In simple terms
VAT (НДС, NDS) is value added tax. It is «hidden» in the price of almost everything you buy: food, electronics, services. The buyer pays it as part of the price, and the seller transfers it to the budget.
The name explains the idea: each participant in the chain — manufacturer, wholesaler, shop — pays tax only on the amount that they «added» to the price. To do this, the VAT that was already paid to suppliers is subtracted from the VAT on sales.
Rates in 2026
| Rate | What it applies to |
|---|---|
| 22% | basic rate, for most goods and services (from 1 January 2026, previously 20%) |
| 10% | many foods, children's goods, books, medicines and medical devices |
| 5% and 7% | optional for companies and sole traders (IP) on the simplified tax system (USN), with no right to deduct VAT |
| 0% | exports and a number of other transactions |
Companies and sole traders (IP) on USN do not pay VAT while their income for the year is not more than 20 million ₽ (the threshold for 2026). Self-employed people do not pay VAT.
How to calculate it
VAT added on top = amount without VAT × 22%
VAT inside a total = amount with VAT × 22 / 122
For a rate of 10% the formula is the same, only 10 / 110. You can quickly calculate in both directions, and get the amount in words for documents, in the VAT calculator.
Calculate it yourself
Change the numbers and the step-by-step calculation updates instantly. Russian rules for 2026.
Example with numbers
A shop bought a table from a supplier for 61,000 ₽ including VAT. The VAT in this amount: 61,000 × 22 / 122 = 11,000 ₽, and the price without tax is 50,000 ₽.
The shop sells the table for 100,000 ₽ without VAT. VAT on top: 100,000 × 22% = 22,000 ₽, and the buyer pays 122,000 ₽.
The shop will transfer to the budget not 22,000 ₽ but the difference: 22,000 − 11,000 = 11,000 ₽. That is the tax on the «added» value: the shop added 50,000 ₽, and 50,000 × 22% = 11,000 ₽.
If the shop worked on USN with a VAT rate of 5%, it would pay 100,000 × 5% = 5,000 ₽, but it could not deduct the «input» 11,000 ₽.
Common mistakes
- Extracting VAT by multiplying by 22%. From 122,000 ₽ this gives 26,840 ₽ instead of the correct 22,000 ₽ — you need to multiply by 22 / 122.
- Forgetting about the new rate: for goods and services shipped from 1 January 2026, 22% applies, even if the contract was signed earlier.
- Writing «including VAT» on an invoice for payment if the seller is on USN without VAT. In that case you write «Without VAT» («Без НДС»).
- Confusing VAT with NDFL (personal income tax): NDFL is paid on people's income, and VAT on sales.
In Russia, Kazakhstan and Belarus
Russia
The rules are in Chapter 21 of the Tax Code. Rates: 22%, 10%, 0% (exports). Companies and sole traders (IP) on the simplified tax system (USN) with income above 20 million ₽ a year pay VAT — at reduced rates of 5% or 7% without deductions, or at the general rates.
Kazakhstan
In Kazakhstan, from 2026 the basic VAT rate is 16%, with a reduced rate for medicines and medical services. You must register for VAT when turnover exceeds 10,000 MRP a year.
Belarus
In Belarus the basic VAT rate is 20%, and 10% for certain foods and children's goods.
Sources: Tax Code of the Russian Federation, Part Two («Налоговый кодекс РФ»), ConsultantPlus, Federal Tax Service of Russia («ФНС России»)