund solely on their own.The contributions made by the employers include —

Statutory Benefits

Employers must provide certain mandatory benefits if they reside in Russia. The statutory benefits as laid out by the labor laws include —

• Paid days off

• Health insurance

• Accident insurance

• Pension insurance

Paid days off

Russia has many different labor laws that determine what kind of leaves an employee is entitled to. All mandatory ones, as laid out by these regulations are included in this list - they're outlined thoroughly earlier on.The paid days in Russia that employers must provide their employees include —

1. Annual leaves
2. Parental leaves
3. Military leaves
4. Public holidays
5. Sick leaves
6. Study leaves
7. Maternity leaves, paternity leaves
8. Bereavement leaves
   

Additional days such as weekends are also provided to employees working in Russia.

Health insurance

Compulsory Health Insurance (CHI) covers all Russian citizens and is financed by social taxes.

Accident insurance

Accidents at work can be costly for employers, so they're covered by accident insurance. The employee's contribution is also necessary to ensure that you have enough funds if anything happens on the job.

Pension insurance

Employer’s contribution towards the state pension fund finances the pensions for the retired population of Russia.

Fringe Benefits

Employers commonly offer fringe benefits in addition to the general compensation package and statutory benefits. Commonly provided fringe benefits in Russia include —

• Housing
• Meal vouchers
• Educational support
• Company assets such as laptops, mobile phones, etc.
• Company vehicles
• Business travel  expenses

Exempt Benefits

There are a few exempt benefits in Russia

• Business travel expenses that are documented

• Social security benefits and contributions

• Gifts and cash prized provided that are lesser than RUB 4,000

Long-term Incentives

Long-term incentives are a great way for employers to retain their best employees. These types of rewards provide people with more opportunities and less likely will want or need another job after receiving it, which means that company can save money by not having them work elsewhere.Commonly provided long-term incentives include —

• Voluntary life, medical, and accident insurance

• Voluntary pension plans

• Employee stock option plans

The company should provide stock options to employees who are in key positions, helping it grow and develop.

Termination Process

An employment contract can only be terminated in accordance with a strict list of general reasons, including:

• Mutual agreement
• On the employee's/employer's initiative
• Expiry of the contract
• Other specific grounds

Employment can only be terminated on the employer's initiative for specific reasons, including:

• The employer's liquidation
• Redundancy
• Numerous failures by the employee to fulfill official duties without good reason provided a reprimand has been issued
• Gross misconduct
• Unauthorized disclosure of confidential information
• Other rarely used grounds

In general, under the current legislation, dismissal is not feasible without prior notice being served on the employee.

Notice Period

The Notice Period for probationary employees is up to 14 days while regular employees have up to 4 weeks.

Severance Pay

The severance payment rate depends on the reasons for the termination. Below are the regulations surrounding it:

Company liquidation

• 1 month's salary plus the average monthly salary during the period they are looking for a new job (but for no longer than two months from the date of termination).

Failure to conform to the standards of the job due to health- military service or any alternative civilian service in place of military service.

• 2 weeks’s average earning

Reinstatement at work of the employee that previously held the employee's position.

• 2 weeks’s average earning

The employee's refusal to relocate when the employer moves to another locality.

• 2 weeks’s average earning