Contents / Operations not regarded as sale of goods for VAT purposes


  • Confiscation of property
  • Inheritance of property
  • Transfer of ownerless and lost objects, ownerless animals or found treasures to third parties in accordance with the Civil Code of the RF
  • Privatisation of residential premises and property of state-owned and municipal unitary enterprises
  • Transfer of residential premises, kindergartens, clubs, health-care institutions and other social amenities to the bodies of state power
  • Transfer of fixed assets to the bodies of state power or budgetary organisations
  • Work performed (service rendered) by state or municipal bodies in pursuance of obligations set by the legislation

Revenues not included into the tax base:

  • Refundable and non-refundable funds received from the state and municipal budgets
  • Funds received from charitable organisations

VAT exempt goods (works, services):

  • Transfer of participatory shares in limited liability companies
  • Insurance
  • Some R&D operations
  • Sales of companies employed disabled (within some limits)
  • Gratuitous aid
  • Some other goods (works, services)

In particular, contributions to statutory capital of business entities, unit investment funds, contributions under contract of general partnership (joint activity contract)

Transfer of property to a company's participant
Transfer of property of a business entity to its participant (the participant's successor(s) or heir(s)) within the limits of the initial contribution:
  • upon the participant's withdrawal
  • upon the liquidation of the business entity
Transfer of property under joint activity contract
Transfer of property to a partner of general partnership (under joint activity contract) or to its successor within the limits of the initial contribution:
  • as allocation to a partner its share of property in joint ownership
  • as the partner's portion in case of division of property in joint partnership
Transfer of property to state and municipal bodies
Gratuitous transfer of the following property to state or municipal bodies (or to designated specialised organisations):
  • residential premises, kindergartens, clubs, health-care institutions and other social amenities
  • roads, electric power distribution networks and stations, gas distribution networks, water supply structures and similar facilities
Settlements with shareholders (participants)
  • funds transferred by shareholders (owners) to the legal entity
  • funds transferred from centralised reserves of the joint-stock companies to daughter and dependent companies as secondary distribution of profit
  • funds transferred from net profit of daughter and dependent companies to centralised reserves of mother joint-stock company or for centralised management purposes according to approved budget
Medicine, social sphere
Medical goods, including:
  • Medical devices and equipment in the list of the RF Government of staple goods
  • Orthopaedic articles, (raw) materials for production thereof
  • Technical devices, including motor transport, used exclusively for the prevention of disability and rehabilitation of the disabled (according to the established list)
  • Eyeglasses, lenses and eyeglass frames (except for sun glasses)

Organisations and individual entrepreneurs acting as middlemen in distribution of the goods listed below are also entitled for VAT exemption

Health care services rendered by medical organisations and (or) medical institutions including services of private practitioners; except for all cosmetic services, and veterinary and sanitary services other than those financed out of the state budget:
  • Medical services rendered in accordance with compulsory medical insurance
  • Medical care provided for pregnant women, babies, the disabled and addicts
  • Diagnostics, disease prevention and medical treatment services on the Government list
  • Medical nursing, medical emergency services, services of blood donor centres rendered under contracts with medical institutions and hospitals
  • Post-mortem examination services
  • Prosthetic and orthopaedic services
  • Producing pharmaceuticals in drugstores, repair and manufacturing of eyeglasses (except for sun glasses), repair of hearing-aid and orthopaedic articles
Services in the field of education recognised as non-entrepreneurial activity (provided the taxpayer has an appropriate license)