Tax Residency and Income: how it works in Germany — first-hand

From the German perspective, if the 'center of vital interests' remains in Germany, issues might be avoided. However, this arrangement can lead to significant tax residency complications in Russia, potentially resulting in loss of Russian tax residency benefits. Transferring salary from a German bank account to Russia can also be challenging. This setup is particularly complex for Russian citizens and may lead to legal and financial repercussions in both countries, especially concerning taxation and social security contributions.

Any income generated from Russian self-employment (e.g., rental income managed via self-employment status) must be declared in the German tax declaration. Based on user experience, this typically does not lead to complications or further inquiries from German tax authorities.

An individual becomes a tax resident of Germany upon employment and tax ID registration. If an individual spends less than 183 days in Russia within a calendar year, they lose their tax residency status in Russia. These statuses are not simultaneous for the entire year but are calculated based on the duration of stay in each jurisdiction.

Non-residents (those spending >183 days outside Russia in a calendar year) are exempt. However, the Federal Tax Service (FNS) may still request proof of non-residency status. Always keep proof of stay abroad (passport stamps, residence permits) ready to avoid administrative penalties.