On taxes and other obligatory payments to the budget (Tax Code)

Article 281. Features of tax accounting in case of execution by delivering an underlying asset

1. If a derivative financial instrument is used for the acquisition or sale of an underlying asset, the expenses payable (incurred) and payments (to be) received as a result of the acquisition or sale of the underlying asset are not attributed to expenses for and proceeds from derivative financial instruments.

2. Proceeds from and expenses for transactions specified in paragraph 1 of this article shall be accounted for tax purposes in accordance with the provisions of this Code established for the underlying asset.
Clause 6. Long-term contracts
Article 282. General provisions

1. A long-term contract is a contract (agreement) for production, installation, construction, which is not performed within the taxable period in which the production, installation, construction under the contract began.

2. Tax accounting for each long-term contract is maintained separately.

3. Income under a long-term contract is determined using either the actual method or completion method, at the choice of a taxpayer, separately for each long-term contract.

A method chosen for income determination is indicated in a tax register, intended for reflecting methods applied to each long-term contract, and may not be changed during the period of validity of the long-term contract.

Without such a tax register or information in it on the method chosen, the actual method is recognized as the chosen one.

4. The amount of expenses incurred for a taxable period under a long-term contract shall be allocated to deductibles in accordance with paragraphs 2, 3 and 4 of this Section.
Article 283. The order for determining income under a long-term contract using the actual method

1. According to the actual method, income received under a long-term contract for a reporting taxable period is recognized as income (to be) received for the reporting taxable period, but not less than the amount of expenses incurred for such a period under the long-term contract.

2. If, during the period of validity of a long-term contract, income under such a contract, determined in accordance with paragraph 1 of this article, exceeds the total amount of income under the long-term contract, determined for the entire period of its validity, the income under this long-term contract is recognized as:

1) that in the amount of positive difference between the total amount of income under the long-term contract, determined for the entire period of its validity, and the amount of income under such a contract included in total annual income in previous taxable periods of the validity of the long-term contract - in the taxable period in which the excess occurred;

2) equal to zero - in subsequent taxable periods of the validity of the long-term contract.
Article 284. The order for determining income under a long-term contract using the completion method

1. When applying the completion method, for tax purposes, income under a long-term contract for a reporting taxable period is determined as follows:

the product of the total amount of income under a long-term contract to be received under this contract for the entire period of its validity and the portion of performance of such a contract for current taxable period

minus

income under such a long-term contract for tax purposes for previous taxable periods.

2. Unless otherwise established by this article, the portion of performance of a long-term contract is calculated using the following formula:

A/( A+B), where:

A - expenses under a long-term contract allocated to deductibles in accordance with this Code for previous and reporting taxable periods;

B - expenses under a long-term contract to be incurred in accordance with design estimates in subsequent taxable periods for the completion of works under the long-term contract that shall be allocated to deductibles in subsequent taxable periods of the validity of the long-term contract.

3. In the taxable period in which a long-term contract expires, the portion of performance of such a long-term contract is equal to one.
Article 285. Features of determining the amount of total annual income and deductions for corporate income tax purposes in the transfer of hydrocarbons in case of fulfillment of a tax obligation in kind

If a subsoil user fulfills a tax obligation to pay taxes in kind, as of the date of transfer of minerals to a recipient on behalf of the state:

1) the amount of the fulfilled tax obligation to pay taxes that was executed in kind is to be included in total annual income;

2) the production cost of minerals transferred to pay taxes in kind is allocated to deductibles;

3) the amount of the fulfilled tax obligation to pay taxes in kind is allocated to deductibles in the manner specified in Article 263 of this Code.
Clause 7. Adjustment of income and deductions