Payroll and HR administration in Russia

What Payroll & HR covers

Russian payroll is not complicated, but it is specific: twice-monthly payment cycles, a 30% employer burden, and penalties that start the day a payment is late. We run the monthly cycle, handle NDFL and contributions, keep the HQS regime working in your favour, and report it back to head office in a form they can read.

The salary you offer is not what you pay, and it is not what your employee receives. For every ₽100,000 of gross salary, the company's cost is roughly ₽130,000 — the salary plus around 30% in employer social contributions — and the employee takes home about ₽87,000 after personal income tax. Three different numbers for one salary, and head offices routinely budget against the wrong one. Russian payroll is not complicated. It is specific, and the specifics are where it goes wrong.

Employer social contributions run at roughly 30% of gross salary, paid to the Social Fund of Russia — the SFR, formed in 2023 by merging the Pension Fund and the Social Insurance Fund. This is the employer's cost on top of salary, not a deduction from it. Personal income tax is separate: 13% for residents, 15% above an annual threshold and up to 22% under the progressive scale, withheld from the employee's pay.

Highly Qualified Specialists — ВКС — are exempt from Russian social contributions entirely, and pay 13% NDFL from their first day regardless of residency. That combination removes roughly 30% from the cost of employing a foreign specialist and eliminates the 30% non-resident tax rate at the same time. It is the most tax-efficient way to employ foreign nationals in Russia, and it is not obscure — it is simply a regime that has to be applied for, maintained and evidenced.

The condition is a minimum salary of ₽750,000 per quarter, moving to ₽717,000 per month from 1 March 2027. If your specialist's salary sits near it, the change is worth modelling now rather than discovering at a renewal. Payroll, immigration and tax have to be run as one conversation here — we do, because the answer depends on all three.

Russian labour law requires salary to be paid at least twice a month, with no more than 15 calendar days between payments. A foreign company that runs its global payroll monthly is non-compliant from its first payroll run, and usually does not know it. Since 2023 the mid-month advance must be calculated on salary actually earned for the period worked — a fixed percentage of monthly pay, which was the old habit, no longer satisfies the rule.

This is where Russian payroll stops being an administrative matter. Under a 2024 Constitutional Court ruling, an employer owes interest at 1/300 of the CBR key rate per day on any accrued but unpaid salary, vacation pay or termination payment — including where the delay results from a court dispute the employer expected to win. Fines for a first offence reach ₽10 million; repeat violations run to ₽60 million.

There is no version of Russian payroll where a delay is manageable and gets tidied up later. That is worth knowing before you decide who runs it.

An EOR legally employs people on your behalf, so you can hire in Russia without an entity. It genuinely fits a few situations: testing the market with one or two hires, a six-to-twelve-month project, a single remote Russian employee, or a bridge while your LLC is being registered. It does not fit larger teams or long-term operations — the per-employee fee compounds, you have less control over the employment relationship, and some employees dislike being formally employed by a company they do not work for.

The practical point most pages will not tell you: the global EOR platforms — Deel, Remote, Rippling and the rest — generally do not service Russia, for sanctions-compliance reasons. Russian-market providers exist. If your plan begins with a global platform, check its Russia coverage explicitly before building a timeline on it.

Russian payroll reporting is built for Russian authorities, and it is not readable by a foreign finance team. We run the cycle in Russian for the FTS and the SFR, and report it back in English: cost per employee, the employer burden separated from net pay, headcount movements and the accruals your group needs for consolidation. Where we also run the accounting, the payroll figures are already reconciled into the books rather than handed across a gap between two providers — which is where a good share of the reconciliation problems we inherit were created.

We take payroll as one function rather than a set of filings: monthly calculation, payslips, NDFL, contributions, SFR reporting, employment documentation, the HQS regime where it applies, and terminations when they come. If you are moving from another provider, we reconcile the position before we take it over, so you are not inheriting someone else's arithmetic without knowing it. Our advisers trained at the Big Four and work in English, Russian, Chinese and Turkish.

What we handle

What’s included

When clients come to us

European engineering group, 40 staff — payroll inherited mid-cycle

The group had run Russian payroll from head office on a monthly cycle for two years, in good faith, and was non-compliant from the first run. Nobody had told them about the twice-a-month rule; their previous provider had processed what they were sent. We reconciled the position, quantified the accrued interest exposure, moved them onto a compliant cycle without a gap in payments, and applied the HQS regime to four foreign specialists who had been on standard terms throughout. The contribution saving on those four alone covered our first year.

How the work runs

In-house, EOR, or outsourced payroll

Tools for this service

Paying people in Russia from abroad

Since 2025 a foreign company can become an NDFL tax agent without any Russian presence — if the work runs through Russian systems. Different rules, different registration.

Questions about Payroll & HR