Media & Resources
Personal Income Tax (PIT) on compensation payments after divorce
DATE: September 13, 2024 | AUTHOR: AT
Situation: Upon a divorce one of the ex-spouses received more than half of the assets gained during the marriage. To compensate the unequal distribution of the assets gained during the marriage the ex-spouses agreed that the one who received more than half of the assets would pay a compensation to the other ex-spouse. The Russian Ministry of Finance clarified that such compensatory payments are not subject to PIT – as quoted below:
“When former spouses enter into an agreement regarding the division of property that was in their joint ownership, they do not generate income subject to PIT”.
Letter of the Ministry of Finance of Russia dated July 16, 2024, No. 03-04-05/66321
